Relocating from SD to OC

[patientlywaiting]

This is a hard question to answer.

The problem with buying at the wrong time is that in today’s job market, most workers end up changing companies once every 5 years. Then intention to stay for the long haul doesn’t always equate the ability to stay for the long term.

If I were you, I’d sell and try to get my money back. Then I’d rent in OC. That’s because I’m pretty bearish about prices. I believe we’ll see 2000 prices again in SD. Your decision might be different if you think that prices will hold up.

Commuting such a long way is very costly in terms of transportation costs and wear and tear on the human body.

Best of luck to you and your family.

[SD Realtor]

Yeah I was gonna recommend the Solana Beach station… I kind of figured that commute would add up.. You pretty much summed it up well.

Lets talk about using the home as a rental. Not a bad idea at all if you make a few assumptions. First off, if you turn the home into a rental, I would make the assumption that you will indeed be keeping the home for a long time. I honestly don’t believe, (and this is ONLY AN OPINION, very speculative and not backed by any facts) that the market in CV will NOT be higher in 5 years from now as it is today. So that would presume that you would rent the home and it would continue to be a rental for you 5 years from now.

Also if you do rent the home out, you may want to use a property manager that gives you some options. Some PMs have a full service approach where they find a tenant from you, then they also maintain the home for you as well by taking a cut of the rent. Some of them have options where they just find a qualified tenant for you and put them under contract. Then you take over from there. You only get charged once which is nice. Depending on the quality of the tenant and the condition of your home, you may not need to give up so much of the rent to your PM. It is your call to make. Personally I don’t need or use a PM with my properties but that is me. Again, you need to measure your own capability.

As far as the tax liability goes, yeah I know that pain. Having rented the past few years I get killed on taxes and I hate it. However I think by only looking at taxes you may be missing out on the big picture. If you are going to do a correct calculation, you need to figure out how much you would be saving if you did sell your home. So no more property tax, no more HOA/MR fees, and you whatever cash you get back, you would be making a return (albeit a low one) on the money from the sale. Meanwhile, your cash is gaining interest, and it while it may be losing ground due to inflation, it will be gaining ground on housing. That is housing depreciation will be occurring faster then inflation, (hopefully). Otherwise those of us who are sitting on cash are indeed fools.

So the point is that in order for you to make a “fair” assessment of the sell now or not sell now decision, you need to run some numbers INCLUDING some possible future tax returns.

********

So here is a question… let’s say you kept this home as a rental and moved up there. Then let’s say you started to just stock up on cash. Save save save and keep saving. In a couple of years do you think you could afford to buy up there without selling your home?

SD Realtor

[SD Realtor]

Yeah I was gonna recommend the Solana Beach station… I kind of figured that commute would add up.. You pretty much summed it up well.

Lets talk about using the home as a rental. Not a bad idea at all if you make a few assumptions. First off, if you turn the home into a rental, I would make the assumption that you will indeed be keeping the home for a long time. I honestly don’t believe, (and this is ONLY AN OPINION, very speculative and not backed by any facts) that the market in CV will NOT be higher in 5 years from now as it is today. So that would presume that you would rent the home and it would continue to be a rental for you 5 years from now.

Also if you do rent the home out, you may want to use a property manager that gives you some options. Some PMs have a full service approach where they find a tenant from you, then they also maintain the home for you as well by taking a cut of the rent. Some of them have options where they just find a qualified tenant for you and put them under contract. Then you take over from there. You only get charged once which is nice. Depending on the quality of the tenant and the condition of your home, you may not need to give up so much of the rent to your PM. It is your call to make. Personally I don’t need or use a PM with my properties but that is me. Again, you need to measure your own capability.

As far as the tax liability goes, yeah I know that pain. Having rented the past few years I get killed on taxes and I hate it. However I think by only looking at taxes you may be missing out on the big picture. If you are going to do a correct calculation, you need to figure out how much you would be saving if you did sell your home. So no more property tax, no more HOA/MR fees, and you whatever cash you get back, you would be making a return (albeit a low one) on the money from the sale. Meanwhile, your cash is gaining interest, and it while it may be losing ground due to inflation, it will be gaining ground on housing. That is housing depreciation will be occurring faster then inflation, (hopefully). Otherwise those of us who are sitting on cash are indeed fools.

So the point is that in order for you to make a “fair” assessment of the sell now or not sell now decision, you need to run some numbers INCLUDING some possible future tax returns.

********

So here is a question… let’s say you kept this home as a rental and moved up there. Then let’s say you started to just stock up on cash. Save save save and keep saving. In a couple of years do you think you could afford to buy up there without selling your home?

SD Realtor

[SD Realtor]

Yeah I was gonna recommend the Solana Beach station… I kind of figured that commute would add up.. You pretty much summed it up well.

Lets talk about using the home as a rental. Not a bad idea at all if you make a few assumptions. First off, if you turn the home into a rental, I would make the assumption that you will indeed be keeping the home for a long time. I honestly don’t believe, (and this is ONLY AN OPINION, very speculative and not backed by any facts) that the market in CV will NOT be higher in 5 years from now as it is today. So that would presume that you would rent the home and it would continue to be a rental for you 5 years from now.

Also if you do rent the home out, you may want to use a property manager that gives you some options. Some PMs have a full service approach where they find a tenant from you, then they also maintain the home for you as well by taking a cut of the rent. Some of them have options where they just find a qualified tenant for you and put them under contract. Then you take over from there. You only get charged once which is nice. Depending on the quality of the tenant and the condition of your home, you may not need to give up so much of the rent to your PM. It is your call to make. Personally I don’t need or use a PM with my properties but that is me. Again, you need to measure your own capability.

As far as the tax liability goes, yeah I know that pain. Having rented the past few years I get killed on taxes and I hate it. However I think by only looking at taxes you may be missing out on the big picture. If you are going to do a correct calculation, you need to figure out how much you would be saving if you did sell your home. So no more property tax, no more HOA/MR fees, and you whatever cash you get back, you would be making a return (albeit a low one) on the money from the sale. Meanwhile, your cash is gaining interest, and it while it may be losing ground due to inflation, it will be gaining ground on housing. That is housing depreciation will be occurring faster then inflation, (hopefully). Otherwise those of us who are sitting on cash are indeed fools.

So the point is that in order for you to make a “fair” assessment of the sell now or not sell now decision, you need to run some numbers INCLUDING some possible future tax returns.

********

So here is a question… let’s say you kept this home as a rental and moved up there. Then let’s say you started to just stock up on cash. Save save save and keep saving. In a couple of years do you think you could afford to buy up there without selling your home?

SD Realtor

[SD Realtor]

Yeah I was gonna recommend the Solana Beach station… I kind of figured that commute would add up.. You pretty much summed it up well.

Lets talk about using the home as a rental. Not a bad idea at all if you make a few assumptions. First off, if you turn the home into a rental, I would make the assumption that you will indeed be keeping the home for a long time. I honestly don’t believe, (and this is ONLY AN OPINION, very speculative and not backed by any facts) that the market in CV will NOT be higher in 5 years from now as it is today. So that would presume that you would rent the home and it would continue to be a rental for you 5 years from now.

Also if you do rent the home out, you may want to use a property manager that gives you some options. Some PMs have a full service approach where they find a tenant from you, then they also maintain the home for you as well by taking a cut of the rent. Some of them have options where they just find a qualified tenant for you and put them under contract. Then you take over from there. You only get charged once which is nice. Depending on the quality of the tenant and the condition of your home, you may not need to give up so much of the rent to your PM. It is your call to make. Personally I don’t need or use a PM with my properties but that is me. Again, you need to measure your own capability.

As far as the tax liability goes, yeah I know that pain. Having rented the past few years I get killed on taxes and I hate it. However I think by only looking at taxes you may be missing out on the big picture. If you are going to do a correct calculation, you need to figure out how much you would be saving if you did sell your home. So no more property tax, no more HOA/MR fees, and you whatever cash you get back, you would be making a return (albeit a low one) on the money from the sale. Meanwhile, your cash is gaining interest, and it while it may be losing ground due to inflation, it will be gaining ground on housing. That is housing depreciation will be occurring faster then inflation, (hopefully). Otherwise those of us who are sitting on cash are indeed fools.

So the point is that in order for you to make a “fair” assessment of the sell now or not sell now decision, you need to run some numbers INCLUDING some possible future tax returns.

********

So here is a question… let’s say you kept this home as a rental and moved up there. Then let’s say you started to just stock up on cash. Save save save and keep saving. In a couple of years do you think you could afford to buy up there without selling your home?

SD Realtor

[SD Realtor]

Yeah I was gonna recommend the Solana Beach station… I kind of figured that commute would add up.. You pretty much summed it up well.

Lets talk about using the home as a rental. Not a bad idea at all if you make a few assumptions. First off, if you turn the home into a rental, I would make the assumption that you will indeed be keeping the home for a long time. I honestly don’t believe, (and this is ONLY AN OPINION, very speculative and not backed by any facts) that the market in CV will NOT be higher in 5 years from now as it is today. So that would presume that you would rent the home and it would continue to be a rental for you 5 years from now.

Also if you do rent the home out, you may want to use a property manager that gives you some options. Some PMs have a full service approach where they find a tenant from you, then they also maintain the home for you as well by taking a cut of the rent. Some of them have options where they just find a qualified tenant for you and put them under contract. Then you take over from there. You only get charged once which is nice. Depending on the quality of the tenant and the condition of your home, you may not need to give up so much of the rent to your PM. It is your call to make. Personally I don’t need or use a PM with my properties but that is me. Again, you need to measure your own capability.

As far as the tax liability goes, yeah I know that pain. Having rented the past few years I get killed on taxes and I hate it. However I think by only looking at taxes you may be missing out on the big picture. If you are going to do a correct calculation, you need to figure out how much you would be saving if you did sell your home. So no more property tax, no more HOA/MR fees, and you whatever cash you get back, you would be making a return (albeit a low one) on the money from the sale. Meanwhile, your cash is gaining interest, and it while it may be losing ground due to inflation, it will be gaining ground on housing. That is housing depreciation will be occurring faster then inflation, (hopefully). Otherwise those of us who are sitting on cash are indeed fools.

So the point is that in order for you to make a “fair” assessment of the sell now or not sell now decision, you need to run some numbers INCLUDING some possible future tax returns.

********

So here is a question… let’s say you kept this home as a rental and moved up there. Then let’s say you started to just stock up on cash. Save save save and keep saving. In a couple of years do you think you could afford to buy up there without selling your home?

SD Realtor

[(former)FormerSanDiegan]

Look at it this way. You will own the SD home free-and-clear in 15 years if you hold it and rent it out. Since you have positive cash flow, a tenant will be paying for the remainder of the loan for you. My guess is that 15 years from now the price of that property will be higher than today. Seems like a good position to be in.

I would rent out your existing home.
I would also rent in the OC until :
a. You are sick of the OC and want to move back
OR
b. Get accustomed to OC after a couple years and buy into a market bottom there in 2010-2011.

[(former)FormerSanDiegan]

Look at it this way. You will own the SD home free-and-clear in 15 years if you hold it and rent it out. Since you have positive cash flow, a tenant will be paying for the remainder of the loan for you. My guess is that 15 years from now the price of that property will be higher than today. Seems like a good position to be in.

I would rent out your existing home.
I would also rent in the OC until :
a. You are sick of the OC and want to move back
OR
b. Get accustomed to OC after a couple years and buy into a market bottom there in 2010-2011.

[(former)FormerSanDiegan]

Look at it this way. You will own the SD home free-and-clear in 15 years if you hold it and rent it out. Since you have positive cash flow, a tenant will be paying for the remainder of the loan for you. My guess is that 15 years from now the price of that property will be higher than today. Seems like a good position to be in.

I would rent out your existing home.
I would also rent in the OC until :
a. You are sick of the OC and want to move back
OR
b. Get accustomed to OC after a couple years and buy into a market bottom there in 2010-2011.

[(former)FormerSanDiegan]

Look at it this way. You will own the SD home free-and-clear in 15 years if you hold it and rent it out. Since you have positive cash flow, a tenant will be paying for the remainder of the loan for you. My guess is that 15 years from now the price of that property will be higher than today. Seems like a good position to be in.

I would rent out your existing home.
I would also rent in the OC until :
a. You are sick of the OC and want to move back
OR
b. Get accustomed to OC after a couple years and buy into a market bottom there in 2010-2011.

[(former)FormerSanDiegan]

Look at it this way. You will own the SD home free-and-clear in 15 years if you hold it and rent it out. Since you have positive cash flow, a tenant will be paying for the remainder of the loan for you. My guess is that 15 years from now the price of that property will be higher than today. Seems like a good position to be in.

I would rent out your existing home.
I would also rent in the OC until :
a. You are sick of the OC and want to move back
OR
b. Get accustomed to OC after a couple years and buy into a market bottom there in 2010-2011.

[sd2oc]

thank you all for your insightful comments! in answer to SD Realtor’s question, if we rented out our SD home, moved to OC, and just started stockpiling money for 2-3 years, then yes, we would probably be able to afford to buy up there without selling our home in SD (this process would be accelerated in the event of more OC declines/slowed in the event of a faster OC recovery). Former San Diegan, you make a good point about us owning the home free and clear in 15 (now 13 =) years, and in the meantime having someone pay our mortgage for us while we still get to deduct interest and property taxes. do even the most bearish of bears on this forum think the house will be worth more in 13 years than it is now (independent of inflation, that is)?

[sd2oc]

thank you all for your insightful comments! in answer to SD Realtor’s question, if we rented out our SD home, moved to OC, and just started stockpiling money for 2-3 years, then yes, we would probably be able to afford to buy up there without selling our home in SD (this process would be accelerated in the event of more OC declines/slowed in the event of a faster OC recovery). Former San Diegan, you make a good point about us owning the home free and clear in 15 (now 13 =) years, and in the meantime having someone pay our mortgage for us while we still get to deduct interest and property taxes. do even the most bearish of bears on this forum think the house will be worth more in 13 years than it is now (independent of inflation, that is)?

[sd2oc]

thank you all for your insightful comments! in answer to SD Realtor’s question, if we rented out our SD home, moved to OC, and just started stockpiling money for 2-3 years, then yes, we would probably be able to afford to buy up there without selling our home in SD (this process would be accelerated in the event of more OC declines/slowed in the event of a faster OC recovery). Former San Diegan, you make a good point about us owning the home free and clear in 15 (now 13 =) years, and in the meantime having someone pay our mortgage for us while we still get to deduct interest and property taxes. do even the most bearish of bears on this forum think the house will be worth more in 13 years than it is now (independent of inflation, that is)?

[sd2oc]

thank you all for your insightful comments! in answer to SD Realtor’s question, if we rented out our SD home, moved to OC, and just started stockpiling money for 2-3 years, then yes, we would probably be able to afford to buy up there without selling our home in SD (this process would be accelerated in the event of more OC declines/slowed in the event of a faster OC recovery). Former San Diegan, you make a good point about us owning the home free and clear in 15 (now 13 =) years, and in the meantime having someone pay our mortgage for us while we still get to deduct interest and property taxes. do even the most bearish of bears on this forum think the house will be worth more in 13 years than it is now (independent of inflation, that is)?

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