Shall we buy or never in San Diego or wait for more depreciation?

[4plexowner]

“Interest only is nothing more than rent with risk”

amen to that!

and similarly, minimum payment on an Option ARM is worse than rent with risk – it’s rent with a death wish

[an]

[quote=temeculaguy]Here is what you are missing, 400k INTEREST ONLY LOAN!!!!

Look, I am considered a contrarian on these boards lately because I have an optimistic view of the future and have put today in perspective of where it falls in the last 20 years. I am not a “real estate is always bad, we are going to hell in a handbasket” guy. And I think you are talking yourself into bad math.

Interest only is nothing more than rent with risk. Use my formula, or at least use the fully amortized piti and ignore the tax deduction, it gets roughly cancelled out by maintenance and upkeep.[/quote]
But I think that’s what the OP is trying to say. Based on his calculation, it’s cheaper for him to rent from a bank than from a landlord (~400/month). I think 400/month is more than enough to cover any maintenance and upkeep. The only thing is, he’s not calculating into the risk of depreciation. What if price drop another 10-20%?

To be conservative, I agree with you that he should use PITI vs rent. $500k house that only rent for $2k/month is not that great. You can do much better, even in centrally located areas in San Diego. I wouldn’t go over 380-400k if it can only rent for $2k/month.

[an]

[quote=temeculaguy]Here is what you are missing, 400k INTEREST ONLY LOAN!!!!

Look, I am considered a contrarian on these boards lately because I have an optimistic view of the future and have put today in perspective of where it falls in the last 20 years. I am not a “real estate is always bad, we are going to hell in a handbasket” guy. And I think you are talking yourself into bad math.

Interest only is nothing more than rent with risk. Use my formula, or at least use the fully amortized piti and ignore the tax deduction, it gets roughly cancelled out by maintenance and upkeep.[/quote]
But I think that’s what the OP is trying to say. Based on his calculation, it’s cheaper for him to rent from a bank than from a landlord (~400/month). I think 400/month is more than enough to cover any maintenance and upkeep. The only thing is, he’s not calculating into the risk of depreciation. What if price drop another 10-20%?

To be conservative, I agree with you that he should use PITI vs rent. $500k house that only rent for $2k/month is not that great. You can do much better, even in centrally located areas in San Diego. I wouldn’t go over 380-400k if it can only rent for $2k/month.

[an]

[quote=temeculaguy]Here is what you are missing, 400k INTEREST ONLY LOAN!!!!

Look, I am considered a contrarian on these boards lately because I have an optimistic view of the future and have put today in perspective of where it falls in the last 20 years. I am not a “real estate is always bad, we are going to hell in a handbasket” guy. And I think you are talking yourself into bad math.

Interest only is nothing more than rent with risk. Use my formula, or at least use the fully amortized piti and ignore the tax deduction, it gets roughly cancelled out by maintenance and upkeep.[/quote]
But I think that’s what the OP is trying to say. Based on his calculation, it’s cheaper for him to rent from a bank than from a landlord (~400/month). I think 400/month is more than enough to cover any maintenance and upkeep. The only thing is, he’s not calculating into the risk of depreciation. What if price drop another 10-20%?

To be conservative, I agree with you that he should use PITI vs rent. $500k house that only rent for $2k/month is not that great. You can do much better, even in centrally located areas in San Diego. I wouldn’t go over 380-400k if it can only rent for $2k/month.

[an]

[quote=temeculaguy]Here is what you are missing, 400k INTEREST ONLY LOAN!!!!

Look, I am considered a contrarian on these boards lately because I have an optimistic view of the future and have put today in perspective of where it falls in the last 20 years. I am not a “real estate is always bad, we are going to hell in a handbasket” guy. And I think you are talking yourself into bad math.

Interest only is nothing more than rent with risk. Use my formula, or at least use the fully amortized piti and ignore the tax deduction, it gets roughly cancelled out by maintenance and upkeep.[/quote]
But I think that’s what the OP is trying to say. Based on his calculation, it’s cheaper for him to rent from a bank than from a landlord (~400/month). I think 400/month is more than enough to cover any maintenance and upkeep. The only thing is, he’s not calculating into the risk of depreciation. What if price drop another 10-20%?

To be conservative, I agree with you that he should use PITI vs rent. $500k house that only rent for $2k/month is not that great. You can do much better, even in centrally located areas in San Diego. I wouldn’t go over 380-400k if it can only rent for $2k/month.

[an]

[quote=temeculaguy]Here is what you are missing, 400k INTEREST ONLY LOAN!!!!

Look, I am considered a contrarian on these boards lately because I have an optimistic view of the future and have put today in perspective of where it falls in the last 20 years. I am not a “real estate is always bad, we are going to hell in a handbasket” guy. And I think you are talking yourself into bad math.

Interest only is nothing more than rent with risk. Use my formula, or at least use the fully amortized piti and ignore the tax deduction, it gets roughly cancelled out by maintenance and upkeep.[/quote]
But I think that’s what the OP is trying to say. Based on his calculation, it’s cheaper for him to rent from a bank than from a landlord (~400/month). I think 400/month is more than enough to cover any maintenance and upkeep. The only thing is, he’s not calculating into the risk of depreciation. What if price drop another 10-20%?

To be conservative, I agree with you that he should use PITI vs rent. $500k house that only rent for $2k/month is not that great. You can do much better, even in centrally located areas in San Diego. I wouldn’t go over 380-400k if it can only rent for $2k/month.

[(former)FormerSanDiegan]

[quote=temeculaguy]
I got a phone call this weekend from a friend asking my opinion if he should buy his $1500 a month rental from his landlord for 160k, I told him “absolutely, do it yesterday.” I didn’t ask if he was going to rent it out in the future, what he thought about hyperinflation, unemployment, or any other marcoeconomic issues. Simple questions is all that is needed, will it cost the same or less than rent?
[/quote]

Hey TG – If your friend gets cold feet let me know !!
Where is this ?

I wanna know where I can get 1500 on a 160K purchase.

That’s more than double the rate you can get in Central SD (e.g. low end parts of Clairemont… 1700 rent 350-400K house)

[(former)FormerSanDiegan]

[quote=temeculaguy]
I got a phone call this weekend from a friend asking my opinion if he should buy his $1500 a month rental from his landlord for 160k, I told him “absolutely, do it yesterday.” I didn’t ask if he was going to rent it out in the future, what he thought about hyperinflation, unemployment, or any other marcoeconomic issues. Simple questions is all that is needed, will it cost the same or less than rent?
[/quote]

Hey TG – If your friend gets cold feet let me know !!
Where is this ?

I wanna know where I can get 1500 on a 160K purchase.

That’s more than double the rate you can get in Central SD (e.g. low end parts of Clairemont… 1700 rent 350-400K house)

[(former)FormerSanDiegan]

[quote=temeculaguy]
I got a phone call this weekend from a friend asking my opinion if he should buy his $1500 a month rental from his landlord for 160k, I told him “absolutely, do it yesterday.” I didn’t ask if he was going to rent it out in the future, what he thought about hyperinflation, unemployment, or any other marcoeconomic issues. Simple questions is all that is needed, will it cost the same or less than rent?
[/quote]

Hey TG – If your friend gets cold feet let me know !!
Where is this ?

I wanna know where I can get 1500 on a 160K purchase.

That’s more than double the rate you can get in Central SD (e.g. low end parts of Clairemont… 1700 rent 350-400K house)

[(former)FormerSanDiegan]

[quote=temeculaguy]
I got a phone call this weekend from a friend asking my opinion if he should buy his $1500 a month rental from his landlord for 160k, I told him “absolutely, do it yesterday.” I didn’t ask if he was going to rent it out in the future, what he thought about hyperinflation, unemployment, or any other marcoeconomic issues. Simple questions is all that is needed, will it cost the same or less than rent?
[/quote]

Hey TG – If your friend gets cold feet let me know !!
Where is this ?

I wanna know where I can get 1500 on a 160K purchase.

That’s more than double the rate you can get in Central SD (e.g. low end parts of Clairemont… 1700 rent 350-400K house)

[(former)FormerSanDiegan]

[quote=temeculaguy]
I got a phone call this weekend from a friend asking my opinion if he should buy his $1500 a month rental from his landlord for 160k, I told him “absolutely, do it yesterday.” I didn’t ask if he was going to rent it out in the future, what he thought about hyperinflation, unemployment, or any other marcoeconomic issues. Simple questions is all that is needed, will it cost the same or less than rent?
[/quote]

Hey TG – If your friend gets cold feet let me know !!
Where is this ?

I wanna know where I can get 1500 on a 160K purchase.

That’s more than double the rate you can get in Central SD (e.g. low end parts of Clairemont… 1700 rent 350-400K house)

[Nor-LA-SD-guy]

[quote=FormerSanDiegan][quote=temeculaguy]
I got a phone call this weekend from a friend asking my opinion if he should buy his $1500 a month rental from his landlord for 160k, I told him “absolutely, do it yesterday.” I didn’t ask if he was going to rent it out in the future, what he thought about hyperinflation, unemployment, or any other marcoeconomic issues. Simple questions is all that is needed, will it cost the same or less than rent?
[/quote]

Hey TG – If your friend gets cold feet let me know !!
Where is this ?

I wanna know where I can get 1500 on a 160K purchase.

That’s more than double the rate you can get in Central SD (e.g. low end parts of Clairemont… 1700 rent 350-400K house)[/quote]

Pretty much all over TV (Older homes, a few newer ones as well) , People tend to focus on the Mc-mansions as a place to buy to live in TV.

That being said I think there is a lot of competition for rental properties as well but there seems to be more of them available these day’s.

[Nor-LA-SD-guy]

[quote=FormerSanDiegan][quote=temeculaguy]
I got a phone call this weekend from a friend asking my opinion if he should buy his $1500 a month rental from his landlord for 160k, I told him “absolutely, do it yesterday.” I didn’t ask if he was going to rent it out in the future, what he thought about hyperinflation, unemployment, or any other marcoeconomic issues. Simple questions is all that is needed, will it cost the same or less than rent?
[/quote]

Hey TG – If your friend gets cold feet let me know !!
Where is this ?

I wanna know where I can get 1500 on a 160K purchase.

That’s more than double the rate you can get in Central SD (e.g. low end parts of Clairemont… 1700 rent 350-400K house)[/quote]

Pretty much all over TV (Older homes, a few newer ones as well) , People tend to focus on the Mc-mansions as a place to buy to live in TV.

That being said I think there is a lot of competition for rental properties as well but there seems to be more of them available these day’s.

[Nor-LA-SD-guy]

[quote=FormerSanDiegan][quote=temeculaguy]
I got a phone call this weekend from a friend asking my opinion if he should buy his $1500 a month rental from his landlord for 160k, I told him “absolutely, do it yesterday.” I didn’t ask if he was going to rent it out in the future, what he thought about hyperinflation, unemployment, or any other marcoeconomic issues. Simple questions is all that is needed, will it cost the same or less than rent?
[/quote]

Hey TG – If your friend gets cold feet let me know !!
Where is this ?

I wanna know where I can get 1500 on a 160K purchase.

That’s more than double the rate you can get in Central SD (e.g. low end parts of Clairemont… 1700 rent 350-400K house)[/quote]

Pretty much all over TV (Older homes, a few newer ones as well) , People tend to focus on the Mc-mansions as a place to buy to live in TV.

That being said I think there is a lot of competition for rental properties as well but there seems to be more of them available these day’s.

[Nor-LA-SD-guy]

[quote=FormerSanDiegan][quote=temeculaguy]
I got a phone call this weekend from a friend asking my opinion if he should buy his $1500 a month rental from his landlord for 160k, I told him “absolutely, do it yesterday.” I didn’t ask if he was going to rent it out in the future, what he thought about hyperinflation, unemployment, or any other marcoeconomic issues. Simple questions is all that is needed, will it cost the same or less than rent?
[/quote]

Hey TG – If your friend gets cold feet let me know !!
Where is this ?

I wanna know where I can get 1500 on a 160K purchase.

That’s more than double the rate you can get in Central SD (e.g. low end parts of Clairemont… 1700 rent 350-400K house)[/quote]

Pretty much all over TV (Older homes, a few newer ones as well) , People tend to focus on the Mc-mansions as a place to buy to live in TV.

That being said I think there is a lot of competition for rental properties as well but there seems to be more of them available these day’s.

[Author]

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