taking the plunge, now give it to me straight

[gdcox]

Off subject somewhat, Vacaville seems to be distinguished by being too far from a railway. Not a thought you hear in SD of course , but relevant in SF. If a person is an SF commuter, access to the Bart for example is important. And the bart goes out the same distance as Vacaville in certain directions (eg Dublin).

By the same token, why didn’t the state government require those hundreds of developers and landowner sellers in places like Vacaville to fund a mass transit system from their profits . Did they think that would be communism?

[Diego Mamani]

I thought it made sense for you to buy until I read that you may not stay put long enough. Then this finally put the nail on the coffin:

“We want to keep our options open so when higher-end homes in the Bay area become reasonable we can make the jump.”

Obviously you don’t like Vacaville for the long term! You really want to live in the Bay Area. My advice to you: don’t buy! Even if for some miraculous reason your house does not drop in price, you’ll still have transaction costs to pay when you sell to move to the Bay Area. (But we do know that prices still have a lot to drop, especially in Vacaville.)

Even with a newer house, “ownership” translates to countless trips to Home Depot and hours spent on the yard and other related activities that your landlord should be taking care of. Did you account for this in your rent-vs-buy calculation? House “ownership” really robs you of your leisure time and time with your family, unless you really enjoy gardening, hanging curtains, adding shelves, replacing tiles, etc., etc., etc.

If this house and area are not your first choice for the long term, don’t buy! Keep enjoying the renter’s good life until house prices in your preferred location come down to affordable levels.

[Diego Mamani]

I thought it made sense for you to buy until I read that you may not stay put long enough. Then this finally put the nail on the coffin:

“We want to keep our options open so when higher-end homes in the Bay area become reasonable we can make the jump.”

Obviously you don’t like Vacaville for the long term! You really want to live in the Bay Area. My advice to you: don’t buy! Even if for some miraculous reason your house does not drop in price, you’ll still have transaction costs to pay when you sell to move to the Bay Area. (But we do know that prices still have a lot to drop, especially in Vacaville.)

Even with a newer house, “ownership” translates to countless trips to Home Depot and hours spent on the yard and other related activities that your landlord should be taking care of. Did you account for this in your rent-vs-buy calculation? House “ownership” really robs you of your leisure time and time with your family, unless you really enjoy gardening, hanging curtains, adding shelves, replacing tiles, etc., etc., etc.

If this house and area are not your first choice for the long term, don’t buy! Keep enjoying the renter’s good life until house prices in your preferred location come down to affordable levels.

[Diego Mamani]

I thought it made sense for you to buy until I read that you may not stay put long enough. Then this finally put the nail on the coffin:

“We want to keep our options open so when higher-end homes in the Bay area become reasonable we can make the jump.”

Obviously you don’t like Vacaville for the long term! You really want to live in the Bay Area. My advice to you: don’t buy! Even if for some miraculous reason your house does not drop in price, you’ll still have transaction costs to pay when you sell to move to the Bay Area. (But we do know that prices still have a lot to drop, especially in Vacaville.)

Even with a newer house, “ownership” translates to countless trips to Home Depot and hours spent on the yard and other related activities that your landlord should be taking care of. Did you account for this in your rent-vs-buy calculation? House “ownership” really robs you of your leisure time and time with your family, unless you really enjoy gardening, hanging curtains, adding shelves, replacing tiles, etc., etc., etc.

If this house and area are not your first choice for the long term, don’t buy! Keep enjoying the renter’s good life until house prices in your preferred location come down to affordable levels.

[Diego Mamani]

I thought it made sense for you to buy until I read that you may not stay put long enough. Then this finally put the nail on the coffin:

“We want to keep our options open so when higher-end homes in the Bay area become reasonable we can make the jump.”

Obviously you don’t like Vacaville for the long term! You really want to live in the Bay Area. My advice to you: don’t buy! Even if for some miraculous reason your house does not drop in price, you’ll still have transaction costs to pay when you sell to move to the Bay Area. (But we do know that prices still have a lot to drop, especially in Vacaville.)

Even with a newer house, “ownership” translates to countless trips to Home Depot and hours spent on the yard and other related activities that your landlord should be taking care of. Did you account for this in your rent-vs-buy calculation? House “ownership” really robs you of your leisure time and time with your family, unless you really enjoy gardening, hanging curtains, adding shelves, replacing tiles, etc., etc., etc.

If this house and area are not your first choice for the long term, don’t buy! Keep enjoying the renter’s good life until house prices in your preferred location come down to affordable levels.

[Diego Mamani]

I thought it made sense for you to buy until I read that you may not stay put long enough. Then this finally put the nail on the coffin:

“We want to keep our options open so when higher-end homes in the Bay area become reasonable we can make the jump.”

Obviously you don’t like Vacaville for the long term! You really want to live in the Bay Area. My advice to you: don’t buy! Even if for some miraculous reason your house does not drop in price, you’ll still have transaction costs to pay when you sell to move to the Bay Area. (But we do know that prices still have a lot to drop, especially in Vacaville.)

Even with a newer house, “ownership” translates to countless trips to Home Depot and hours spent on the yard and other related activities that your landlord should be taking care of. Did you account for this in your rent-vs-buy calculation? House “ownership” really robs you of your leisure time and time with your family, unless you really enjoy gardening, hanging curtains, adding shelves, replacing tiles, etc., etc., etc.

If this house and area are not your first choice for the long term, don’t buy! Keep enjoying the renter’s good life until house prices in your preferred location come down to affordable levels.

[surveyor]

oh yeah

By the same token, why didn’t the state government require those hundreds of developers and landowner sellers in places like Vacaville to fund a mass transit system from their profits . Did they think that would be communism?

Uh huh, if you think that home prices are expensive now, just wait until some requirement like that is put into place. It’ll make the bubble gosh darn cheap.

First rule of business – costs are passed on to the eventual buyers. If you can’t do anything with a reasonable amount of profit, then it’s better to just not do it at all.

[surveyor]

oh yeah

By the same token, why didn’t the state government require those hundreds of developers and landowner sellers in places like Vacaville to fund a mass transit system from their profits . Did they think that would be communism?

Uh huh, if you think that home prices are expensive now, just wait until some requirement like that is put into place. It’ll make the bubble gosh darn cheap.

First rule of business – costs are passed on to the eventual buyers. If you can’t do anything with a reasonable amount of profit, then it’s better to just not do it at all.

[surveyor]

oh yeah

By the same token, why didn’t the state government require those hundreds of developers and landowner sellers in places like Vacaville to fund a mass transit system from their profits . Did they think that would be communism?

Uh huh, if you think that home prices are expensive now, just wait until some requirement like that is put into place. It’ll make the bubble gosh darn cheap.

First rule of business – costs are passed on to the eventual buyers. If you can’t do anything with a reasonable amount of profit, then it’s better to just not do it at all.

[surveyor]

oh yeah

By the same token, why didn’t the state government require those hundreds of developers and landowner sellers in places like Vacaville to fund a mass transit system from their profits . Did they think that would be communism?

Uh huh, if you think that home prices are expensive now, just wait until some requirement like that is put into place. It’ll make the bubble gosh darn cheap.

First rule of business – costs are passed on to the eventual buyers. If you can’t do anything with a reasonable amount of profit, then it’s better to just not do it at all.

[surveyor]

oh yeah

By the same token, why didn’t the state government require those hundreds of developers and landowner sellers in places like Vacaville to fund a mass transit system from their profits . Did they think that would be communism?

Uh huh, if you think that home prices are expensive now, just wait until some requirement like that is put into place. It’ll make the bubble gosh darn cheap.

First rule of business – costs are passed on to the eventual buyers. If you can’t do anything with a reasonable amount of profit, then it’s better to just not do it at all.

[ltokuda]

I thought it made sense for you to buy until I read that you may not stay put long enough. Then this finally put the nail on the coffin:

"We want to keep our options open so when higher-end homes in the Bay area become reasonable we can make the jump."

Obviously you don't like Vacaville for the long term! You really want to live in the Bay Area.

I agree with Diego.  You had me convinced until I read that statement.  It seems like you're trying to convince yourself that you want to buy that house when, in fact, you really don't want to live there.  I have to take back my "go for it" recommendation.  Although I won't go as far as recommending against it.

Just for reference, I did the buy vs. rent calculation on your house.  The equivalent rent (on a $470,000 house) would have to be about $3100 for the "buy=rent" equation to hold true.  This assumes that you will live in the house.

If you purchase this home for $470,000 and rent it out, you would have to charge about $4100/month to break even.  This calculation assumes a 5% down payment and an 8% vacancy rate.  So if you buy another house in the Bay Area and want to rent this one out, you would need the rents to increase by 30% for you to break even on the initial cash flow.

If you were to rent this house out for $3100/month and you wanted to break even on the cash flow, then you would only want to pay about $350,000 for this house.  Again, I assume 5% down, 8% vacancy.  I would expect $350,000 to be very close to a hard bottom in today's dollars.  That's how low I think it could possible go … not that it will ever get there.

If the market drops more and you decide to purchase another home in the Bay Area, you will probably be upsidedown on your first house.  Its also likely that if you rent it out, you'll be losing money every month for years to come.  If you could stomach the idea of walking out of your first home, it would be a great option at that point.

[ltokuda]

I thought it made sense for you to buy until I read that you may not stay put long enough. Then this finally put the nail on the coffin:

"We want to keep our options open so when higher-end homes in the Bay area become reasonable we can make the jump."

Obviously you don't like Vacaville for the long term! You really want to live in the Bay Area.

I agree with Diego.  You had me convinced until I read that statement.  It seems like you're trying to convince yourself that you want to buy that house when, in fact, you really don't want to live there.  I have to take back my "go for it" recommendation.  Although I won't go as far as recommending against it.

Just for reference, I did the buy vs. rent calculation on your house.  The equivalent rent (on a $470,000 house) would have to be about $3100 for the "buy=rent" equation to hold true.  This assumes that you will live in the house.

If you purchase this home for $470,000 and rent it out, you would have to charge about $4100/month to break even.  This calculation assumes a 5% down payment and an 8% vacancy rate.  So if you buy another house in the Bay Area and want to rent this one out, you would need the rents to increase by 30% for you to break even on the initial cash flow.

If you were to rent this house out for $3100/month and you wanted to break even on the cash flow, then you would only want to pay about $350,000 for this house.  Again, I assume 5% down, 8% vacancy.  I would expect $350,000 to be very close to a hard bottom in today's dollars.  That's how low I think it could possible go … not that it will ever get there.

If the market drops more and you decide to purchase another home in the Bay Area, you will probably be upsidedown on your first house.  Its also likely that if you rent it out, you'll be losing money every month for years to come.  If you could stomach the idea of walking out of your first home, it would be a great option at that point.

[ltokuda]

I thought it made sense for you to buy until I read that you may not stay put long enough. Then this finally put the nail on the coffin:

"We want to keep our options open so when higher-end homes in the Bay area become reasonable we can make the jump."

Obviously you don't like Vacaville for the long term! You really want to live in the Bay Area.

I agree with Diego.  You had me convinced until I read that statement.  It seems like you're trying to convince yourself that you want to buy that house when, in fact, you really don't want to live there.  I have to take back my "go for it" recommendation.  Although I won't go as far as recommending against it.

Just for reference, I did the buy vs. rent calculation on your house.  The equivalent rent (on a $470,000 house) would have to be about $3100 for the "buy=rent" equation to hold true.  This assumes that you will live in the house.

If you purchase this home for $470,000 and rent it out, you would have to charge about $4100/month to break even.  This calculation assumes a 5% down payment and an 8% vacancy rate.  So if you buy another house in the Bay Area and want to rent this one out, you would need the rents to increase by 30% for you to break even on the initial cash flow.

If you were to rent this house out for $3100/month and you wanted to break even on the cash flow, then you would only want to pay about $350,000 for this house.  Again, I assume 5% down, 8% vacancy.  I would expect $350,000 to be very close to a hard bottom in today's dollars.  That's how low I think it could possible go … not that it will ever get there.

If the market drops more and you decide to purchase another home in the Bay Area, you will probably be upsidedown on your first house.  Its also likely that if you rent it out, you'll be losing money every month for years to come.  If you could stomach the idea of walking out of your first home, it would be a great option at that point.

[ltokuda]

I thought it made sense for you to buy until I read that you may not stay put long enough. Then this finally put the nail on the coffin:

"We want to keep our options open so when higher-end homes in the Bay area become reasonable we can make the jump."

Obviously you don't like Vacaville for the long term! You really want to live in the Bay Area.

I agree with Diego.  You had me convinced until I read that statement.  It seems like you're trying to convince yourself that you want to buy that house when, in fact, you really don't want to live there.  I have to take back my "go for it" recommendation.  Although I won't go as far as recommending against it.

Just for reference, I did the buy vs. rent calculation on your house.  The equivalent rent (on a $470,000 house) would have to be about $3100 for the "buy=rent" equation to hold true.  This assumes that you will live in the house.

If you purchase this home for $470,000 and rent it out, you would have to charge about $4100/month to break even.  This calculation assumes a 5% down payment and an 8% vacancy rate.  So if you buy another house in the Bay Area and want to rent this one out, you would need the rents to increase by 30% for you to break even on the initial cash flow.

If you were to rent this house out for $3100/month and you wanted to break even on the cash flow, then you would only want to pay about $350,000 for this house.  Again, I assume 5% down, 8% vacancy.  I would expect $350,000 to be very close to a hard bottom in today's dollars.  That's how low I think it could possible go … not that it will ever get there.

If the market drops more and you decide to purchase another home in the Bay Area, you will probably be upsidedown on your first house.  Its also likely that if you rent it out, you'll be losing money every month for years to come.  If you could stomach the idea of walking out of your first home, it would be a great option at that point.

[Author]

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