Forum Replies Created
-
AuthorPosts
-
flyer
ParticipantAnd in other real estate news–don’t think this will affect any of us. Personally, we haven’t been flipping for awhile, so I’m not concerned–not the core of our business. There are lots of things going on in the world that could have an impact on real estate, but I don’t think this will move the needle much, if at all.
SAN DIEGO COUNTY, Calif. — A state law maker from San Diego says short-term investors are contributing to the housing crisis. Now he’s introduced a Bill he says will give average people a chance to own a home again.
Flipping houses is nothing new. You purchase a property, make necessary changes and then sell it for a profit.
But Assembly member Chris Ward, from the 78th District, says that process is hurting the housing market and keeping average people from buying a home.
The California Housing Speculation Act or Assembly Bill 1771, is designed to change real estate tax policy and discourage some investors from quickly reselling properties like single family homes.
“It would be an additional income tax on the profit gain from a sale that occurred within three years of the previous sale,” said Ward.
Ward is proposing an additional 25% tax on the gain from the sale beginning January 1, 2023.
He says research shows U.S. investors bought a record $63.6 billion worth of homes by late last year. Nearly three-quarters of that was single family homes, the highest level it’s ever been.
“But we’ve also seen this influx of short-term investors trying to get into the market, outbid San Diegans and Californians with all-cash offers, and drive the prices up for everyone,” Ward said.
Ward says California does have a housing supply deficit, but profits continue to grow by 26% each year, which isn’t sustainable.
University of San Diego real estate professor Norm Miller says the Bill may help, but California’s tax laws are still more favorable to investors.
“But if you’re an investor, an institutional buyer, not only do you get unlimited tax right offs from the mortgage interest and the property taxes, you’ll also get depreciation, which is something an owner does not get on their own personal residence,” Miller said.
“So, if somebody’s trying to go in there, fix up a fixer-upper and then sell it for record profits, that is distorting the market because somebody else could have gone in there, done the same and kept the home,” Ward said.
ParticipantI think just about all of us who are in a position to take advantage of a correction, as we have before, would, but I still would not wish or need for that to happen.
There are lots of deep pockets here and around the world, so, if it does happen, it will be ultra competitive among many investors, especially now that San Diego seems to be on the map even more so than in past years.
ParticipantYes, Scaredy, those possibilities make our little real estate issues seem even more insignificant, as those, and we, are in the end, anyway.
Still have hope that things will get better–especially for the people of Ukraine who are having to deal with the realities of this horrible situation every day for no reason other than the ego of a “high-functioning” psychopath–the worst kind–so will check back in on the other thread from time to time to see the opinions.
ParticipantDZ, I know you feel the position you are taking in these discussions is the right one, and you have made some very good points, but, I sincerely don’t believe you’re ever going to convince others, who hold opposing views, to change their position wrt real estate investment, regardless of how things may change in the future.
It’s true that windfall profits have been made in real estate, and with other investments, but none of us could have known that at the outset. We were just making educated guesses, and, recently, unique societal events, have made many things extraordinary investments–for now–and as with all things in life, anything can happen.
In the final analysis, no one really owns anything in this world, we’re just borrowing everything we have while we’re here, and then, possibly passing those things on to others who will just borrow them for the short time they are here. It’s all transitory, so why worry about it?
Even if you chose not to invest in real estate, you can still enjoy your life in San Diego, which is what we should all be doing each and every day.
March 4, 2022 at 9:56 AM in reply to: Ot. Nothing to see here, just a nuclear plant bombed and on fire… #824057ParticipantDefinitely concerning, scaredy. Hope those in power find a way to end this before it spreads like a virus, but we’ll just have to wait and see.
FWIW, in the past week, we’ve been hearing a lot more aviation activity than usual out of Miramar, over RSF and Del Mar so, something may be brewing.
ParticipantGreat–and they’ll all need housing–fantastic!
ParticipantYes, those opportunities are extremely exciting–sons keep me clued in on all investment ops.
With so much growth in San Diego, and so little housing supply, barring extreme effects from black swan events–which seem to be more likely everyday–there’s really no place for real estate to go but up.
Even if there is a correction in real estate from a dramatic change in life as we know it, I think San Diego has a better chance of weathering storms to a greater degree than many locations, so we should all be very glad we’ve taken advantage of these great opportunities before everyone decided to come to the party.
ParticipantAlthough a valid concern, I agree that if the intent of the post is to determine if San Diego and housing in other desirable locations is suddenly going to collapse because of a change in the working status of tech workers, imo, that’s very unlikely to happen, for all of the reasons that have already been mentioned.
There are definitely many issues that could subdue the current frenzy, and/or even cause some type of correction in real estate markets, but, as an investor, if you’re not over leveraged, that’s not a problem. The demand for housing is coming from many sectors of society, not just one, and, imo, that overall demand will continue to far outweigh the supply for many years to come–we shall see.
ParticipantThose are astounding. Same thing in areas we’ve invested in. Properties we purchased for under $200K are now off the charts. Going back even further, parents bought in some prime areas for well under $100K. Definitely has been and still is amazing to watch San Diego become such a coveted destination.
ParticipantAgree. When I think back on when we and extended family etc. were investing on or near the coast years ago, we pretty much knew prices would go up, but I don’t think anyone could have imagined what we’re seeing now. In certain areas, rising sea levels are a concern, but that may take awhile.
ParticipantSince we’re not planning on selling anything at this point in time, it’s always interesting to hear what’s currently going on in the streets–and it’s amazing:) One downside is, it could become a challenge for younger generations who grew up here, and others who would like to buy.
Imo, San Diego and certain other locations will continue to be in high demand for the unparalleled quality of life they offer, so if and when the frenzy ends is still up for debate. Guess we’ll just have to wait and see.
Participant[quote=scaredyclassic][quote=flyer]Glad to hear you’re doing better scaredy. Even though we’re all triple vaxxed, we still feel like we’ve just been lucky to dodge the bullet so far, and hope this surge is almost over, but, who knows if there might be another in our future.
Looking forward to watching what the new year brings in real estate and the stock market. It’s been a great ride for the past several years, so it will definitely be interesting to see what’s next.[/quote]
I have never been this sick in my life. Jeez. It’s mild, I guess, but usually one gets a little sick, you rest, you shake it off. This bug is way more tenacious.[/quote]
I’m sorry to hear that. I’ve heard it’s extremely debilitating. Nice you have a doctor in the house:)
Unfortunately, it looks like we’ll all be living with some incarnation of the beast going forward, so life goes on, and all we can do is what most of us are doing to try to stay safe. Take care.
ParticipantMy parents were involved in real estate before I became involved, so I don’t recall any specifics, but I know they took advantage of some great opportunities over various decades. Still, the last several years have been pretty great for investors, too.
ParticipantHave never seen such a fantastic real estate run-up in my lifetime–but where things go from here is still a mystery, and the Russia situation may become a thing–or not. As always, probably best to be prepared on all fronts for whatever happens.
-
AuthorPosts
