[bearishgurl]

[quote=sdrealtor]The camino serbal is in a tract of similarly priced properties. It is on the higher end of the tract which has 1050 homes in it. It is not gated. The homes in the tract were built between 98 and 2003. If I remember correctly in 2001, homes in this tract went between 400 and 700K depending upon size, builder and upgrades. No home built in this tract is worth less than it originally sold for, not even close.

To answer your question HOA fees there were about 87/month which included pool, gym, tennis, parks, walking trails, country club calibur club house and the top scoring school in the district located a short walk from most homes. MR is $800. If you added in PITI plus HOA fees on a $500K mortgage for the house plus taxes, insurance hoa etc you would still be around equivalent rent for a house like that. You cant live in a CD last time I checked….[/quote]

Acc to nearby listings on SDLookup, HOA fees for this subdivision now show as $103 mo. Not sure what they have been since 2001 so will just make a guesstimate here:

120 mos (10 yrs) HOA dues = $11,000 (avg of $91.67 mo HOA dues investment)

$800 x 10 yrs + $8,000 MR investment

Purchase price $633,000; $133,000 downpayment

50,000 landscaping investment

Closing costs at time of purchase (9/01?) $6,000

Closing costs for 3/04 refinance $6,000

Total cash investment over 10-yr life of ownership (not incl maintenance): $214,000

Selling price (10 yrs later) $1,000,000

“Annualized return” 16.66%

*************************************

Necessary carrying costs for ROI (we’ll call it “rent”):

Taxes = $655 mo (avg of 111 mos – tax basis = .010785)*
Insurance = $111 mo (average of 1/12 of 10 years’ premiums)

Total taxes pd over life of ownership: approx. $72,730.00*
Total ins prems pd over life of ownership: approx $13,320.00

$500,000 mortgage (“jumbo” – FNMA conforming limit was $275K in 2001). Prevailing jumbo fixed mtg rate in Q3 2001 was about 7%.

Monthly P & I (11/1/01 to 3/1/04 – 29 mos) = $3,326.51**

Total monthly P&I for first 29 mos = $96,469.79**

Tax records indicate seller refied in March of ’04 so beginning May of ’04, seller’s new 30-yr fixed rate will be 5.5% (“jumbo” – FNMA conforming limit was $333,700 in 2004). New mtg will be $492,606 (based upon lender demand of $486,606 + $6,000 [addt’l] closing costs wrapped into it).

Monthly P & I (5/1/04 to 9/1/11 – 89 mos) = $2,796.96**

Total PI for months 31 thru 120 = $248,929.44**

$345,399.23= Total PI pd for life of ownership (not incl amt shown on HUD 1’s at closings)

$431,449.23 = Total PITI for life of ownership (we can call this “rent” or “oppty expense”). It breaks down to $3741 month over 118 months.

Maintenance expense is not included and unknown. MID benefit to this seller is unknown.

*MR is subtracted from mo property tax exp and used as a “cash investment.” Assumes seller took the HOEX every year of ownership. Assessment raised 2% annually pursuant to Prop 13. For first 9 mos of ownership, seller is charged a supplemental bill only (portion of prior owner’s bill).

**Mtg terms and closing costs based upon seller qualifying for prime mortgages at time of mtg origination and refinance.

*****************************

What is interesting to me here is that it would have taken a household with an approx. $11,500 mo verified gross income to qualify for this mtg back in 2001 (assuming the buyer had zero consumer debt). This assumes ratios of 30/38 used by lender. And the buyer would have had to have $139K in cash at that time to close escrow ($133K downpayment + $6K closing costs).

sdr stated this property was not representative of the norm in 2001 for 92009 (it was higher-priced). I’m curious what the average selling price was for a SFR in 92009 in the year 2001.

Camino Serbal wasn’t an investment that Joe 6P, me or the avg Pigg was able to make back in 2001, IMHO.

I will note that 2001 was PRIOR to the “millenium boom” era of “loose lending.” I will also note that CD’s don’t have “rent expense” or “oppty expense.” One can live in a studio or 1 BR apt, a relative’s back BR or a mobile home/RV and invest in a jumbo CD (and many seniors do)!

Just laying it all out there for the Piggs to much on . . . pls feel free to comment on or challenge any or all of this.

[bearishgurl]

[quote=SD Realtor]. . . Don’t try to convince buyers your home is a good buy if it is not priced based on market conditions but rather what you need to get out of it.[/quote]

I won’t need to convince anybody of anything. The inventory out there is what it is. If I’m not pleased with the offers that come in at the time of listing it, I’ll just put it into rental service and depreciate it to the ground . . . like YOU do :=]

[bearishgurl]

[quote=sdrealtor]CAR
I just ran comps for my Mom’s old home. Its in what is probably the best/nicest 55+ community in SD County. Fortunately I convinced her to sell about 4 years at close to the peak value. Its down almost 50% since then and at roughly what they paid in the late 80’s.[/quote]

Questions:

WHERE was your mom’s home? Specifics, please.

Was it a manufactured home?

Was it a condo? If so, what were the mo HOA dues?

If a mfr home, did the “owner” own the land that sits beneath it??

And I take it this community was limited to buyers 55 and over??

Thank you for your cooperation.

[bearishgurl]

[quote=CA renter]Unfortunately, many people have been conditioned to think that “owning” a house means they will never have to pay for housing. Many people have been brainwashed by the REIC that you should be able to sell a house for everything you put into it, and then some. That’s just not realistic, and it’s even more unlikely as we move forward with an increasingly fragile job market and (IMHO) weaker economy. I think we’re in for a LONG period of weaker fundamentals and a stagnant or shrinking credit market which will reverse a lot of the trends (esp. rising asset prices) we’ve seen over the past ~50+ years.[/quote]

CAR, in my case, I’m not seeking “free” housing for the length of my ownership. I PAID PITI all those years and PAID down my mtg. That $$ (“equity, lol?”) may very well be gone at the time I decide to sell. I TOOK the MID tax writeoff. My TAXES were HIGHER than my property was worth before I first appealed my assessment in 2008. My interest rate has varied between 2.7% (“teaser” for one mo) and 7.1% (avg of abt 4.7 or 4.8%). It is currently at 4.0%.

You might say my paid-down principal ($50K?) was my “rent $$” for all these years but I didn’t even have the benefits a “tenant” does. As an owner, I had to maintain the premises myself. When my oven broke, I lived with a thermometer in it for over 3 years. When my cooktop broke, I lit the ONE burner that worked for 8 mos. When my D/W broke, I washed dishes by hand for at least 6 mos. When my lawnmower broke, I broke a weedeater on my large BY until I bought a VERY used one from a neighbor for $20. When my heater broke, I lived in a 57-degree house at night for 2 months until I could get a part for it installed. When I had to remove flooring due to accidental damage, I lived on subfloor for 2 yrs. And the list goes on.

I’m not seeking “pity” here. Everything is replaced and “fixed” now. What I’m trying to say is buyers who look at listed resale homes that are properly staged have NO IDEA what the homeowner went thru to get them that way. They very well could have purchased them as a cosmetic or heavy fixer and lived in an RV in the driveway for 2+ yrs. Now that the public can see a former sales price of a property from many years ago on an online listing, they often automatically think that a longtime-owner seller’s asking price is positioned to make a killing for them. Nothing could be further from the truth. Do you think an “equity” seller who spends 2000 hours after work and wknds for 2-3 yrs fixing up a fixer should sell for only enough to retire his (purchase $$) mtg balance (originated more than a decade ago)??

In other words, the property I will sell will NOT be the same property I bought. It will be infinitely better. And it is NOT overbuilt for my area.

I’m only seeking to recover the actual cash investment I have in the property, incl prudent improvements I have/will make plus my remaining mtg balance and closing costs. When I list, if buyers don’t like my price, they can always consider a property down the street or around the corner with a 65-yo wall heater and stuck-closed windows of that era, among other antiquated features (that are replaced on my property). It’s a free country.

After 15 yrs or so of ownership in SD County, this isn’t too much to ask, IMHO. If my property was located in Detroit, maybe it is.

CAR, do you personally believe that a longtime owner who did not take “cash out” and doesn’t HAVE to sell should take a hit to their OWN cash investment just to unload their property at a less-than-opportune time, such as NOW?

I ask this to you because, as a prospective buyer, you looked for a very long time in your established area of choice before you found an “equity” seller (estate?) willing to make you a deal you could live with. You seemed frustrated at these “recalcitrant sellers” and can’t deny that “equity” sellers feel as I do.

The truth is, owners who have staying power won’t GIVE their properties away just for the h@ll of it because they don’t NEED to. That’s the way it has always been in coastal CA counties and this will never change. It really doesn’t matter WHAT interest rates or the job market does. Believe it or not, the RE market actually functioned pretty well when a prime 30-yr fixed rate was 10% (1986-1988).

[bearishgurl]

[quote=sdrealtor]Awesome! I know who the first two on my list are. I think you should put up a list oif the most ignored posters. I wouldnt care if I was on it.[/quote]

If one of those users was me, I’d be ever so obliged if you would begin ignoring me NOW. :=D And thank you in advance of your “diss!”

And I just want to wish you and yours “Happy Holidays in `Gridlocked Nirvana'” before you completely shut me out . . . :=0

[bearishgurl]

[quote=CBad]Definitely do ebay for UGGs and if it’s a woman with small enough feet, go for the equivalent kid size.[/quote]

Thank you, CBad and sdr. Good idea about kid’s sizes, too. I’ll check it out!

[bearishgurl]

[quote=bearishgurl][quote=pri_dk]Leverage[/quote]

A 20% downpayment on a $633K purchase equals $126,600 …[/quote]

This amt should have been available to purchase a CD …

Okay … one would have had to invest the entire $633K in 2001 on a jumbo CD to make more than the $317K to $367K that was made on this property. But with a CD, there is no PITI to pay every month and no MID to deduct ….

It’s all too complicated for me …

pri_dk, why don’t you tackle this??

[bearishgurl]

[quote=Jacarandoso][quote=bearishgurl][quote=pri_dk]Leverage[/quote]

A 20% downpayment on a $633K purchase equals $126,600 …[/quote]
Calculate their ROI on the 126K and they did pretty good.[/quote]

sdr said to add in the $50K in landscaping … and don’t forget the carrying costs … ANY non-deductible HOA dues/MR here??

[bearishgurl]

[quote=pri_dk]Leverage[/quote]

A 20% downpayment on a $633K purchase equals $126,600 …

[bearishgurl]

[quote=pri_dk]Sub 5% return counts as “soared in value”

?[/quote]

pri_dk, I didn’t run your math …

So does this mean a homebuyer considering purchasing on Cmno Serbal in “Nirvana” in 2001 could have instead invested at least $100K in 3 or 5 YR Jumbo CD’s and made more $$ after 6, 9, or 10 years holding them and rolling them over upon maturity (sans maintenance, insurance and property taxes)? Am I correct here??

3Y Average CD Rates by Year
3Y average rate across all years: 5.041

Graph Data

Cal. Year 3Y Term
1993 5.139%
1994 6.026%
1995 7.056%
1996 6.286%
1997 6.453%
1998 6.078%
1999 5.909%
2000 7.339%
2001 5.213% purchase year
2002 4.244%
2003 3.098%
2004 3.429% rollover year
2005 4.517%
2006 5.535%
2007 5.553% rollover year
2008 4.099%

5Y Average CD Rates by Year
5Y average rate across all years: 5.250

Graph Data

Cal. Year 5Y Term
1993 5.553%
1994 6.783%
1995 7.670%
1996 6.674%
1997 6.761%
1998 6.189%
1999 6.360%
2000 7.595%
2001 5.562% (purchase year)
2002 4.989%
2003 3.855%
2004 4.415%
2005 4.957%
2006 5.707% (rollover year)
2007 5.526%
2008 4.432%

http://www.jumbocdinvestments.com/historicalcdrates.htm

[bearishgurl]

[quote=sdrealtor]The ammunitition is that it is a postive number and she claimed I couldnt provide any examples of homes built in the last decade that havent lost value. If she is going to use it, then it would have to be for shooting herself in the head. Case closed.[/quote]

Good L@rd, sdr!! Have you completed your recycling job yet? Are you aware that your “regular dude” is now picking thru your dumpster outside?? After you’re done with that task and send him on his way, why don’t you put on your glasses and go stand behind your tape on the floor positioned in front of your “CALTRANS-enhanced wall-mounted” Thomas Guide….

Okay . . . ready? Now pick up your darts and aim them one by one at every I-5 callbox that you have ever been inordinately delayed at in the middle of gridlocked Nirvana . . . Surely you can identify each and every one of them “up close and personal” by now, what with all the time you’ve had to stare at them all these years …..

I have some questions here in need of an “expert” answer:

The Cmno Serbal property (which sold for $633K in 2001), was that on a tract of similarly-priced properties? If so, was this tract first sold in 2001? Is it a gated community? (sorry, I did not look it up). Was this tract priced the average price of ALL sfr’s during 2001 in that vicinity? If not, what was the average sold price of sfr’s in that particular community in 2001?

Thank you for any assistance in this regard ;=D

[bearishgurl]

[quote=briansd1][quote=bearishgurl] The point I’m trying to make here is that the “choice” properties in the “best hands” are not going to move in the near future if their values are artificially held down by the mistakes and greed of the irresponsible masses. [/quote]

I disagree that any market price is “artificial”. It’s the real price at that time.

There is a price to pay for waiting. First, you’re not getting any younger and the money you could have accessed to enjoy life is locked up, so you have to restrain yourself in other areas.

Look at Japan, 21 years after their peak, the Japanese vigor is gone. Many areas outside the urban cores have not recovered in value. The Nikkei’s peak was 38,000. Now it’s at about 8,700.

You don’t see Japanese tourists traveling the world and enjoying life as much anymore. The Japanese signs have disappeared in favor of Chinese.

I’m not saying that America will suffer the same fate, but we could experience an extended malaise.[/quote]

Like I said, I don’t need to recover my purchase price, just my cash investments, mtg balance at the time and closing costs.

Collecting rental income for a few years would supplement my retirement income. If I did NOT retire my mortgage, potential vacancies would have to be budgeted for. If I did end up retiring my mtg, I wouldn’t have as many worries regarding vacancies but you are correct in that I would not have that amt of cash available.

I could always list it for sale a few years into my “retirement” if the conditions are such that I will receive offers I would accept.

The above are choices for ANY “equity” homeowner with a mtg who is nearing retirement-age.

If the US economy experiences an “extended malaise” in the near future but yet these lenders “get with the program” this coming year and take back all “their” properties, then there would be other reason(s) for the “extended malaise,” no?

What caused the Japanese stock market to crash “21 yrs ago,” brian? I wasn’t paying attention to this stuff in the early ’90’s.

[bearishgurl]

[quote=Eve][quote=bearishgurl]
Eve, just for fun, why don’t you suggest to your spouse he go out to Ramona to be there at say, 6:30 a.m. before work, grab some coffee and drive into Poway via the SR-67 at the normal time he would leave for work.[/quote]
We drove around Ramona and he tried that. I don’t think we are Ramona people Thanks for the suggestion.[/quote]

You’re welcome! I’m sure you noticed that there were many large single-story homes out there on fairly large lots!

Try to get into an open house in Palisades (Poway). You will at least get a feel for the construction and nice-sized lots. There are few floor plans in that subdivision but they are ALL one-story homes. This area is well-established and also surrounded now and is not likely to change much in the future.

[bearishgurl]

[quote=sdrealtor]Cant beleive I missed this crazy thought. Who cares what kind of windows you put in and how much you paid. Have you forgotten your RE mantra….location, location, location. Thats what determines value. Put those windows and gold plate them on a house in Detroit and tell me you should get that money back.[/quote]

Have you actually read my posts???

[quote=]…Owners don’t expect to recoup all their home-improvement monies. They expect improvements to help them sell faster and expect to recoup a portion of “prudent” improvements (that is, improvements made that are appropriate for the area’s values)…[/quote]

[quote=]…One could posture from this opinion that ALL properties first sold PRIOR to the “FB era” and were not intentionally overmortgaged by their longtime owners should sell for enough to recover the money their owners put in them, given their improvements were “appropriate” for their areas…[/quote]

In the case of “Andersen wood windows,” the words “appropriate” and “prudent” means the property is located in MH …. or PL, for example. For the record, I have (top-quality) vinyl windows.

sdr, why don’t you do us all a favor and go and recycle all those empty “two-buck chuck” bottles lying around your office and switch to black coffee today, ‘kay? Just look outside your door … That “regular” dude with his shopping cart is standing outside waiting to collect …

[bearishgurl]

[quote=briansd1]…Since you’re worried about your own property value, you should be grateful.[/quote]

Well, brian, it’s not quite time for me to “worry” yet. The fat lady still has to give her encores. I’m finding myself NOT grateful because this “failed debacle” has been going on for far too long. A crash in ’07/08 with subsequent mass REO’s being marketed would have taken care of 90% of this problem in short order. At that time, all the bottom-fishing REITs and other private investors would have swarmed in and bought up multiple SFR and condo properties in the same area and would have been able to house many of these “former squatters” so they didn’t even have to leave their neighborhood of choice! Instead, it is nearly 4 yrs later and here we are! Still fvcking around with all these properties titled in the wrong hands. It doesn’t bode well for anyone’s property values who either owns property nearby huge swaths of these “distressed” areas or the properties in these heavily distressed areas are in direct competition for buyers with their more stable, established area.

[Author]

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