housing a sucker’s bet now?

[scaredyclassic]

I am now officially looking to buy a house. i went inside one with my spouse and kids and we actually looked at it as if we might buy it. Very first one inside (we’ve driven around, sure, but never actually went inside…). So, I can see where all this housing fever comes from. It was kind of thrilling to go inside. i was moved to put an offer on it. I said to my wife, hey, let’s buy this! This is great! I was actually serious, I was ready to buy it. She said it was ugly. Now a few days have gone by, and I’m thinking, what am I, nuts? I’m a contrarian generally. When everyone thinks one thing, i like to try to think the other way. It seems generally accepted that housing is going down for sure no ifs ands or buts, the next year plus. I’d like to be contrarian about it. but I cannot. it is going down. Who knows how far. I still like that house and am willing to buy it, on the one hand, but cannot help thinking that only a sucker would buy a house right now. In fact, i feel like it’s almost as much a sucker’s bet as it was 3 years ago. My grandfather bought a house in NYC after the stock market crash for 20 cents on the dollar off the peak. Thats what they were going for. I think 20-30 cents on the dollar off peak prices is what i should be paying, simply based on this anecdote and my own sense of impending doom. am I wrong. is there any way in heck this could be the bottom?

[temeculaguy]

scardey, you need to evaluate fundamentals, not stories of 1920 or 2006. Just figure out what you pay in rent, what it would cost you to buy and compare the difference after taxes. When they are almost a tie, you buy and you trade off the maintenance for the rent control. Primary houses are not an investment, look at it as a shelter that you must pay for one way or another.

I put in a bid recently and will find out probably by the close of business tomorrow if I am in escrow. My scenario is a little different because i am renting something smaller than I want because the lease terms were beneficial but I just ran the numbers to compare. Here they are

1600 sq ft rental 1500/mo 3/2/ 2 car
the purchase offer I made is 3000 sq ft 5/4/3 car 1600 mo P%I to buy if I put nothing down (i will put money down but that money costs me profit/interest elsewhere so I use 0 down to do the math). It may be as high as 1750, interest rates have been all over the map day to day.

There will be taxes, insurance, hoa and other costs but they are equal to the tax deduction so I compare the pure 0 down principal and interest using 30 fixed and make my comparison. It isn’t exactly a wash, i’m paying $100 to $200 more to buy but it is much larger place and rent would have been 2k+ for that one had I chose to rent a larger place. I could buy my exact rental for $1100 P&I. In both cases, it’s cheaper to buy than to rent. You need to run your numbers, that is what is relevent, not historical or other parts of the country, none of that matter, just your numbers matter.

Run your own numbers using this formula or post your rent and your purchse price and I’ll tell you if it makes sense, please note if your rental and your purchse are not comparable because that matters. Stop thinking of houses as an investment, purchasing merely locks your rent, nothing more. If you want to invest in r/e, then you buy rental property.

[temeculaguy]

scardey, you need to evaluate fundamentals, not stories of 1920 or 2006. Just figure out what you pay in rent, what it would cost you to buy and compare the difference after taxes. When they are almost a tie, you buy and you trade off the maintenance for the rent control. Primary houses are not an investment, look at it as a shelter that you must pay for one way or another.

I put in a bid recently and will find out probably by the close of business tomorrow if I am in escrow. My scenario is a little different because i am renting something smaller than I want because the lease terms were beneficial but I just ran the numbers to compare. Here they are

1600 sq ft rental 1500/mo 3/2/ 2 car
the purchase offer I made is 3000 sq ft 5/4/3 car 1600 mo P%I to buy if I put nothing down (i will put money down but that money costs me profit/interest elsewhere so I use 0 down to do the math). It may be as high as 1750, interest rates have been all over the map day to day.

There will be taxes, insurance, hoa and other costs but they are equal to the tax deduction so I compare the pure 0 down principal and interest using 30 fixed and make my comparison. It isn’t exactly a wash, i’m paying $100 to $200 more to buy but it is much larger place and rent would have been 2k+ for that one had I chose to rent a larger place. I could buy my exact rental for $1100 P&I. In both cases, it’s cheaper to buy than to rent. You need to run your numbers, that is what is relevent, not historical or other parts of the country, none of that matter, just your numbers matter.

Run your own numbers using this formula or post your rent and your purchse price and I’ll tell you if it makes sense, please note if your rental and your purchse are not comparable because that matters. Stop thinking of houses as an investment, purchasing merely locks your rent, nothing more. If you want to invest in r/e, then you buy rental property.

[temeculaguy]

scardey, you need to evaluate fundamentals, not stories of 1920 or 2006. Just figure out what you pay in rent, what it would cost you to buy and compare the difference after taxes. When they are almost a tie, you buy and you trade off the maintenance for the rent control. Primary houses are not an investment, look at it as a shelter that you must pay for one way or another.

I put in a bid recently and will find out probably by the close of business tomorrow if I am in escrow. My scenario is a little different because i am renting something smaller than I want because the lease terms were beneficial but I just ran the numbers to compare. Here they are

1600 sq ft rental 1500/mo 3/2/ 2 car
the purchase offer I made is 3000 sq ft 5/4/3 car 1600 mo P%I to buy if I put nothing down (i will put money down but that money costs me profit/interest elsewhere so I use 0 down to do the math). It may be as high as 1750, interest rates have been all over the map day to day.

There will be taxes, insurance, hoa and other costs but they are equal to the tax deduction so I compare the pure 0 down principal and interest using 30 fixed and make my comparison. It isn’t exactly a wash, i’m paying $100 to $200 more to buy but it is much larger place and rent would have been 2k+ for that one had I chose to rent a larger place. I could buy my exact rental for $1100 P&I. In both cases, it’s cheaper to buy than to rent. You need to run your numbers, that is what is relevent, not historical or other parts of the country, none of that matter, just your numbers matter.

Run your own numbers using this formula or post your rent and your purchse price and I’ll tell you if it makes sense, please note if your rental and your purchse are not comparable because that matters. Stop thinking of houses as an investment, purchasing merely locks your rent, nothing more. If you want to invest in r/e, then you buy rental property.

[temeculaguy]

scardey, you need to evaluate fundamentals, not stories of 1920 or 2006. Just figure out what you pay in rent, what it would cost you to buy and compare the difference after taxes. When they are almost a tie, you buy and you trade off the maintenance for the rent control. Primary houses are not an investment, look at it as a shelter that you must pay for one way or another.

I put in a bid recently and will find out probably by the close of business tomorrow if I am in escrow. My scenario is a little different because i am renting something smaller than I want because the lease terms were beneficial but I just ran the numbers to compare. Here they are

1600 sq ft rental 1500/mo 3/2/ 2 car
the purchase offer I made is 3000 sq ft 5/4/3 car 1600 mo P%I to buy if I put nothing down (i will put money down but that money costs me profit/interest elsewhere so I use 0 down to do the math). It may be as high as 1750, interest rates have been all over the map day to day.

There will be taxes, insurance, hoa and other costs but they are equal to the tax deduction so I compare the pure 0 down principal and interest using 30 fixed and make my comparison. It isn’t exactly a wash, i’m paying $100 to $200 more to buy but it is much larger place and rent would have been 2k+ for that one had I chose to rent a larger place. I could buy my exact rental for $1100 P&I. In both cases, it’s cheaper to buy than to rent. You need to run your numbers, that is what is relevent, not historical or other parts of the country, none of that matter, just your numbers matter.

Run your own numbers using this formula or post your rent and your purchse price and I’ll tell you if it makes sense, please note if your rental and your purchse are not comparable because that matters. Stop thinking of houses as an investment, purchasing merely locks your rent, nothing more. If you want to invest in r/e, then you buy rental property.

[temeculaguy]

scardey, you need to evaluate fundamentals, not stories of 1920 or 2006. Just figure out what you pay in rent, what it would cost you to buy and compare the difference after taxes. When they are almost a tie, you buy and you trade off the maintenance for the rent control. Primary houses are not an investment, look at it as a shelter that you must pay for one way or another.

I put in a bid recently and will find out probably by the close of business tomorrow if I am in escrow. My scenario is a little different because i am renting something smaller than I want because the lease terms were beneficial but I just ran the numbers to compare. Here they are

1600 sq ft rental 1500/mo 3/2/ 2 car
the purchase offer I made is 3000 sq ft 5/4/3 car 1600 mo P%I to buy if I put nothing down (i will put money down but that money costs me profit/interest elsewhere so I use 0 down to do the math). It may be as high as 1750, interest rates have been all over the map day to day.

There will be taxes, insurance, hoa and other costs but they are equal to the tax deduction so I compare the pure 0 down principal and interest using 30 fixed and make my comparison. It isn’t exactly a wash, i’m paying $100 to $200 more to buy but it is much larger place and rent would have been 2k+ for that one had I chose to rent a larger place. I could buy my exact rental for $1100 P&I. In both cases, it’s cheaper to buy than to rent. You need to run your numbers, that is what is relevent, not historical or other parts of the country, none of that matter, just your numbers matter.

Run your own numbers using this formula or post your rent and your purchse price and I’ll tell you if it makes sense, please note if your rental and your purchse are not comparable because that matters. Stop thinking of houses as an investment, purchasing merely locks your rent, nothing more. If you want to invest in r/e, then you buy rental property.

[socrattt]

I see the logic from both ends here, but the difference is that TG is buying in one of the most depressed home markets in this country, while its neighbor sits positioned to fall at a greater rate in the next year or so, IMHO.

There are very few desirable places in San Diego where you can get a mortgage for $1,700/month with 0 down. That said, I don’t necessarily think that Temecula is a bad place to live. I just don’t think it is very practical to many who work in San Diego.

My recommendation is to rent a home near the beach for the next year or so and enjoy yourself before you decide to pull the trigger. Make sure to lock yourself into a lease so you don’t have these sudden urges to buy a home.

TG, good luck with the purchase. I had a chance to check out the area recently and I was shocked not only at how overbuilt the city is now, but at level of home values.

[socrattt]

I see the logic from both ends here, but the difference is that TG is buying in one of the most depressed home markets in this country, while its neighbor sits positioned to fall at a greater rate in the next year or so, IMHO.

There are very few desirable places in San Diego where you can get a mortgage for $1,700/month with 0 down. That said, I don’t necessarily think that Temecula is a bad place to live. I just don’t think it is very practical to many who work in San Diego.

My recommendation is to rent a home near the beach for the next year or so and enjoy yourself before you decide to pull the trigger. Make sure to lock yourself into a lease so you don’t have these sudden urges to buy a home.

TG, good luck with the purchase. I had a chance to check out the area recently and I was shocked not only at how overbuilt the city is now, but at level of home values.

[socrattt]

I see the logic from both ends here, but the difference is that TG is buying in one of the most depressed home markets in this country, while its neighbor sits positioned to fall at a greater rate in the next year or so, IMHO.

There are very few desirable places in San Diego where you can get a mortgage for $1,700/month with 0 down. That said, I don’t necessarily think that Temecula is a bad place to live. I just don’t think it is very practical to many who work in San Diego.

My recommendation is to rent a home near the beach for the next year or so and enjoy yourself before you decide to pull the trigger. Make sure to lock yourself into a lease so you don’t have these sudden urges to buy a home.

TG, good luck with the purchase. I had a chance to check out the area recently and I was shocked not only at how overbuilt the city is now, but at level of home values.

[socrattt]

I see the logic from both ends here, but the difference is that TG is buying in one of the most depressed home markets in this country, while its neighbor sits positioned to fall at a greater rate in the next year or so, IMHO.

There are very few desirable places in San Diego where you can get a mortgage for $1,700/month with 0 down. That said, I don’t necessarily think that Temecula is a bad place to live. I just don’t think it is very practical to many who work in San Diego.

My recommendation is to rent a home near the beach for the next year or so and enjoy yourself before you decide to pull the trigger. Make sure to lock yourself into a lease so you don’t have these sudden urges to buy a home.

TG, good luck with the purchase. I had a chance to check out the area recently and I was shocked not only at how overbuilt the city is now, but at level of home values.

[socrattt]

I see the logic from both ends here, but the difference is that TG is buying in one of the most depressed home markets in this country, while its neighbor sits positioned to fall at a greater rate in the next year or so, IMHO.

There are very few desirable places in San Diego where you can get a mortgage for $1,700/month with 0 down. That said, I don’t necessarily think that Temecula is a bad place to live. I just don’t think it is very practical to many who work in San Diego.

My recommendation is to rent a home near the beach for the next year or so and enjoy yourself before you decide to pull the trigger. Make sure to lock yourself into a lease so you don’t have these sudden urges to buy a home.

TG, good luck with the purchase. I had a chance to check out the area recently and I was shocked not only at how overbuilt the city is now, but at level of home values.

[urbanrealtor]

While I agree with your basic thesis, the one thing I would add is the investment dimension.

For the people buying for the purpose of renting the property out, the magic number I am seeing is 8% return on their investment annually.

If someone feels that they are getting about 1/12th of their money back each year, that seems to make sense for them.

[urbanrealtor]

While I agree with your basic thesis, the one thing I would add is the investment dimension.

For the people buying for the purpose of renting the property out, the magic number I am seeing is 8% return on their investment annually.

If someone feels that they are getting about 1/12th of their money back each year, that seems to make sense for them.

[urbanrealtor]

While I agree with your basic thesis, the one thing I would add is the investment dimension.

For the people buying for the purpose of renting the property out, the magic number I am seeing is 8% return on their investment annually.

If someone feels that they are getting about 1/12th of their money back each year, that seems to make sense for them.

[urbanrealtor]

While I agree with your basic thesis, the one thing I would add is the investment dimension.

For the people buying for the purpose of renting the property out, the magic number I am seeing is 8% return on their investment annually.

If someone feels that they are getting about 1/12th of their money back each year, that seems to make sense for them.

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