How LOW will it really GO???

[23109VC]

I live in Temecula. I work locally – in Temecula. I rent right now. I sold my last house while things were tanking…made a modest amount of money… had I waited I would have been upside down… so I got out in time and i am now one of those people waiting…watching… and wanting to buy a house..but wantin to do it at the right time.

When I buy…I plan to do “normal” financing….not the toxic stuff that got people into trouble. I could VERY comfortably afford a $350-400k house. If I stretch things, I could afford the $500k house…but it would be tighter. When I first moved here a year ago…the houses I “liked” were $500-600k. Now those same houses are $450-500k.

so it’s tempting to snatch one up and have a nice house. some place to settle in and call home.

BUT..I also find myself thinking..you know… if the houses that were $550k… are now $450k…how long will it be for the houses that WERE $650-750k..come down to $450-550k…??? those houses..up here in Temecula..where prices are an order of magnitude LESS than San Diego. $750k-800 will get you a SWEET house. something that would easily cost you $1.4-1.5 down there in San diego land…

So…the big question is.. how low will it go…especially here in Temecula.

are prices going to fall back down to where they were in the late 90s? I’m no expert..but I just don’t see it happening.

When the last real estate drops happened int he late 80s… how big of a drop did it go? 50%? 25%?

the house that I “love” right now..that is listing for $550k… how low will it “go” if I wait another year?

FYI..i stopped in an open house up here and the realtor flat out told me if i could afford to wait..to NOT buy. he said wait at least a year. he predicted another 10% in drops. I was kind of suprised..i had expected him to give me the usual “buy now” BS…but he said to wait. an honest realtor??? say it isn’t so?? 😉 j/k to the honest realtors on this board.. 🙂

[SD Realtor]

I would echo what has been said by many on this board, that outlying areas like Temecula and Riverside County will suffer more depreciation then comparable regions closer to San Diego. If you can continue to wait then I would advise you to do so as well.

SD Realtor

[waiting hawk]

I followed South Riverside county a great deal (5-7 hours each day all least year). It will be at 2002 prices but every downturn in history has over shot so who knows. I have made it a point to buy when it makes sence (in Temecula). 250k for 2,000 sqft house on a 10,000+ lot or I will never buy. Looking at the tons of foreclosures already out, I will hit that mark and send low bids to banks by the end of this year.

PS.. I stated on my website back in July that a small 3 bedroom house will be listed at 299k by the end of 2006. Nov. 28th one listed. I would put money on this. Anyone up for a fun wager via paypal let me know (10-20 bucks or something).

[Bugs]

Temecula and Murietta got nailed the last time around, partly because they were more of a bedroom community at that time. Now they’ve got a lot more businesses in town, and they’re starting to come into their own more as a population center. I’d just about compare Temecula to Escondido, only newer and nicer. I’m thinking that this time around the declines won’t be as bad compared to other areas as last time, but they’ll still be significant.

I think you might have a shot at getting that $550k (peak) house at $350,000 if you can hold out long enough. No matter what, time is on your side.

[little lady]

“I’m thinking that this time around the declines won’t be as bad compared to other areas as last time, but they’ll still be significant.”

Go on craiglist, there are bunch of short sales and banked owned properties already, I don’t think that’s a good sign for that area.

[mydogsarelazy]

Here are some pluses and minuses for Temecula Murrieta:

Plus

It isn’t Hemet
Many new restaurants, shops and attractions are opening
Great schools
A good family area

Minus

The Murrieta real estate scam is going to put thousands of homes into repo

Many people here are in over their heads

All in all, I think in 6 months to a year you can get that $550 place for closer to $400.

Just my opinion…

JS

[hipmatt]

Temecula pros and cons
Pros:
-great weather, I mean GREAT weather (many sunny days)
-one of least smoggy cities in socal(afternoon breeze common)
-general topography is attractive(natural rolling hills/trees)
-relatively close to mountains, beaches, deserts, big cities(LA/SD)
-nice wineries(kind of)and old town(kind of)
-pretty clean and safe
-seems to be great for families and kids(tons of
schools/activities/sports, good schools)
-many churches
-decent amount of parks
-best city planning of all nearby cities(clearly not perfect)
-some nice dinning options
-still some ranches/equestrian left
-Pechanga Casino?(mostly a big CON for me)
-busy mall

Cons:
-growing way too fast
-city traffic is horrible& murrieta even worse
-freeway traffic horrible at times(215 is the worst)
-expensive homes(by nature this may end soon)
-limited singles activity/nightlife
-most careers are in retail/education/Guidant Corp./real estate:( ,very few college degree or corporate type jobs here
-most people with real jobs commute to SD/OC/LA/Riverside and with BAD traffic getting worse and pricey gas getting pricier this is a BIG Con!!!
-even though many, many dinning options, waits can still be over an hour
-Pechanga Casino – causes traffic, gambling addictions, alcoholism, promotes the evil and sin in many(just my .02)
-rat race is here to stay(people in New York City appear to be more mellow)
-rude/materialistic/overly vain/fake/snobby population growing at an alarming rate. The keeping up with the Jonse’s reality show should be filmed here.
-not the quiet ranch like town it once was
-mass transit hasn’t really arrived yet?
-very inconsiderate drivers and many times dangerous. Local drivers are the worst and rudest I’ve seen, yet they seem to be ignored by local PD especially Murrieta PD, but you will get pulled over for tinted windows.
-busy mall is packed full of “Mall Rats” who feast on energy drinks and vanity.
-culturally not that diverse
-Medical facilities are sub-par, packed, and just suck. Best local hospital is in Fallbrook. The two in Murrieta are bad.
-no local rivers and the few local lakes we have are filthy/crowded or not suitable for recreation
-closest 4 year college over 35 min away
-closest community college is 20 min away and is mediocre
-DMV, Costco, IN’n’OUT are BERSERK and require extreme patience almost all the time!!
-even though the city is growing fast and many people live here, it seems that your business still becomes everyone’s business

[anxvariety]

Temecula = landlocked circuit board of mice wheels / future ghost town / salton sea / walmart version of orange county

[sddreaming]

Here is an example of the last down turn in Temecula. There was a 10 acre equestrian property in the De Luz area, with a nice home and nice facilities. It went on the market for $850K. At that time, this was a pretty high price. One year later I put an offer on it for $225K. My offer was too late. It actually sold for $220K. Be patient. Temecula and Murrieta will again be hit hard. Sure there’s more going on there now, but it’s also way over built. As prices go down in Escondido, San Marcos, and Oceanside, San Deigo commuters will be attracted to those areas. I bet the percentage of people who live and work in the Temecula area is pretty low. Again, be patient. No one knows how low it will go, but I doubt we’re near the bottom yet.

[23109VC]

one VERY true aspect of Temecula/Murrieta is tha virtually NO ONE who lives here works here. I am int he minority. I work locally…and LOVE the fact that I live 5 minutes from my office. But if you look at the 15/215 freeway in the morning, there is a MASSIVE outflux of people LEAVING for work. in the evenings, there is a massive INFLUX of people coming home from work. PILES of people here work in San Diego and OC. They put up wih the massive commute b/c of the lower housing prices.

I do agree that as prices in the areas they work in go down, they will leave. The gas costs must be killing those people. With a commute like that…it’s easy to be spedning $500+/month on fuel. with dropping housing prices, that would go a long way toward rent/mortgate payments.

I am going to sit tight for now. I have no urgent need to buy. I am quite happy in my rental. the owner may sell, and I’ll have to move *if* she can unload the place… but as prices finally settle down…I’ll be able to pick up a NICE house, 5 minutes from my office… 🙂

[DaisyDuke]

My two cents to the original post . . .

Wait as long as you comfortably can. If you find the property you love and it is priced right, then perhaps that is the time to buy. I say “love” . . . so you better LOVE it.

My recipe as one who just left the OC homeownership club . . .

Generally, figure our the historical Year Over Year appreciation in your area for the last 10 to 15 years. Then, take the value of your property at the beginning of say 1998 and then calculate the Y-O-Y appreciation up to the current date. If you find that a property is “reasonably” within a comfort zone for you if you LOVE the property, then that might be the buy for you. If it is still out of the ballpark, then decide whether that piece is worth the added cost for 30 years. If so, buy the house. If not, wait awhile longer and save yourself another year’s salary.

DD

[kev374]

wait until fundamentals somewhat make sense, i.e. median income can qualify for a 20% down, 30yr fixed at the tried and tested 28/36 ratios and rents are somewhat in line with mortgage payments. I’m not saying you should try to time the market and wait for the absolute bottom but somewhere near it where things start making sense economically is good enough 🙂 Currently it means waiting for roughly a 50% drop in the median price to around $300k or so. Trust me it will happen because the economic fundamentals only support that price point and sooner or later equilibrium has to be reached.

Yes, the upcoming crash is going to send shockwaves through the economy but I recall Newtons law here – every action has an equal and opposite reaction, we have had tremendous boom times without any justification for it, now we have to endure the hangover of an equal magnitude.

[hipmatt]

I agree with kev374!

[hipmatt]

The bigger they are, the harder they fall!

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