[Coronita]

Save for a down payment. It will put you in a better cash position in case rates go up. It's better to buy a home at a lower price and higher interest rate then a home at a higher price with lower interest rate, even if the monthly payment is the same. If rates go down you can refi, but your purchase price will stay the same. Also only your interest payment is higher, not your principal payment. Your taxes will be lower also. It's also better when you go to sell. You don't want to sell a home that cost you 600K for 500K even if your montly payment is low. Your cost basis is a lot more important than your monthly obligation.

 

You're assuming that rates are actually going to fall in the forseeable future. What if for the next say 10-15 years we have nothing but interest rates go up and up? Take your mortgage and imagine a 15% mortgage on that. BTW: if mortgages are 15%, can you imagine what the APRs on other financing will be like? Don't think 15% is possible, talk to someone that bought a house back in the early 80ies. 

 

I think the misconception some folks have is that they think home prices are going to have a sustained downward trend, but that mortgage rates are going to rise and then stay flat or even fall, when in reality, home prices are going to continue to fall, and mortgage rates are going to continue to creep up. Along with that, the cost of living is going to go up. Health care is going to get more expensive, daily necessities is going to get more expensive. Transportation is going to get more expensive. Meanwhile, wages are going to stay flat or rise at a lower rate…As we globalize, companies will find cheaper and cheaper labor elsewhere. The plight of the middle class isn't too promising moving forward.

[Coronita]

I can't wait to see that happen here. I'll bid 300k for that Pienza home in 4S Ranch please. Can you imagine the hostility in that neighborhood for years to come. The new buyers(lucky) vs old buyers(screwed). That one "Dude" looks like he'll be part of the welcome wagon for the new buyers.

 

Uh recordkeeper, it's definitely going to be a Kodak moment when homes like this are $300k,  but interest on the mortgage will be like 15-20% with tighter lending rules, higher inflation, and stagnant wages. Can you imagine the hostility in that neighborhood for years to come? 

…Some of old buyers(screwed). 

…Most of the new buyers (still screwed on affordability/attainability).

…A few of the sideliners tha can buy a $300k-400k home in cash(lucky).

 

Relaxed financing and low interest was a blessing for those that could have managed their finances. If you think things are bad for the average folks now, wait until mortgage rates get insane, inflation rises, while salaries stay stagnant.You think average salaries are going to rise at the same rate as inflation to keep pace, or that interest rates are going to stay below 6.25%? You might be in for a rude awakening yourself.

 

if you're doing what most people are doing which is keeping your funds in a CD/government bond/and or money market. It's like 5.5%-6% right now tops. Is this keeping up with inflation? Nope. You willing to take the plunge into stock market and risk a downturn to try to beat inflation?

I'm not wishing a demise for the house industry. Because either way, most average joe's will get screwed too..If you're not going to be able to do a near cash-and-carry, affordability/availability is still going to be an issue.

 

[Coronita]

I can't wait to see that happen here. I'll bid 300k for that Pienza home in 4S Ranch please. Can you imagine the hostility in that neighborhood for years to come. The new buyers(lucky) vs old buyers(screwed). That one "Dude" looks like he'll be part of the welcome wagon for the new buyers.

 

Uh recordkeeper, it's definitely going to be a Kodak moment when homes like this are $300k,  but interest on the mortgage will be like 15-20% with tighter lending rules, higher inflation, and stagnant wages. Can you imagine the hostility in that neighborhood for years to come? 

…Some of old buyers(screwed). 

…Most of the new buyers (still screwed on affordability/attainability).

…A few of the sideliners tha can buy a $300k-400k home in cash(lucky).

 

Relaxed financing and low interest was a blessing for those that could have managed their finances. If you think things are bad for the average folks now, wait until mortgage rates get insane, inflation rises, while salaries stay stagnant.You think average salaries are going to rise at the same rate as inflation to keep pace, or that interest rates are going to stay below 6.25%? You might be in for a rude awakening yourself.

 

if you're doing what most people are doing which is keeping your funds in a CD/government bond/and or money market. It's like 5.5%-6% right now tops. Is this keeping up with inflation? Nope. You willing to take the plunge into stock market and risk a downturn to try to beat inflation?

I'm not wishing a demise for the house industry. Because either way, most average joe's will get screwed too..If you're not going to be able to do a near cash-and-carry, affordability/availability is still going to be an issue.

 

[Coronita]

I nominate Rich Toscano to run for office. We’ll make sure he has “sufficient” campaign financing.

[Coronita]

I nominate Rich Toscano to run for office. We’ll make sure he has “sufficient” campaign financing.

[Coronita]

Um…Not trying to burst your bubble here but….

In case you missed it, Wall Street recent handed out very very very very very very very large bonuses recently to all the bankers recently.

If you need to wait for any type of correction to be able to afford something in here in San Diego, you’re going to be waiting a hell of a long time to be able to afford something decent in Manhattan.

[Coronita]

Um…Not trying to burst your bubble here but….

In case you missed it, Wall Street recent handed out very very very very very very very large bonuses recently to all the bankers recently.

If you need to wait for any type of correction to be able to afford something in here in San Diego, you’re going to be waiting a hell of a long time to be able to afford something decent in Manhattan.

[Coronita]

Two income in early 30ies, 1 kid. One ivy undergraduate(me), one with a masters. Both in software roughly compensated the same.
We’re slightly above gross household income multiplied by an odd digit. Income from investment provides an additional even multiple of the household income.

[Coronita]

Two income in early 30ies, 1 kid. One ivy undergraduate(me), one with a masters. Both in software roughly compensated the same.
We’re slightly above gross household income multiplied by an odd digit. Income from investment provides an additional even multiple of the household income.

[Coronita]

It’s a nice home. The only thing would bug me about Rancho Santa Fe is it’s to my understanding, mail isn’t delivered to some of the homes…. you have to go pick it up at a postal office. At least that’s the case with one of my friends.

But, like I can afford to live there to be commenting anything negative about RSF

[Coronita]

It’s a nice home. The only thing would bug me about Rancho Santa Fe is it’s to my understanding, mail isn’t delivered to some of the homes…. you have to go pick it up at a postal office. At least that’s the case with one of my friends.

But, like I can afford to live there to be commenting anything negative about RSF

[Coronita]

I don't know why you guys think there is so much money on the sidelines. The reality is, by this point nearly everyone who really wanted to buy a house already has. That is why the home owership rate is at an all time high! With the recent lax lending anyone with a heartbeat could buy a house. Who is left on the sidelines? First time homebuyers of course but they are effectively priced out of the market until home prices fall dramatically. The only other group would be those of use who cashed out of the market and are waiting for it to crash. We are in no hurry to buy now. The move up buyer market is drying up because they realy on first time homebuyer to purchase their homes. Speculators are finished.. Who else is left on the sidelines???

 

I actually think that home prices are going to decline for >7+ years. Because as the largest group (baby boomers) head into retirement, they're going to be selling homes to cover all their expenses. It seems like it's going to be a long way down.

That said, if I find a deal on a bigger/better home, I'd probably buy Sorry. I know there is a backlash against mcmansions..But I'll admit. I'm somwhat materialistic…. I do like bigger homes. But I'm just not going to kill my finances over one. 2550 sqft is fine with me right We need a mortgage, because the income taxes are killing us. And will get worse moving forward. Currently with our mortgage and other deductibles, our fed tax rate is about 14%. Without it, our tax rate i think would be closer to 25%. Unfortunately we don't have a side business that gives us additional shelters.

I'm really concerned that my wife and I are going to end up paying higher taxes in our retirement years than now. We are at the lowest tax rates ever. But what our country has to look forward is a broken medicare system, broken social security system, huge national debt, etc…..Someone is going to have to cough up this money..That someone will be us taxpayers. We're going to be paying taxes up the nose in the future. A lot of folks are concerned about inflation. I think the really threat will be both higher inflation and higher taxes . the one-two punch will kill our purchasing abilities.

 

 

 

 

[Coronita]

I don't know why you guys think there is so much money on the sidelines. The reality is, by this point nearly everyone who really wanted to buy a house already has. That is why the home owership rate is at an all time high! With the recent lax lending anyone with a heartbeat could buy a house. Who is left on the sidelines? First time homebuyers of course but they are effectively priced out of the market until home prices fall dramatically. The only other group would be those of use who cashed out of the market and are waiting for it to crash. We are in no hurry to buy now. The move up buyer market is drying up because they realy on first time homebuyer to purchase their homes. Speculators are finished.. Who else is left on the sidelines???

 

I actually think that home prices are going to decline for >7+ years. Because as the largest group (baby boomers) head into retirement, they're going to be selling homes to cover all their expenses. It seems like it's going to be a long way down.

That said, if I find a deal on a bigger/better home, I'd probably buy Sorry. I know there is a backlash against mcmansions..But I'll admit. I'm somwhat materialistic…. I do like bigger homes. But I'm just not going to kill my finances over one. 2550 sqft is fine with me right We need a mortgage, because the income taxes are killing us. And will get worse moving forward. Currently with our mortgage and other deductibles, our fed tax rate is about 14%. Without it, our tax rate i think would be closer to 25%. Unfortunately we don't have a side business that gives us additional shelters.

I'm really concerned that my wife and I are going to end up paying higher taxes in our retirement years than now. We are at the lowest tax rates ever. But what our country has to look forward is a broken medicare system, broken social security system, huge national debt, etc…..Someone is going to have to cough up this money..That someone will be us taxpayers. We're going to be paying taxes up the nose in the future. A lot of folks are concerned about inflation. I think the really threat will be both higher inflation and higher taxes . the one-two punch will kill our purchasing abilities.

 

 

 

 

[Coronita]

I think many, many young couples with good incomes and some savings are opting out of CA at this point. I just met a girl (well, I guess we are women at almost 40yrs old now) the other day at my kids' little school (public). She is a lung doctor and also raised in beautiful San Diego. Husband also has a fantastic job. No shortage of income or cash, but they felt they were priced out of CA – and left. As cyphire says – the prices for small 3 bedrooms in places like DelMar, where people like this would want to live, are not realistic. It is not a matter of not being able to afford 1.5m for some people … it is the fact that WHAT YOU GET FOR 1.5M IS NOT WORTH IT. So I am of the camp that there are very few 1st time buyers out there with any hope of buying in at even $400k, and of the few that do have cash, they will find what is available at that price unappealing.

 

Folks that think it's bad here, try living in the Bay Area. Here you get to pay a lot for something that at least looks decent. There, you pay a lot for something that looks like a 19 year old hole in the wall. Of course there is a shortage of land in Bay Area as opposed to here. 

[Coronita]

I think many, many young couples with good incomes and some savings are opting out of CA at this point. I just met a girl (well, I guess we are women at almost 40yrs old now) the other day at my kids' little school (public). She is a lung doctor and also raised in beautiful San Diego. Husband also has a fantastic job. No shortage of income or cash, but they felt they were priced out of CA – and left. As cyphire says – the prices for small 3 bedrooms in places like DelMar, where people like this would want to live, are not realistic. It is not a matter of not being able to afford 1.5m for some people … it is the fact that WHAT YOU GET FOR 1.5M IS NOT WORTH IT. So I am of the camp that there are very few 1st time buyers out there with any hope of buying in at even $400k, and of the few that do have cash, they will find what is available at that price unappealing.

 

Folks that think it's bad here, try living in the Bay Area. Here you get to pay a lot for something that at least looks decent. There, you pay a lot for something that looks like a 19 year old hole in the wall. Of course there is a shortage of land in Bay Area as opposed to here. 

[Author]

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