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  • October 29, 2008 at 11:56 PM #295341
    urbanrealtor
    Participant

    [quote=SD Realtor]Hi Econ –

    I did a quick search on the MLS for 92104 under 150k. 28 listings came up and all are attached homes except for 1 detached home on Polk. Now whether they will fetch 1000 a month is something I am not sure of as I am to lazy to run rental rate comps AND work in HOA/Property taxes to calculate the true cap rate. Anyways I would imagine UR was referring to these homes[/quote]

    Thats right.
    I would also expand the zip to92116 and some very select parts of 92102 (though that is really more like south park).
    I am sure of the rental rates because recently, I have been engaged to assist buyer in getting them rented.

    Like I said that type of equation is harder to match in houses but here are some examples

    Here is a conversion project that fell apart halfway through (its at 35th and Meade):
    The cheapest 1 bedroom closed at 52k
    080042852
    The cheapest 2br closed at 80k
    086017289
    There were about 30 units in this complex that closed at similar prices.

    In the resale (non-developer) department, here is one currently being rented out for more than 8% Cap.
    081018371

    As far as houses, here is one at 37th and Polk
    086036982

    Here is a house in a nice area west of the 805.
    086017417

    Like I said, the houses are rarer and somewhat more expensive.

    However, as investments or homes go, they are not bad deals.

    Barring true economic meltdown, they are fairly safe as investements.
    All get at least 8% return consistently.
    If such a meltdown occurs (no, I don’t buy that the current crisis qualifies) then foreclosure will be the least of our worries.

    Regarding FHA loans, inspectors rarely ever show up and never after a couple months.
    I use these loans pretty exclusively and I have more familiarity than many of the loan officers I deal with (eg: how many lenders understand 203k loans?).
    I won’t help anyone do anything sketchy (like lie on a loan app) but I have had a few decide that renting made more sense after they closed on purchase.

    On a side note:
    As an agent, this means one can still make a living but the days of universally enthusiastic buyers and easy lending are way gone. For me this is great because I am better at discussing investment options and offer/negotiation strategies than I am at being a salesman in the classical sense.

    October 30, 2008 at 2:14 AM #295391
    bake
    Participant

    sd realtor i am not talking about renting these places out (i thimk urban realtor got on that track), i am making a rent vs buy comparison, ie can you buy for around what it would cost you to rent, and suggesting that if you can it would probably be a good move to buy if you know you are going to be there for a long time and you can find a home you really like. i understand all that projected rate of return on $ invested stuff, just trying to keep it simple…

    so prices haven’t droped that much in CV and some other upper middle class areas?(rich’s graphs say the same) i say they will get there, prices are still too high in those areas and the reason they haven’t come down is simply the sellers are better off with more staying power, just don’t buy until they do, what say you?

    October 30, 2008 at 2:14 AM #295413
    bake
    Participant

    sd realtor i am not talking about renting these places out (i thimk urban realtor got on that track), i am making a rent vs buy comparison, ie can you buy for around what it would cost you to rent, and suggesting that if you can it would probably be a good move to buy if you know you are going to be there for a long time and you can find a home you really like. i understand all that projected rate of return on $ invested stuff, just trying to keep it simple…

    so prices haven’t droped that much in CV and some other upper middle class areas?(rich’s graphs say the same) i say they will get there, prices are still too high in those areas and the reason they haven’t come down is simply the sellers are better off with more staying power, just don’t buy until they do, what say you?

    October 30, 2008 at 2:14 AM #295057
    bake
    Participant

    sd realtor i am not talking about renting these places out (i thimk urban realtor got on that track), i am making a rent vs buy comparison, ie can you buy for around what it would cost you to rent, and suggesting that if you can it would probably be a good move to buy if you know you are going to be there for a long time and you can find a home you really like. i understand all that projected rate of return on $ invested stuff, just trying to keep it simple…

    so prices haven’t droped that much in CV and some other upper middle class areas?(rich’s graphs say the same) i say they will get there, prices are still too high in those areas and the reason they haven’t come down is simply the sellers are better off with more staying power, just don’t buy until they do, what say you?

    October 30, 2008 at 2:14 AM #295426
    bake
    Participant

    sd realtor i am not talking about renting these places out (i thimk urban realtor got on that track), i am making a rent vs buy comparison, ie can you buy for around what it would cost you to rent, and suggesting that if you can it would probably be a good move to buy if you know you are going to be there for a long time and you can find a home you really like. i understand all that projected rate of return on $ invested stuff, just trying to keep it simple…

    so prices haven’t droped that much in CV and some other upper middle class areas?(rich’s graphs say the same) i say they will get there, prices are still too high in those areas and the reason they haven’t come down is simply the sellers are better off with more staying power, just don’t buy until they do, what say you?

    October 30, 2008 at 2:14 AM #295465
    bake
    Participant

    sd realtor i am not talking about renting these places out (i thimk urban realtor got on that track), i am making a rent vs buy comparison, ie can you buy for around what it would cost you to rent, and suggesting that if you can it would probably be a good move to buy if you know you are going to be there for a long time and you can find a home you really like. i understand all that projected rate of return on $ invested stuff, just trying to keep it simple…

    so prices haven’t droped that much in CV and some other upper middle class areas?(rich’s graphs say the same) i say they will get there, prices are still too high in those areas and the reason they haven’t come down is simply the sellers are better off with more staying power, just don’t buy until they do, what say you?

    October 30, 2008 at 9:28 AM #295510
    SD Realtor
    Participant

    lonestar I got ya. Using the rental price as a barometer for the mortgage payment is not a bad idea. You may want to adjust for taxes but I get the general idea.

    I agree that the higher priced areas will drop, the only question is by how much. That is pretty much how I felt since day one. I do feel it all depends on employment and interest rates. Patience will definitely be required. Denial runs high in these areas and people still just don’t get it for the most part and they are positioned better to throw more money away for a few more years rather then rip the bandaid off and take it now.

    Yes though, there is no doubt the higher end areas will come down and how hard is subject to debate. They will come though.

    October 30, 2008 at 9:28 AM #295102
    SD Realtor
    Participant

    lonestar I got ya. Using the rental price as a barometer for the mortgage payment is not a bad idea. You may want to adjust for taxes but I get the general idea.

    I agree that the higher priced areas will drop, the only question is by how much. That is pretty much how I felt since day one. I do feel it all depends on employment and interest rates. Patience will definitely be required. Denial runs high in these areas and people still just don’t get it for the most part and they are positioned better to throw more money away for a few more years rather then rip the bandaid off and take it now.

    Yes though, there is no doubt the higher end areas will come down and how hard is subject to debate. They will come though.

    October 30, 2008 at 9:28 AM #295436
    SD Realtor
    Participant

    lonestar I got ya. Using the rental price as a barometer for the mortgage payment is not a bad idea. You may want to adjust for taxes but I get the general idea.

    I agree that the higher priced areas will drop, the only question is by how much. That is pretty much how I felt since day one. I do feel it all depends on employment and interest rates. Patience will definitely be required. Denial runs high in these areas and people still just don’t get it for the most part and they are positioned better to throw more money away for a few more years rather then rip the bandaid off and take it now.

    Yes though, there is no doubt the higher end areas will come down and how hard is subject to debate. They will come though.

    October 30, 2008 at 9:28 AM #295458
    SD Realtor
    Participant

    lonestar I got ya. Using the rental price as a barometer for the mortgage payment is not a bad idea. You may want to adjust for taxes but I get the general idea.

    I agree that the higher priced areas will drop, the only question is by how much. That is pretty much how I felt since day one. I do feel it all depends on employment and interest rates. Patience will definitely be required. Denial runs high in these areas and people still just don’t get it for the most part and they are positioned better to throw more money away for a few more years rather then rip the bandaid off and take it now.

    Yes though, there is no doubt the higher end areas will come down and how hard is subject to debate. They will come though.

    October 30, 2008 at 9:28 AM #295472
    SD Realtor
    Participant

    lonestar I got ya. Using the rental price as a barometer for the mortgage payment is not a bad idea. You may want to adjust for taxes but I get the general idea.

    I agree that the higher priced areas will drop, the only question is by how much. That is pretty much how I felt since day one. I do feel it all depends on employment and interest rates. Patience will definitely be required. Denial runs high in these areas and people still just don’t get it for the most part and they are positioned better to throw more money away for a few more years rather then rip the bandaid off and take it now.

    Yes though, there is no doubt the higher end areas will come down and how hard is subject to debate. They will come though.

    October 30, 2008 at 11:03 AM #295476
    (former)FormerSanDiegan
    Participant

    so prices haven’t droped that much in CV and some other upper middle class areas?(rich’s graphs say the same)

    True they haven’t dropped as much, but they didn’t rise as much, either. If you look carefully at Rich’s charts (particularly the one copied below), you see that high-priced homes were not as overvalued during the bubble as the low-priced homes.
    Therefore, by the time housing bottoms I don’t think you will see the same percentage decline in the high end as we will see on the low end, for the simple fact that the price distortion was not as great at the high end.

    [img_assist|nid=9439|title=Rich Toscano HPI data|desc=|link=node|align=left|width=376|height=299]

    October 30, 2008 at 11:03 AM #295550
    (former)FormerSanDiegan
    Participant

    so prices haven’t droped that much in CV and some other upper middle class areas?(rich’s graphs say the same)

    True they haven’t dropped as much, but they didn’t rise as much, either. If you look carefully at Rich’s charts (particularly the one copied below), you see that high-priced homes were not as overvalued during the bubble as the low-priced homes.
    Therefore, by the time housing bottoms I don’t think you will see the same percentage decline in the high end as we will see on the low end, for the simple fact that the price distortion was not as great at the high end.

    [img_assist|nid=9439|title=Rich Toscano HPI data|desc=|link=node|align=left|width=376|height=299]

    October 30, 2008 at 11:03 AM #295511
    (former)FormerSanDiegan
    Participant

    so prices haven’t droped that much in CV and some other upper middle class areas?(rich’s graphs say the same)

    True they haven’t dropped as much, but they didn’t rise as much, either. If you look carefully at Rich’s charts (particularly the one copied below), you see that high-priced homes were not as overvalued during the bubble as the low-priced homes.
    Therefore, by the time housing bottoms I don’t think you will see the same percentage decline in the high end as we will see on the low end, for the simple fact that the price distortion was not as great at the high end.

    [img_assist|nid=9439|title=Rich Toscano HPI data|desc=|link=node|align=left|width=376|height=299]

    October 30, 2008 at 11:03 AM #295498
    (former)FormerSanDiegan
    Participant

    so prices haven’t droped that much in CV and some other upper middle class areas?(rich’s graphs say the same)

    True they haven’t dropped as much, but they didn’t rise as much, either. If you look carefully at Rich’s charts (particularly the one copied below), you see that high-priced homes were not as overvalued during the bubble as the low-priced homes.
    Therefore, by the time housing bottoms I don’t think you will see the same percentage decline in the high end as we will see on the low end, for the simple fact that the price distortion was not as great at the high end.

    [img_assist|nid=9439|title=Rich Toscano HPI data|desc=|link=node|align=left|width=376|height=299]

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