anyone even slightley bullish about RE market?

[sdduuuude]

TG. Your rent/buy decision point is important, but the assumption of stable rents may be deteriorating.

http://www.latimes.com/business/la-fi-rent8-2009jan08,0,5261091.story

I’m starting to think people will be more scared later than they are now, maybe even in Temecula.

Could take many months for Return of the Pain Train , but if rents slip, there goes the neighborhood.

[carlsbadworker]

I think rent has very direct correlation with income. So with unemployment rate rising, the rent will surely drop. However, unless you are predicting 20%+ unemployment rate, there is not much rooms for rents to drop especially in low-price area. Also I always ignore the current house rent price but prefer to use 3-bedrooms apartment rental price. I have never seen apartment rental goes down by much although they sometimes offer promotions to effectively lower their rents. But that’s all temporary, and if you expect to live in the house yourself, you should be able to ride it out.

So I agree with ANN above, although I would change his formula a little bit. I think it is prefect safe to buy if PITI < 3-bedroom-rents for self use. But for investment, I think I would like to see mortgage < 50%* rents (assume 20% down), we are not there yet. That's my floor of real estate market price in doomsday scenario (i.e. another 25-30% drop in town like Temecula). If I still have job at that time, I would happily pick up an investment property at that time. If I don't have a job at that time, I would have wished that I had bought now when I still have verifiable W2 income to get the best mortgage rate. I will just use my remaining cash to ride out the down turn instead of being able to have a rental property to my name. The economy will recover one day or another. I believe at least we agree on that, right?

[carlsbadworker]

I think rent has very direct correlation with income. So with unemployment rate rising, the rent will surely drop. However, unless you are predicting 20%+ unemployment rate, there is not much rooms for rents to drop especially in low-price area. Also I always ignore the current house rent price but prefer to use 3-bedrooms apartment rental price. I have never seen apartment rental goes down by much although they sometimes offer promotions to effectively lower their rents. But that’s all temporary, and if you expect to live in the house yourself, you should be able to ride it out.

So I agree with ANN above, although I would change his formula a little bit. I think it is prefect safe to buy if PITI < 3-bedroom-rents for self use. But for investment, I think I would like to see mortgage < 50%* rents (assume 20% down), we are not there yet. That's my floor of real estate market price in doomsday scenario (i.e. another 25-30% drop in town like Temecula). If I still have job at that time, I would happily pick up an investment property at that time. If I don't have a job at that time, I would have wished that I had bought now when I still have verifiable W2 income to get the best mortgage rate. I will just use my remaining cash to ride out the down turn instead of being able to have a rental property to my name. The economy will recover one day or another. I believe at least we agree on that, right?

[carlsbadworker]

I think rent has very direct correlation with income. So with unemployment rate rising, the rent will surely drop. However, unless you are predicting 20%+ unemployment rate, there is not much rooms for rents to drop especially in low-price area. Also I always ignore the current house rent price but prefer to use 3-bedrooms apartment rental price. I have never seen apartment rental goes down by much although they sometimes offer promotions to effectively lower their rents. But that’s all temporary, and if you expect to live in the house yourself, you should be able to ride it out.

So I agree with ANN above, although I would change his formula a little bit. I think it is prefect safe to buy if PITI < 3-bedroom-rents for self use. But for investment, I think I would like to see mortgage < 50%* rents (assume 20% down), we are not there yet. That's my floor of real estate market price in doomsday scenario (i.e. another 25-30% drop in town like Temecula). If I still have job at that time, I would happily pick up an investment property at that time. If I don't have a job at that time, I would have wished that I had bought now when I still have verifiable W2 income to get the best mortgage rate. I will just use my remaining cash to ride out the down turn instead of being able to have a rental property to my name. The economy will recover one day or another. I believe at least we agree on that, right?

[carlsbadworker]

I think rent has very direct correlation with income. So with unemployment rate rising, the rent will surely drop. However, unless you are predicting 20%+ unemployment rate, there is not much rooms for rents to drop especially in low-price area. Also I always ignore the current house rent price but prefer to use 3-bedrooms apartment rental price. I have never seen apartment rental goes down by much although they sometimes offer promotions to effectively lower their rents. But that’s all temporary, and if you expect to live in the house yourself, you should be able to ride it out.

So I agree with ANN above, although I would change his formula a little bit. I think it is prefect safe to buy if PITI < 3-bedroom-rents for self use. But for investment, I think I would like to see mortgage < 50%* rents (assume 20% down), we are not there yet. That's my floor of real estate market price in doomsday scenario (i.e. another 25-30% drop in town like Temecula). If I still have job at that time, I would happily pick up an investment property at that time. If I don't have a job at that time, I would have wished that I had bought now when I still have verifiable W2 income to get the best mortgage rate. I will just use my remaining cash to ride out the down turn instead of being able to have a rental property to my name. The economy will recover one day or another. I believe at least we agree on that, right?

[carlsbadworker]

I think rent has very direct correlation with income. So with unemployment rate rising, the rent will surely drop. However, unless you are predicting 20%+ unemployment rate, there is not much rooms for rents to drop especially in low-price area. Also I always ignore the current house rent price but prefer to use 3-bedrooms apartment rental price. I have never seen apartment rental goes down by much although they sometimes offer promotions to effectively lower their rents. But that’s all temporary, and if you expect to live in the house yourself, you should be able to ride it out.

So I agree with ANN above, although I would change his formula a little bit. I think it is prefect safe to buy if PITI < 3-bedroom-rents for self use. But for investment, I think I would like to see mortgage < 50%* rents (assume 20% down), we are not there yet. That's my floor of real estate market price in doomsday scenario (i.e. another 25-30% drop in town like Temecula). If I still have job at that time, I would happily pick up an investment property at that time. If I don't have a job at that time, I would have wished that I had bought now when I still have verifiable W2 income to get the best mortgage rate. I will just use my remaining cash to ride out the down turn instead of being able to have a rental property to my name. The economy will recover one day or another. I believe at least we agree on that, right?

[an]

carlsbadworker, the only problem with 3-bedrooms apartment is that they’re very rare. As a personal use, I think compare to rent of similar house is better, since you have to live somewhere and you have to compare apple to apple in regards to the place you’ll be living in.

San Diego, I think, is a long way from <50%*rent, if it ever get there. However, places like Fresno is already there.

[an]

carlsbadworker, the only problem with 3-bedrooms apartment is that they’re very rare. As a personal use, I think compare to rent of similar house is better, since you have to live somewhere and you have to compare apple to apple in regards to the place you’ll be living in.

San Diego, I think, is a long way from <50%*rent, if it ever get there. However, places like Fresno is already there.

[an]

carlsbadworker, the only problem with 3-bedrooms apartment is that they’re very rare. As a personal use, I think compare to rent of similar house is better, since you have to live somewhere and you have to compare apple to apple in regards to the place you’ll be living in.

San Diego, I think, is a long way from <50%*rent, if it ever get there. However, places like Fresno is already there.

[an]

carlsbadworker, the only problem with 3-bedrooms apartment is that they’re very rare. As a personal use, I think compare to rent of similar house is better, since you have to live somewhere and you have to compare apple to apple in regards to the place you’ll be living in.

San Diego, I think, is a long way from <50%*rent, if it ever get there. However, places like Fresno is already there.

[an]

carlsbadworker, the only problem with 3-bedrooms apartment is that they’re very rare. As a personal use, I think compare to rent of similar house is better, since you have to live somewhere and you have to compare apple to apple in regards to the place you’ll be living in.

San Diego, I think, is a long way from <50%*rent, if it ever get there. However, places like Fresno is already there.

[sdduuuude]

[quote=carlsbadworker]The economy will recover one day or another. I believe at least we agree on that, right?
[/quote]

One day, I guess.

What is it about “Japan had 0% rates and still lost a decade” that people don’t understand ?

[sdduuuude]

[quote=carlsbadworker]The economy will recover one day or another. I believe at least we agree on that, right?
[/quote]

One day, I guess.

What is it about “Japan had 0% rates and still lost a decade” that people don’t understand ?

[sdduuuude]

[quote=carlsbadworker]The economy will recover one day or another. I believe at least we agree on that, right?
[/quote]

One day, I guess.

What is it about “Japan had 0% rates and still lost a decade” that people don’t understand ?

[sdduuuude]

[quote=carlsbadworker]The economy will recover one day or another. I believe at least we agree on that, right?
[/quote]

One day, I guess.

What is it about “Japan had 0% rates and still lost a decade” that people don’t understand ?

[Author]

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