Seeking advice buying in Carmel Valley vs 4S ranch

[waittobuy]

Hi asianautica. I got your points. Thanks!

[waittobuy]

Hi asianautica. I got your points. Thanks!

[fsbo]

if 4S is close to work, go for it.
To answer your second question – there are plenty of empty lots in 4S for new houses, while there aren’t many left in CV…

[fsbo]

if 4S is close to work, go for it.
To answer your second question – there are plenty of empty lots in 4S for new houses, while there aren’t many left in CV…

[SD Realtor]

I would agree with the majority of the posts. My first word of advice would be to wait. I do think you could do better waiting but I understand why you are buying now.

If you are not going to wait then go with the home that will provide more harmony for your family. Both are great school districts so you cannot go wrong with that pick. Also agreed with the point about more lots available in 4s then Portico. For the record I think there may be more defaults in 4s then in CV but it is just an opinion so take it with a grain of salt.

I think trying to speculate on which home will appreciate more is pretty tough. I am sure if someone were motivated enough they could give you appreciation numbers for each area for the past few years. I am kind of tired so sorry about that.

Anyways, go for the harmony, the better deal for the money, measure which has higher Mello Roos etc, what is better for your commute, etc…

SD Realtor

[SD Realtor]

I would agree with the majority of the posts. My first word of advice would be to wait. I do think you could do better waiting but I understand why you are buying now.

If you are not going to wait then go with the home that will provide more harmony for your family. Both are great school districts so you cannot go wrong with that pick. Also agreed with the point about more lots available in 4s then Portico. For the record I think there may be more defaults in 4s then in CV but it is just an opinion so take it with a grain of salt.

I think trying to speculate on which home will appreciate more is pretty tough. I am sure if someone were motivated enough they could give you appreciation numbers for each area for the past few years. I am kind of tired so sorry about that.

Anyways, go for the harmony, the better deal for the money, measure which has higher Mello Roos etc, what is better for your commute, etc…

SD Realtor

[Coronita]

Waittobuy,

I willingly paid a huge premium to live in CV to have access to the DelMar Union for elementary, and Carmel Valley Middle School and Torrey Pines HS.

The thing I have a beef with about Portico is that I don’t consider it really to be part of Carmel Valley, but you’re being asked to pay the premium. If you live Portico, I believe the way it works is k-6 is in Solana Beach Unified. Middle school is “anticipated” to be in Carmel Valley Middle and Torrey Pines HS OR Canyon Crest Academy. But that I think this is still subject to change. Also, I’m generally leary of brand new planned neighborhoods with a lot of promises of future infrastructure being a certain way. For example the entire Del Sur community I wouldn’t consider buying there regardless of price, until I get a clear indication that they said new planned community/infrastructure is going to happen. Seeing builders pull out is kinda alarming. Now, the Pacific Highlands Ranch area is better built out than I would say Del Sur, but unless you are sure you’re going to get access to San Dieguito Unified, I don’t think there quite a justification for the markup just from school district itself. Unfortunately, this is also why I also don’t like 4s ranch. I think of 4s ranch as “new money” or I should say “new borrowed money”….If there are too many new buyers (which sketchy financiing), and they start pulling out or getting foreclosed, it doesn’t help your property value. (2) It won’t help your surrounding infrastructure either, because not enough people will be paying taxes.

If you were my friend who was deciding between the two, I would try to talk you out of buying in both areas frankly. If you want to live in CV, wait for prices to fall so you can buy in central CV.

[Coronita]

Waittobuy,

I willingly paid a huge premium to live in CV to have access to the DelMar Union for elementary, and Carmel Valley Middle School and Torrey Pines HS.

The thing I have a beef with about Portico is that I don’t consider it really to be part of Carmel Valley, but you’re being asked to pay the premium. If you live Portico, I believe the way it works is k-6 is in Solana Beach Unified. Middle school is “anticipated” to be in Carmel Valley Middle and Torrey Pines HS OR Canyon Crest Academy. But that I think this is still subject to change. Also, I’m generally leary of brand new planned neighborhoods with a lot of promises of future infrastructure being a certain way. For example the entire Del Sur community I wouldn’t consider buying there regardless of price, until I get a clear indication that they said new planned community/infrastructure is going to happen. Seeing builders pull out is kinda alarming. Now, the Pacific Highlands Ranch area is better built out than I would say Del Sur, but unless you are sure you’re going to get access to San Dieguito Unified, I don’t think there quite a justification for the markup just from school district itself. Unfortunately, this is also why I also don’t like 4s ranch. I think of 4s ranch as “new money” or I should say “new borrowed money”….If there are too many new buyers (which sketchy financiing), and they start pulling out or getting foreclosed, it doesn’t help your property value. (2) It won’t help your surrounding infrastructure either, because not enough people will be paying taxes.

If you were my friend who was deciding between the two, I would try to talk you out of buying in both areas frankly. If you want to live in CV, wait for prices to fall so you can buy in central CV.

[temeculaguy]

I won’t bother with telling you to wait at least until the fall since other have and it’s not registering. We have a classic case of “my wife wants” and without a happy wife there is no happy life.

If it’s just about schools then find out the specific schools they will attend (district websites usually have maps on the internet, I’ve found many owners and realtors to be incorrect or not aware of planned changes). You can check their academic scores on the state website and can see demographic specifics, college acceptance rates, etc. and finally you can visit those schools in person.

I think you are going to find it will be close to a tie. Those two areas are both in the top tier of the county as far as schools go. This is very much like having a Mercedes vs BMW debate, their both great, it just comes down to preference.

[temeculaguy]

I won’t bother with telling you to wait at least until the fall since other have and it’s not registering. We have a classic case of “my wife wants” and without a happy wife there is no happy life.

If it’s just about schools then find out the specific schools they will attend (district websites usually have maps on the internet, I’ve found many owners and realtors to be incorrect or not aware of planned changes). You can check their academic scores on the state website and can see demographic specifics, college acceptance rates, etc. and finally you can visit those schools in person.

I think you are going to find it will be close to a tie. Those two areas are both in the top tier of the county as far as schools go. This is very much like having a Mercedes vs BMW debate, their both great, it just comes down to preference.

[ocrenter]

waittobuy,

if you like my blog then you know where we stand as far as how far the prices are going to fall further. so no point to repeat all of the reasons to wait once again here.

I went back and looked again at your wife’s point:

“–The rent is close to would-be monthly house payment. If we wait until summer next year, the price might be $40K less, but in the meantime we’ll have to pay for rent, part of which could have been used for principal payment.”

the whole idea here is what you are giving up in rent will be far less than what you may lose in depreciating value. We would have spend $24,000 in rent last year (we ended up spending $14,000 due to unforeseen foreclosure of our rental, but that’s another story for another day). Assuming $24,000 loss in rent, had we bought in 4S, we would have been looking at $100,000 loss in equity over the same period. had we bought in Temecula like a friend of mine did, that $24,000 loss in rent would be comparable to $200,000 loss in equity.

The question to you and your wife is are you two willing to roll the dice again this year. Remember, you would not be paying that much toward your principal the first year. Assuming price drop is only $40,000, as in your loss in rent, you come out even. But if the price drop is greater than $40,000, then that’s another story, isn’t it.

[ocrenter]

waittobuy,

if you like my blog then you know where we stand as far as how far the prices are going to fall further. so no point to repeat all of the reasons to wait once again here.

I went back and looked again at your wife’s point:

“–The rent is close to would-be monthly house payment. If we wait until summer next year, the price might be $40K less, but in the meantime we’ll have to pay for rent, part of which could have been used for principal payment.”

the whole idea here is what you are giving up in rent will be far less than what you may lose in depreciating value. We would have spend $24,000 in rent last year (we ended up spending $14,000 due to unforeseen foreclosure of our rental, but that’s another story for another day). Assuming $24,000 loss in rent, had we bought in 4S, we would have been looking at $100,000 loss in equity over the same period. had we bought in Temecula like a friend of mine did, that $24,000 loss in rent would be comparable to $200,000 loss in equity.

The question to you and your wife is are you two willing to roll the dice again this year. Remember, you would not be paying that much toward your principal the first year. Assuming price drop is only $40,000, as in your loss in rent, you come out even. But if the price drop is greater than $40,000, then that’s another story, isn’t it.

[gn]

waittobuy,

When prices go down, the less desirable areas go down first. This is why ocrenter said the following:

“Assuming $24,000 loss in rent, had we bought in 4S, we would have been looking at $100,000 loss in equity over the same period. had we bought in Temecula like a friend of mine did, that $24,000 loss in rent would be comparable to $200,000 loss in equity.”

This is because Temecula is much less desirable than 4S.

Relatively, 4S is less desirable than Carmel Valley. This is why prices in CV have held up better than 4S. When the dust settles, all areas (desirable or not) will have gone down by the same percentage. The difference is that the least desirable areas will hit the “bottom” first.

With that said, CV is further from the “bottom” than 4S. So, if you must buy right now, 4S is probably better b/c it is closer to the bottom. You’ll still lose a lot of money because 4S is still a long way from the bottom.

ocrenter made an excellent point. Financially speaking, the decision to buy does NOT depend on the rent vs. the mortgage payment. It depends on the money spend on rent vs. the equity loss.

I would suspect that: ocrenter would have paid $3k/month to rent that same house because the $36k spent on rent would still be far less than the equity loss.

“we think the biggest yearly drop in price in this cycle has happened”

Real estate is the ultimate momentum market. The price declines of the last 18 months has only began to pickup speed. So, the biggest yearly drop in price has not happened yet.

[gn]

waittobuy,

When prices go down, the less desirable areas go down first. This is why ocrenter said the following:

“Assuming $24,000 loss in rent, had we bought in 4S, we would have been looking at $100,000 loss in equity over the same period. had we bought in Temecula like a friend of mine did, that $24,000 loss in rent would be comparable to $200,000 loss in equity.”

This is because Temecula is much less desirable than 4S.

Relatively, 4S is less desirable than Carmel Valley. This is why prices in CV have held up better than 4S. When the dust settles, all areas (desirable or not) will have gone down by the same percentage. The difference is that the least desirable areas will hit the “bottom” first.

With that said, CV is further from the “bottom” than 4S. So, if you must buy right now, 4S is probably better b/c it is closer to the bottom. You’ll still lose a lot of money because 4S is still a long way from the bottom.

ocrenter made an excellent point. Financially speaking, the decision to buy does NOT depend on the rent vs. the mortgage payment. It depends on the money spend on rent vs. the equity loss.

I would suspect that: ocrenter would have paid $3k/month to rent that same house because the $36k spent on rent would still be far less than the equity loss.

“we think the biggest yearly drop in price in this cycle has happened”

Real estate is the ultimate momentum market. The price declines of the last 18 months has only began to pickup speed. So, the biggest yearly drop in price has not happened yet.

[Coronita]

waittobuy, When prices go down, the less desirable areas go down first. This is why ocrenter said the following: "Assuming $24,000 loss in rent, had we bought in 4S, we would have been looking at $100,000 loss in equity over the same period. had we bought in Temecula like a friend of mine did, that $24,000 loss in rent would be comparable to $200,000 loss in equity." This is because Temecula is much less desirable than 4S. Relatively, 4S is less desirable than Carmel Valley. This is why prices in CV have held up better than 4S. When the dust settles, all areas (desirable or not) will have gone down by the same percentage. The difference is that the least desirable areas will hit the "bottom" first. With that said, CV is further from the "bottom" than 4S. So, if you must buy right now, 4S is probably better b/c it is closer to the bottom. You'll still lose a lot of money because 4S is still a long way from the bottom. ocrenter made an excellent point. Financially speaking, the decision to buy does NOT depend on the rent vs. the mortgage payment. It depends on the money spend on rent vs. the equity loss. I would suspect that: ocrenter would have paid $3k/month to rent that same house because the $36k spent on rent would still be far less than the equity loss. "we think the biggest yearly drop in price in this cycle has happened" Real estate is the ultimate momentum market. The price declines of the last 18 months has only began to pickup speed. So, the biggest yearly drop in price has not happened yet.

 

I sort of disagree with this. One other big difference is has the cities infrastructure been rolled out… I don't think the 4S ranch infrastructure is anywhere near say old CV or rancho penisquito. if there is a deluge of foreclosures in newer areas, you're going to get hit twice. Ist in your property value, second in terms of the infrastructure your city won't have.  Take a look at Del Sur for example. It's a ghost town there.

 

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