Below-market rate homes

[sdstargirl]

Hello everyone, this is my first time posting at Piggington and I hope this question hasn’t been asked. I don’t think it has, but if it has, my apology.

I would like to know if there are any advantages in purchasing the restricted affordable housing offered by the San Diego Housing Commission to help buyers purchases below-market rate homes?

At the housing commission website, there is a list of all the affordable housing available in San Diego. Some of the properties are in great areas — Carmel Valley (well, maybe just one)– and if I did my math correctly it is actually cheaper to buy than to rent, assuming if I get selected. If I purchased this type of property, I would actually save more money and get the extra benefits from being a homeowner. The downside is that I won’t get any equity because the city requires these homes to remain affordable, so when I sale the house, I have to sale it at an affordable price determined by the city which most likely means no to very minimal profit. But I am renting right now, and I am not getting any tax benefits from it, so what’s the difference?

Any advices, thoughts or opinions are greatly appreciated.

Thanks!

[NotCranky]

I have seen much better programs. Specifically silent seconds,where no payment is due on the second and it expires after a set number of years. Haven’t looked into it lately. You could google that for San Diego if you haven’t already.
In any case my advice is to wait and see what happens. You might to be able to put yourself in a much better ownerships and equity position if you wait,with or without financial assistance.

[NotCranky]

I have seen much better programs. Specifically silent seconds,where no payment is due on the second and it expires after a set number of years. Haven’t looked into it lately. You could google that for San Diego if you haven’t already.
In any case my advice is to wait and see what happens. You might to be able to put yourself in a much better ownerships and equity position if you wait,with or without financial assistance.

[NotCranky]

I have seen much better programs. Specifically silent seconds,where no payment is due on the second and it expires after a set number of years. Haven’t looked into it lately. You could google that for San Diego if you haven’t already.
In any case my advice is to wait and see what happens. You might to be able to put yourself in a much better ownerships and equity position if you wait,with or without financial assistance.

[Bugs]

Apart from the stability factor, one of the primary reasons to buy rather than to rent is to stabilize your housing costs. Assuming you don’t refinance, your mortgage payment stays the same no matter what the market rents are.

There are some people who think that rents are as subject to decline as sale prices during economic downturns, but so far that hasn’t ever happened yet in SD County to any significant degree. That could change, but if that happened it would be the first time.

The one thing about buying an affordable housing unit is that you’re not looking at as large a profit opportunity as you would be looking at if the property had no such restrictions. If you think your income is going to increase a lot over the next 10 years you may be considering this home to be the first of 2 or 3 homes, in which case you might be better off timing the market to buy low so as to be able to sell high later on.

On the other hand if you think your income is going to be relatively stable and you aren’t planning to move up this becomes a long term decision that relates to your quality of life, control of housing expenses and such rather than profit opportunity.

Personally, I think if you stick around for a few years you’ll be able to buy a similar unit without the affordable housing restrictions for less than these units are now selling. But nobody knows the future and you will have to come to your own opinions at some point.

[Bugs]

Apart from the stability factor, one of the primary reasons to buy rather than to rent is to stabilize your housing costs. Assuming you don’t refinance, your mortgage payment stays the same no matter what the market rents are.

There are some people who think that rents are as subject to decline as sale prices during economic downturns, but so far that hasn’t ever happened yet in SD County to any significant degree. That could change, but if that happened it would be the first time.

The one thing about buying an affordable housing unit is that you’re not looking at as large a profit opportunity as you would be looking at if the property had no such restrictions. If you think your income is going to increase a lot over the next 10 years you may be considering this home to be the first of 2 or 3 homes, in which case you might be better off timing the market to buy low so as to be able to sell high later on.

On the other hand if you think your income is going to be relatively stable and you aren’t planning to move up this becomes a long term decision that relates to your quality of life, control of housing expenses and such rather than profit opportunity.

Personally, I think if you stick around for a few years you’ll be able to buy a similar unit without the affordable housing restrictions for less than these units are now selling. But nobody knows the future and you will have to come to your own opinions at some point.

[Bugs]

Apart from the stability factor, one of the primary reasons to buy rather than to rent is to stabilize your housing costs. Assuming you don’t refinance, your mortgage payment stays the same no matter what the market rents are.

There are some people who think that rents are as subject to decline as sale prices during economic downturns, but so far that hasn’t ever happened yet in SD County to any significant degree. That could change, but if that happened it would be the first time.

The one thing about buying an affordable housing unit is that you’re not looking at as large a profit opportunity as you would be looking at if the property had no such restrictions. If you think your income is going to increase a lot over the next 10 years you may be considering this home to be the first of 2 or 3 homes, in which case you might be better off timing the market to buy low so as to be able to sell high later on.

On the other hand if you think your income is going to be relatively stable and you aren’t planning to move up this becomes a long term decision that relates to your quality of life, control of housing expenses and such rather than profit opportunity.

Personally, I think if you stick around for a few years you’ll be able to buy a similar unit without the affordable housing restrictions for less than these units are now selling. But nobody knows the future and you will have to come to your own opinions at some point.

[Author]

Posts