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May 23, 2007 at 11:40 PM #54640May 23, 2007 at 11:40 PM #54655
CoronitaParticipantWhat i don’t understand is how the heck does a person spend $700-$800k for homes in temecula? I’m sure it’s a nice home but it’s soooo far away from central san diego….
Any thoughts?
May 23, 2007 at 11:51 PM #54644cashflow
ParticipantWe went to a foreclosure auction for Riverside county last weekend. It wasn’t as busy as the San Diego auction had been. There was a home over 3k square feet that sold (subject to confirmation from the bank as it didn’t meet the reserve set) at 530K in Harveston…we noticed comps in the 700k range for the area and a home across the street that the sellers had priced at over 800k….it’s getting interesting around there for sure now!
May 23, 2007 at 11:51 PM #54659ParticipantWe went to a foreclosure auction for Riverside county last weekend. It wasn’t as busy as the San Diego auction had been. There was a home over 3k square feet that sold (subject to confirmation from the bank as it didn’t meet the reserve set) at 530K in Harveston…we noticed comps in the 700k range for the area and a home across the street that the sellers had priced at over 800k….it’s getting interesting around there for sure now!
May 23, 2007 at 11:58 PM #54649FormerOwner
Participantfat,
I’ve wondered the same thing myself. I think there are a few categories of buyers up here in Temecula:
1) People that cashed out of houses in SD and put a huge down payment on a McMansion. Their loan payments probably aren’t that bad but their commute is a nightmare and their property taxes are pretty darn high – these two things were rationalized away.
2) People that just think real estate never goes down and do anything they have to do to buy a McMansion. I suspect many of them got teaser rate loans and they will end up in foreclosure once the interest rate resets. This includes owner-occupants and investors.
3) Realtors. They seem to be drinking their own Kool-Aid up here and many of them are in trouble trying to unload “investment” properties. Good luck with that!
4) Stonewood aka mortgage scam.
5) I don’t think 1-4 account for anywhere near all of the houses sold in the last few years and I can’t imagine anyone in their right mind paying those prices to live in Temecula. I think more revelations are still to come out as the housing bubble deflates – these will shed more light on what was going on.May 23, 2007 at 11:58 PM #54663Participantfat,
I’ve wondered the same thing myself. I think there are a few categories of buyers up here in Temecula:
1) People that cashed out of houses in SD and put a huge down payment on a McMansion. Their loan payments probably aren’t that bad but their commute is a nightmare and their property taxes are pretty darn high – these two things were rationalized away.
2) People that just think real estate never goes down and do anything they have to do to buy a McMansion. I suspect many of them got teaser rate loans and they will end up in foreclosure once the interest rate resets. This includes owner-occupants and investors.
3) Realtors. They seem to be drinking their own Kool-Aid up here and many of them are in trouble trying to unload “investment” properties. Good luck with that!
4) Stonewood aka mortgage scam.
5) I don’t think 1-4 account for anywhere near all of the houses sold in the last few years and I can’t imagine anyone in their right mind paying those prices to live in Temecula. I think more revelations are still to come out as the housing bubble deflates – these will shed more light on what was going on.May 24, 2007 at 12:20 AM #54654temeculaguy
ParticipantO.K. hawk, those are fair rules. I need to research the murrieta zips before placing my bet but I will place a side wager of a shot of choice at the pub that 92592 falls last. I will gladly buy you a shot if you find me a 92592 down 50% because I’ll buy the shot and the house.
To answer the question the other poster said of why would anyone pay 500-700 for a home out here despite being far from San Diego, good question. The answer is that it is overpriced and with gas rising it will go down first but that doesn’t mean San Diego isn’t overpriced as well. The reality is that not everyone works in the city. I have mostly worked in North San Diego County for the last fifteen years and a 25 minute drive isn’t that big of a deal to me. The schools, crime rate and people are directly in comparison to Carlsbad, 4-s or Poway, well above any other reamaining N. County city and probably half the price of those three communities. They either don’t want to live in the places they can afford or they don’t actually drive to Downtown S.D. You may be suprised at the amount of jobs in North County San Diego and how expensive the housing is or how rotten the schools and neighborhoods are in the 400-500k areas of N. County. When I got out of college I got a job in Vista and the drive from San Diego took longer than the drive to work from Temecula, it was cheaper, nicer and safer than my options at the time so I moved. I can only guess that other have come over the years for similar reasons.
May 24, 2007 at 12:20 AM #54669ParticipantO.K. hawk, those are fair rules. I need to research the murrieta zips before placing my bet but I will place a side wager of a shot of choice at the pub that 92592 falls last. I will gladly buy you a shot if you find me a 92592 down 50% because I’ll buy the shot and the house.
To answer the question the other poster said of why would anyone pay 500-700 for a home out here despite being far from San Diego, good question. The answer is that it is overpriced and with gas rising it will go down first but that doesn’t mean San Diego isn’t overpriced as well. The reality is that not everyone works in the city. I have mostly worked in North San Diego County for the last fifteen years and a 25 minute drive isn’t that big of a deal to me. The schools, crime rate and people are directly in comparison to Carlsbad, 4-s or Poway, well above any other reamaining N. County city and probably half the price of those three communities. They either don’t want to live in the places they can afford or they don’t actually drive to Downtown S.D. You may be suprised at the amount of jobs in North County San Diego and how expensive the housing is or how rotten the schools and neighborhoods are in the 400-500k areas of N. County. When I got out of college I got a job in Vista and the drive from San Diego took longer than the drive to work from Temecula, it was cheaper, nicer and safer than my options at the time so I moved. I can only guess that other have come over the years for similar reasons.
May 24, 2007 at 12:27 AM #54656CoronitaParticipantO.K. hawk, those are fair rules. I need to research the murrieta zips before placing my bet but I will place a side wager of a shot of choice at the pub that 92592 falls last. I will gladly buy you a shot if you find me a 92592 down 50% because I'll buy the shot and the house. To answer the question the other poster said of why would anyone pay 500-700 for a home out here despite being far from San Diego, good question. The answer is that it is overpriced and with gas rising it will go down first but that doesn't mean San Diego isn't overpriced as well. The reality is that not everyone works in the city. I have mostly worked in North San Diego County for the last fifteen years and a 25 minute drive isn't that big of a deal to me. The schools, crime rate and people are directly in comparison to Carlsbad, 4-s or Poway, well above any other reamaining N. County city and probably half the price of those three communities. They either don't want to live in the places they can afford or they don't actually drive to Downtown S.D. You may be suprised at the amount of jobs in North County San Diego and how expensive the housing is or how rotten the schools and neighborhoods are in the 400-500k areas of N. County. When I got out of college I got a job in Vista and the drive from San Diego took longer than the drive to work from Temecula, it was cheaper, nicer and safer than my options at the time so I moved. I can only guess that other have come over the years for similar reasons.
I'm just trying to understand the rationale to buying in temecula at a high price. Because at $700k, you could buy something inland (albeit smaller yard possibly). I'm just trying to understand the rationale of why a $700k home in say temecula would make sense, but a $700k home in say 4s ranch or rancho penisquito wouldn't. I always thought that more jobs/opportunities are inland and the schools would be better, but I guess I'm wrong.
May 24, 2007 at 12:27 AM #54671CoronitaParticipantO.K. hawk, those are fair rules. I need to research the murrieta zips before placing my bet but I will place a side wager of a shot of choice at the pub that 92592 falls last. I will gladly buy you a shot if you find me a 92592 down 50% because I'll buy the shot and the house. To answer the question the other poster said of why would anyone pay 500-700 for a home out here despite being far from San Diego, good question. The answer is that it is overpriced and with gas rising it will go down first but that doesn't mean San Diego isn't overpriced as well. The reality is that not everyone works in the city. I have mostly worked in North San Diego County for the last fifteen years and a 25 minute drive isn't that big of a deal to me. The schools, crime rate and people are directly in comparison to Carlsbad, 4-s or Poway, well above any other reamaining N. County city and probably half the price of those three communities. They either don't want to live in the places they can afford or they don't actually drive to Downtown S.D. You may be suprised at the amount of jobs in North County San Diego and how expensive the housing is or how rotten the schools and neighborhoods are in the 400-500k areas of N. County. When I got out of college I got a job in Vista and the drive from San Diego took longer than the drive to work from Temecula, it was cheaper, nicer and safer than my options at the time so I moved. I can only guess that other have come over the years for similar reasons.
I'm just trying to understand the rationale to buying in temecula at a high price. Because at $700k, you could buy something inland (albeit smaller yard possibly). I'm just trying to understand the rationale of why a $700k home in say temecula would make sense, but a $700k home in say 4s ranch or rancho penisquito wouldn't. I always thought that more jobs/opportunities are inland and the schools would be better, but I guess I'm wrong.
May 24, 2007 at 12:44 AM #54661ParticipantTo answer former owner, the cash outs are a chunk of who has moved out here. My parents moved here after cashing out and paid cash (albeit they did it in 1999). They were nearing retirement so the commute didn’t affect them, they were close to the grandkids and they got a similar sized house in a similar community with the equity from their previous house. To them, the future price was a moot point. They didn’t want to move out of state and away from all of their grandkids and they got a house on a golf course in Range of the wineries without the 115 heat of many retirement areas like Arizona, Nevada or Palm Springs. They also picked up two rentals with cash that provide income. If prices do fall here first and faster than S.D. (which they will) it will be attractive to cash outs again. Never underestimate the benefit of not having a mortgage. The other reason is the Dr. Laura principle. Many couples with young kids will cash out of S.D. and subject the dad to a miserable commute in order to have a stay at home mom in the house, especially if Temec drops faster and further than S.D. so that the prices are closer to half of comparable homes in S.D.
May 24, 2007 at 12:44 AM #54675ParticipantTo answer former owner, the cash outs are a chunk of who has moved out here. My parents moved here after cashing out and paid cash (albeit they did it in 1999). They were nearing retirement so the commute didn’t affect them, they were close to the grandkids and they got a similar sized house in a similar community with the equity from their previous house. To them, the future price was a moot point. They didn’t want to move out of state and away from all of their grandkids and they got a house on a golf course in Range of the wineries without the 115 heat of many retirement areas like Arizona, Nevada or Palm Springs. They also picked up two rentals with cash that provide income. If prices do fall here first and faster than S.D. (which they will) it will be attractive to cash outs again. Never underestimate the benefit of not having a mortgage. The other reason is the Dr. Laura principle. Many couples with young kids will cash out of S.D. and subject the dad to a miserable commute in order to have a stay at home mom in the house, especially if Temec drops faster and further than S.D. so that the prices are closer to half of comparable homes in S.D.
May 24, 2007 at 1:08 AM #54666Participantunion, the 700k Temecula home is a rarity, usually they have 100k+ pool and ugrades sunk into them and would be well north of a mil in other places, or they have drunk the kool aid and will never sell. New developments are priced about 500k for over 3000sq ft. right now. 600k is high and would have to have 10k sq ft lot, view, etc. Things north of 700k often have land. Here’s a few in the mid 600’s in Redhawk (the most expensive development of the most expensive zip code)but they are still the high end ones. An 900k house in 4-s is 500-600 in Temecula, there are lots of things that make prices higher or lower but comparing apples to apples it is still at least 1/3 less. What makes a temec house worth 700k is beacuse that house is 1.2 mil in 4-s
And here is a cheaper 2700 sq ft, redhawk on the course with few upgrades and a small lot for 500k
May 24, 2007 at 1:08 AM #54680Participantunion, the 700k Temecula home is a rarity, usually they have 100k+ pool and ugrades sunk into them and would be well north of a mil in other places, or they have drunk the kool aid and will never sell. New developments are priced about 500k for over 3000sq ft. right now. 600k is high and would have to have 10k sq ft lot, view, etc. Things north of 700k often have land. Here’s a few in the mid 600’s in Redhawk (the most expensive development of the most expensive zip code)but they are still the high end ones. An 900k house in 4-s is 500-600 in Temecula, there are lots of things that make prices higher or lower but comparing apples to apples it is still at least 1/3 less. What makes a temec house worth 700k is beacuse that house is 1.2 mil in 4-s
And here is a cheaper 2700 sq ft, redhawk on the course with few upgrades and a small lot for 500k
May 24, 2007 at 1:13 AM #54662SDHousehunter
ParticipantI have rented for three years knowing that my gross housing expense a (rent) was over 10K cheaper than if I had purchased a like property and had the full tax deduction paying IO, taxes and HOA/MelloRoos.
I lived in Temecula for one year, renting, to see if we enjoyed it. In the complex where we lived, asking prices have dropped 25-30% YOY.
Here are my observations and candid ramblings:
Temecula is a wonderful place to live as far as scenery, however, you have to live and work there for it to be worth it. No use spending 25% of your waking hours driving down the 15 to get to work because there is no industry for 40 miles.
So many people we met are upside down, maxed our financially and are on a one way ticket to bankruptcy. I knew someone who was using his HELOC to pay his mortgage and his interest on his HELOC Loan. . . . . talk about burning equity.
Everybody and his mother seems to have a leased automobile or new car purchased. And every morning Starbucks is full of people in fancy cars, drinking coffee and talking about real estate. My theory is that 80% of the population I can is upside down in their vehicles except those who took out 40K home equity in order to buy that Hummer H2 to show off to the neighbors.
Temecula is the honarary “Bible Belt” and independent free thinking, culture, is limited or non-existent. In a nutshell, Temecula is a land of uneducated bible-thumping white-trash sprinkled among Pechanga Indians (living off the doll) who saw their property values and casino welfare double due to the influx of San Diegans searching for affordable housing.
Given Temecula’s role as ground zero for the San Diego Housing Boom and its mathematically challenged population it was and still is a great area for predatory lending and multi-level marketing scams (Sorry,selling Arbonne is not a career!)
I see values declining for year to come.
Home prices above $500K consist of primarily McMansion speculators or fradulent loan purchasers. E.g., As I drove by one home priced at 750K I noticed the 12 people living, eating and parked in the front yard. I am sure that given the style of clothing (white t-shirts and long black shorts covering arm tattoos) that these individuals were not lawyers, doctors or people with professional degrees who make over 100K in order to purchase expensive homes)
Also, Some neighborhoods change form street to street. The Toyota Highlander or Camry can turn into a 1999 Ford Focus and a Ford F150 packed with a Lawnmower.
I predict complete financial meltdown and 12,000,000 new credit applications to purchase the what remains.
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