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bewildering
ParticipantDo you live in Irvine?
Do you own your own house?
What other investments do you have?
Participant[quote=harvey] The majority of households that made between $150,000 and $300,000 would see a tax increase.[/quote]
Yep. I do not see any way our household will benefit if property taxes and state taxes are removed as deductions. The 150,000 to 300,000 earners already pay more as a proportion of income than any other group. This plan will make it worse.
ParticipantEvery house has some issues.
Your realtor should be advising you. I think this is the point of the buying process when realtors really earn their money. Your realtor should know some contractors. Find out how much the repairs will cost.
The sellers have to work with you. No mortgage company will give you the loan without a termite clearance. And the termite clearance required fixing rotting wood and dry rot. The termite clearance is a separate report from your inspection. They report to the mortgage company.
In my case, the inspection report did not notice some stuff that Termit guy noticed. Contact Michael Keller from Top Notch termite company. Have him take a look. His due diligence saved me 10,000s as the sellers had to fix before we could close.
I do warn you, that this process took us months.
Participant[quote=gzz]I think inflation even at 0% is overstated.
For middle class people, new cell phones, PCs, and car payments are major expenses.
[/quote]I disagree. All of the items you mention are choices.
We pay childcare and preschool costs that go up at least 2.5% per year. These costs are not a choice, we have to put our kids somewhere while we work. Also, we will have to pay for extended care when they go to school. And college costs rise every year.
My healthcare costs are going up at least 3% per year. This is through work but still is part of reimbursement.
We own a house (thankfully), but our friends just rented a place for $4100/month. That is substantially higher than a few years ago.
Participant[quote=gzz]OB rcently got three prefab houses. I think the developers were only about 30 and it was their first project. The lot had been vacant for at least a decade. Now only two vacant lots remain in OB west of Ebers, one right next to it and one on Santa Monica.
It actually looks better in person, the pics make it look dated ultramodern.
http://www.threeonabbott.com/%5B/quote%5D
I am surprised the steep step ladder to the sleeping area is to code. These houses will definitely not be appealing to people with kids.
Participant[quote=gzz]
In the 92107 zip that I track closely, the 1.2m+ range was slow 2012-2015 even as the mid to low end of that market was very hot. In mid-2016, the high end joined the rest of the market and you started seeing lots of sales in that range, and average time to sell $1.2m houses go pretty suddenly from ~6 months to 1.5-2 months.
June 30 saw two different $2.5m sales in one day, one a tear-down and new construction, the other one a 1912 7,000 sf mansion that had been on and off the market for years.
As for inflation, I disagree that it is higher than what the government reports. People have a cognitive bias where they remember prices that are going up better than prices going down. A number of private efforts to measure US inflation all come very close to the official US Gov number, which itself is one of several measures that are all pretty close to each other (CPI-U, GDP deflater, etc).[/quote]
You could be right regarding high-end properties. My only evidence is based on looking at Redfin. I live in Bay Ho, and there are not many houses for sale (all under 1million). When I scroll across to La Jolla there seem to be lots and lots of houses for sale (all above 1 million).
I always judge inflation studies with a little suspicion after reading “The 2 income trap”. I guess Warren convinced me that ‘necessities’ have outstripped the published inflation rate: such as utilities, housing, education, healthcare and childcare. Whereas ‘wants’ such as cars, fast food, restaurants, and consumer goods have all been in deflation.
Participant[quote=Escoguy]
Trends which may moderate housing price growth:
1. gradual increase in interest rates, 10 year at 2.386%
2. Chinese funds have cooled off, at least for now and usually the Chinese govt waits a few years to reverse policy
3. less immigration to US (legal and otherwise) under DT
4. rents flat or declining in some major US markets like San Fran, Silicon Valley,
5. High end sales flat in places like New York
6. signs that not every millennial wants to have 3 roommates to live in San Fran to afford the $4K/month rent for a 1BR
7. low inflation helps offset some of problem of low wage growth
8. the endless debate about repeal or replace ACA/Obamacare causes some to put of making long term financial decisions (greater uncertainty)
9. everyone wants to buy a Model 3 now as that’s a more fun way to spend money
10. days like today are too hot to look for housing (seasonal effect is actually quite pronounced in SD)
11. SD has been “discovered” already and everyone who wanted to buy has 🙂Please chime in if you think this thought process is off base.[/quote]
1. Interest rates remain at historic lows. Even 5% is low.
2. I do not think the Chinese were ever a large part of the San Diego market – more OC?
3. Immigration will continue, and I have no doubt that population growth in San Diego will continue, Whether from abroad or from other parts of the USA.
4. Rents in SF are insane and make San Diego rents look cheap. Rent will rise until fewer people look for houses.
5. High-end sales seem to be flat everywhere – I see loads of places for sale in La Jolla. I am never sure who is buying 1.5 million+ houses?
6. When millennials start having kids, that is when they look for SFHs. My feeling is that people are delaying having a family.
7. IMO inflation is not low, we just do not count inflation properly. Wage growth is also high for high-income people, we also do not count wage growth properly, an average is pointless.
8. People buying houses are not worried about healthcare. They are middle-aged and mostly get insurance through a job.
9. People do not want a model 3 when having a family.
10. Dunno about weather effects.
11. 🙂
Bonus point: Trump is putting more money into military, which always helps San Diego.
June 27, 2017 at 6:15 PM in reply to: New construction at record low, nominal prices hit new high #807011Participant[quote=FlyerInHi][quote=The-Shoveler]The only place where I found public transplantation cheaper than driving was in Asia, But that was likely because it was very heavily subsidized.
[/quote]There you go. Is it any surprise that Asia is catching up to us very fast? look at their urban development.
Right now, public transport in USA means suffering because of delays, unreliable schedules and not being able to go where you wish.
China already has a second generation high speed train between Beijing and Shanghai. Those train companies are now sized on the order of Boeing in jobs and potential exports.
[/quote]“The China Railway Corporation, the state-owned operator of the train system, has debts of more than 4trn yuan, equal to about 6% of GDP.”
The equivalent 6% in the USA woud be 1 trillion dollars. The majority of their high speed lines are running at a loss.
Surburbia is popular with families. I do not see that ever changing. You have more freedom with a SFH (and using a car). Living in an apartment means depending on having responsible neighbors or having onerous rules. In Germany, in my apartment, I was not allowed to flush my toilet after 10 pm.
June 27, 2017 at 3:18 PM in reply to: New construction at record low, nominal prices hit new high #807003Participant[quote=FlyerInHi]Because public transport is slow and inneficient and cannot improve until we have density. It’s a chicken and egg issue. But the longer we delay, the more we will fall behind economically relative to other countries. Just wait another 50 years and see what I mean.
In the meantime, enjoy your nimbism and your gardenstyle urbanism.[/quote]
I lived in England. There is plenty of density and public transport is still slow, inefficient and expensive. I have never experienced the ‘good’ public transportation that people talk about. Not in the USA, not in the UK, not in Ireland, not in Australia. What is your example of great public transportation? All I see is people having to use public transportation and suffering.
June 27, 2017 at 12:24 PM in reply to: New construction at record low, nominal prices hit new high #807000Participant[quote=FlyerInHi]
For a big city to have flat sprawl is so ridiculous. We need mega development and public transport to match. shopping malls should be allowed to build highrise towers above the stores.[/quote]No one wants to use public transportation. Take Bay Park. They are proposing building 90-foot apartment/condo complexes near the new trolley stops in South Bay Park/Linda Vista (where Jeromes is located). The majority of people will not use the trolley. They will instead use their cars on Morena Blvd, the 5 and the 8, and add to the congestion.
ParticipantNo, it is not an all-time high.
$525,000 in 2017 dollars = $420,000 in 2005 dollars.
The author of this article would presumably be astounded that houses in La Jolla only cost $30,000 in 1955. Because anyone could afford $30,000.
Participant[quote=gzz]Esco what was the percentage income increase per year? So tenant from 2012 pays $2000 and is replaced by a new one in 2017 who pays $2500 would be 25% over 5 years.[/quote]
4.56%
Participant[quote=gzz]Not sure if it still happens, but some sites used to report refinanced mortgages as sales at the new mortgage amount.[/quote]
Ah, thanks, that make a lot of sense. The house is one of the nicest on the block. Just down the street, a complete tear down was sold for 480K, and then subsequently rebuilt before being sold for 889K. I am keeping an eye on this area for friends.
Participant“Property shall be purchased in its present As-Is condition with architectural plans & approvals.”
That is shocking. 700,000 added value in getting architectural plans & approvals?
If you check the old listing you can see how this property is right on top of 3 other neighbors.
http://skyvillagerealty.com/real-estate/idx/mls-160048914-781_e_solana_circle_solana_beach_ca_92075 -
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