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garysears
ParticipantMaybe I am overstating the negative aspects of the neighborhood because I come from a different background with different expectations regarding life in general. In all fairness I can’t really say how bad it is compared to other places in the county.
What I can say is I live near an exit off 67 and am located between 2 7-Elevens and 2 liquor stores, a couple of mobile home parks, and a bar. The neighborhood seems full of interesting characters and groups of young people without much to do. But at any given time you could probably go through here and not notice anything out of the ordinary. I haven’t actually witnessed the vandalism or thefts, etc. in person, just the aftereffects. It could be a relatively few bad apples here.
I walk to one of the liquor stores or 7-Eleven most days and usually run into people that don’t seem highly employed or are prone to mumbling to themselves. That is probably because there are a couple of bus stops in the area. The most popular one is by the DMV and is a common transient hang out.
I don’t have to live here but I choose to live here. I was renting in San Carlos / Lake Murray last year and paying 2X as much to rent a house. I made some significant quality of live choices to get my finances under control and to allow for the future possibility of buying a house. I am actually very well paid, probably more so than is really justified. I make more than the median household S.D. income by myself and I have job security if I want to continue in my career. But I have not always been smart with money and I also had some significant life events that caused bills I couldn’t avoid. So now I’m trying to make up for lost time and am working on a solid financial foundation.
That extra 1K a month in rent was significant to me.
Is East Bradley avenue really that bad? I don’t know.
I can say it is an objective fact that all the realtor signs on the street are vandalised. It is also an fact that there have been several occurances of vehicle vandalism on the street in the 8 months or so I’ve been here. There were still 3 or 4 cars with their tires slashed today in front of the complex. I guess some people do not have the funds immediately to buy new tires. I kind of assume that from the condition of the cars themselves.It is a fact my garage has been broken into here. But my house was broken into twice in San Carlos as well and my garage in Spring Valley before that. I was living at La Mirage off Friar’s Rd and I-8 and they had vandelism / theft issues there in their underground parking. So maybe it is just San Diego in general going down the toilet.
It is mostly the fact that I half expect to get jumped everytime I leave my apartment complex that is the primary difference. That wasn’t the case in any of the previous places I have lived. But I was mostly in the Mission Valley / Mission Gorge area before.
I also note that despite my dislike of some elements there are many families raising children here that will probably get away with it. The kids won’t be killed or molested and might even turn out OK. I do see some very young (3yrs old maybe) and unattented kids running around my apartment after dark and even teenage girls walking down the dark street. For the most part they must be getting away with it. This might actually be normal San Diego for all I know.
I don’t know what should qualify as “ghetto” and I’m sure I’m overly quick to define many things as “ghetto”, but I DO know what qualifies as objectionable. I have to park one of my cars on the street and it is only a matter of time before it is vandalised. I am pretty much resigned to that. Last week one morning there was a used condom on my car windshield.
But again, I am fine living here because I know it is temporary and not required. If I buy a place here it will be less so. For now I have the means to go elsewhere if I decide I can’t stand it.
I appreciated the feedback about my little data project. Up till now I haven’t really added anything to this site but have taken plenty.
I should add that I finally noticed there are 2 sale prices and dates for #139 (thus only 94 condos). I’m not sure how the unit sold for $294K and then four months later for only $205K. The $205K data point should obviously be disregarded as it is an anomally $35K lower than any other sale.
ParticipantMaybe I am overstating the negative aspects of the neighborhood because I come from a different background with different expectations regarding life in general. In all fairness I can’t really say how bad it is compared to other places in the county.
What I can say is I live near an exit off 67 and am located between 2 7-Elevens and 2 liquor stores, a couple of mobile home parks, and a bar. The neighborhood seems full of interesting characters and groups of young people without much to do. But at any given time you could probably go through here and not notice anything out of the ordinary. I haven’t actually witnessed the vandalism or thefts, etc. in person, just the aftereffects. It could be a relatively few bad apples here.
I walk to one of the liquor stores or 7-Eleven most days and usually run into people that don’t seem highly employed or are prone to mumbling to themselves. That is probably because there are a couple of bus stops in the area. The most popular one is by the DMV and is a common transient hang out.
I don’t have to live here but I choose to live here. I was renting in San Carlos / Lake Murray last year and paying 2X as much to rent a house. I made some significant quality of live choices to get my finances under control and to allow for the future possibility of buying a house. I am actually very well paid, probably more so than is really justified. I make more than the median household S.D. income by myself and I have job security if I want to continue in my career. But I have not always been smart with money and I also had some significant life events that caused bills I couldn’t avoid. So now I’m trying to make up for lost time and am working on a solid financial foundation.
That extra 1K a month in rent was significant to me.
Is East Bradley avenue really that bad? I don’t know.
I can say it is an objective fact that all the realtor signs on the street are vandalised. It is also an fact that there have been several occurances of vehicle vandalism on the street in the 8 months or so I’ve been here. There were still 3 or 4 cars with their tires slashed today in front of the complex. I guess some people do not have the funds immediately to buy new tires. I kind of assume that from the condition of the cars themselves.It is a fact my garage has been broken into here. But my house was broken into twice in San Carlos as well and my garage in Spring Valley before that. I was living at La Mirage off Friar’s Rd and I-8 and they had vandelism / theft issues there in their underground parking. So maybe it is just San Diego in general going down the toilet.
It is mostly the fact that I half expect to get jumped everytime I leave my apartment complex that is the primary difference. That wasn’t the case in any of the previous places I have lived. But I was mostly in the Mission Valley / Mission Gorge area before.
I also note that despite my dislike of some elements there are many families raising children here that will probably get away with it. The kids won’t be killed or molested and might even turn out OK. I do see some very young (3yrs old maybe) and unattented kids running around my apartment after dark and even teenage girls walking down the dark street. For the most part they must be getting away with it. This might actually be normal San Diego for all I know.
I don’t know what should qualify as “ghetto” and I’m sure I’m overly quick to define many things as “ghetto”, but I DO know what qualifies as objectionable. I have to park one of my cars on the street and it is only a matter of time before it is vandalised. I am pretty much resigned to that. Last week one morning there was a used condom on my car windshield.
But again, I am fine living here because I know it is temporary and not required. If I buy a place here it will be less so. For now I have the means to go elsewhere if I decide I can’t stand it.
I appreciated the feedback about my little data project. Up till now I haven’t really added anything to this site but have taken plenty.
I should add that I finally noticed there are 2 sale prices and dates for #139 (thus only 94 condos). I’m not sure how the unit sold for $294K and then four months later for only $205K. The $205K data point should obviously be disregarded as it is an anomally $35K lower than any other sale.
ParticipantI think the "reasonable price" is a question you must answer yourself to your own satisfaction. It is probably dangerous to rely on some quasianonymous blogger of dubious merit to be a financial expert for you. I am referring to myself and not SD Realtor. That being said, many people here are extremely smart, experienced, and helpful and provide persuasive data and arguments to consider. You should find out how much a Portico 2100+ sqft home rents for. How much does it cost to own per month and how much could you rent it for? Around the point those 2 values near each other, taking into account various factors, buying as an investment (not counting on speculation or excessive appreciation) starts to make sense and you have found the amount the house should "reasonably" cost. I'm firmly of the belief that real investors (not speculators) are reasonable people. And when they start to buy, values are reasonable because they are actually making real money at a return that makes sense. The current vast difference between the cost to own vs rent is more or less the "bubble". Of course it is an oversimplification but it gets you started looking in the right place. There "should" be a fairly consistent correlation between rents and prices. I don't think you can make an exception for the current market strength. If a particular area is really appealing, it seems logical to me that the rents should be correspondingly higher. So, even though you are talking about homes out of my price range I think the same factors and considerations should generally apply. I would mention that on average the carrying cost to own a mortgage seems to be around 2x the cost to rent everywhere in SoCal. You might ask yourself what are your personal reasons for desiring to buy right now? If there are factors about owning a particular home that you are willing to overpay for, then don't worry about a "reasonable" price. Very few people here will recommend buying at all right now. The very word "reasonable" seems to reflect the idea that prices are currently overinflated even if the market is still seemingly strong. Otherwise the market rate today is reasonable. Like everyone, you wish someone could predict the floor for a specific area or property. Have prices found something of a firm floor in Carmel Valley? If you can't answer that definitely, then you can't say prices aren't going down 30-50%. It sounds like they have alrady dropped at least 10-12%. That isn't that much considering the runup. I don't see it as much of a deal that an 800K home is now 700K. But maybe it is. You should turn the question around and ask if you believe it is possible for prices to appreciate any more? Appreciation is the only thing that can make up the difference between rent value and mortgage carrying costs. If they can't go up and you don't think they'll go down much, you are looking at a sideways market. And it becomes more important in my mind to consider the cost to own vs rent in light of the downside risk to owning. I'm not a real estate guy at all and I would trust SD Realtor to know what the current market is like. However, it sounds like the future market is what you are really concerned about. Maybe it would help to consider the line of reasoning I used for not buying anywhere in San Diego. Granted, I don't know anything about Carmel Valley, but I'm willing to cast a wide net. It got my attention when I began to consider if it is really possible to inflate prices any more. Because someone has to buy these homes. At the time interest rates were the lowest in history, yet the data showed the majority of people the past few years had been taking out interest only or negative amortization loans with minimal downpayment hoping to maximize leverage. This is also the only way they could "afford" the already inflated prices. In order to keep people in the game and also let in more people who should not have made the team, lenders kept lowering standards to virtually nil. As long as "creativity" is required to finance in general it seems ridiculous to even consider buying anything in particular. I also came to believe most people were either buying to make a lot of money quickly (and then sell to the greater fool) or they were scared they would be forever priced out. Both reasons seemed to violate some common sense principles of mine. I actually considered taking an IO loan myself and I know several people who did. The basic theory was "who cares" just pay the interest (and in many cases it was less than market rent) and then sell in 5 years or whenever the rate is going to change and pocket your quick 100K+. But everyone was doing that. I finally began to view the market as a giant game of musical chairs where everyone was selling each other homes and hoping not to be the one looking for a chair when the music stopped. There just didn't seem to me to be much of a concept of the long term future nor the fact that a loan is an obligation. Then I considered that affordability being around 10% in SoCal it was obvious everyone was paying a lot bigger a percentage of their income for a mortgage than used to be considered "safe". Those crazy adjustable loans were taken at a time in history where rates could only reasonably adjust one way. The timing of the loans meant everyone was going to be looking for the exit about the same time when the rates adjusted. The other part I considered is that property "values" are only expectations based on recent sales. It is not as though every home in SoCal has been sold at these ridiculous prices the past few years. A relatively few sales set the future price expectation for all of the ones not on the market. That is true going both ways. Many people don't HAVE to sell because they bought years ago. But those who DO HAVE to sell who bought recently are basically screwed. The final piece was considering liquidity and pondering the result of a change in public perception of real estate as a get rich quick scheme (ie, the music stopping). I'm glad I didn't buy, even if I could have made some money. I couldn't say for sure that I wasn't the greater fool. I decided that if I couldn't spot the greater fool, then I was probably it. I have been educated about real estate mostly from this board. Even if real estate is local you still have factors that need to be addressed: the relationships between the average income, the average interest rate, and the average home price for the area. Those fundamentals are thought to not change much and to become unsustainable at a certain point. There is such a thing as an average household making an average wage buying an average home with an average loan and average interest rate. All arguments against the real estate bubble tend to come down to "it's different here" and state why a particular area has different factors that must make it impossible for prices to fall. It is apparent you make significantly more than the median income if you are considering buying a 700K house. Or you are bringing a lot of equity from another sale and moving up the "property ladder". However, a reduction in prices at the bottom will affect the whole chain. If I look at the forest and don't worry so much about specific trees, it is apparent there hasn't been a forest fire for far too long. It is unseasonably dry and there is a historic fuel load with minimal moisture content. That dry lightning storm you can see in the distance is a combination of rising interest rates affecting widespread exotic loans while loose lending standards suddenly tighten due to the emergence of a new thing called a foreclosure. The minimal equity and personal savings of recent buyers dooms them. You have admitted that it seems clear the prices are going down at Portico. I'm not sure why you say they are not falling 30-50%. I think you can only really say "not yet at least". The best advice anyone can really give an anonymous blogger is to say go ahead and buy the house if you get a price you don't mind actually paying. The concept and expectation of actually paying off home loans seems to have disappeared from the earth. It helped me to realize a home is debt and debt assumes on your future. Anyone who is buying now runs the risk it may not be much of an asset in the near future and it may be hard to sell if you suddenly find you have to. I take it Carmel Valley is a very attractive location. There are probably a million reasons you have already heard as to why the market there is isolated from the rest of SoCal and why it will stay strong. I'm going to go ahead and guess renting there can be done for 1/2 or less than buying. If this fact makes sense to you, then prices are already "reasonable". If it doesn't, it might help to view buying a home as an investment and make some conservative assumptions and ask for a conservative rate of return on your initial investment. You must assume no appreciation for awhile if you really are going to be conservative. There I go again thinking rents should be related to prices! I think local rents should be related to local prices even in Carmel Valley. No matter how snobbishly rich and out of touch and great an area is, it is unlikely there will be no rentals. Market rent rates are set by how much people are willing to pay to live in such a sweet area and not how much land lords wish they could get. So I see that rent really is the current real value placed on all those intangibles that supposedly justify high prices. The market may continue to be different than what I consider reasonable. And other people may get away with buying and selling in the meantime. But as long as the market doesn't make sense to me from a "total cost" standpoint I am going to do the reasonable thing and rent and save and wait.
ParticipantI think the "reasonable price" is a question you must answer yourself to your own satisfaction. It is probably dangerous to rely on some quasianonymous blogger of dubious merit to be a financial expert for you. I am referring to myself and not SD Realtor. That being said, many people here are extremely smart, experienced, and helpful and provide persuasive data and arguments to consider. You should find out how much a Portico 2100+ sqft home rents for. How much does it cost to own per month and how much could you rent it for? Around the point those 2 values near each other, taking into account various factors, buying as an investment (not counting on speculation or excessive appreciation) starts to make sense and you have found the amount the house should "reasonably" cost. I'm firmly of the belief that real investors (not speculators) are reasonable people. And when they start to buy, values are reasonable because they are actually making real money at a return that makes sense. The current vast difference between the cost to own vs rent is more or less the "bubble". Of course it is an oversimplification but it gets you started looking in the right place. There "should" be a fairly consistent correlation between rents and prices. I don't think you can make an exception for the current market strength. If a particular area is really appealing, it seems logical to me that the rents should be correspondingly higher. So, even though you are talking about homes out of my price range I think the same factors and considerations should generally apply. I would mention that on average the carrying cost to own a mortgage seems to be around 2x the cost to rent everywhere in SoCal. You might ask yourself what are your personal reasons for desiring to buy right now? If there are factors about owning a particular home that you are willing to overpay for, then don't worry about a "reasonable" price. Very few people here will recommend buying at all right now. The very word "reasonable" seems to reflect the idea that prices are currently overinflated even if the market is still seemingly strong. Otherwise the market rate today is reasonable. Like everyone, you wish someone could predict the floor for a specific area or property. Have prices found something of a firm floor in Carmel Valley? If you can't answer that definitely, then you can't say prices aren't going down 30-50%. It sounds like they have alrady dropped at least 10-12%. That isn't that much considering the runup. I don't see it as much of a deal that an 800K home is now 700K. But maybe it is. You should turn the question around and ask if you believe it is possible for prices to appreciate any more? Appreciation is the only thing that can make up the difference between rent value and mortgage carrying costs. If they can't go up and you don't think they'll go down much, you are looking at a sideways market. And it becomes more important in my mind to consider the cost to own vs rent in light of the downside risk to owning. I'm not a real estate guy at all and I would trust SD Realtor to know what the current market is like. However, it sounds like the future market is what you are really concerned about. Maybe it would help to consider the line of reasoning I used for not buying anywhere in San Diego. Granted, I don't know anything about Carmel Valley, but I'm willing to cast a wide net. It got my attention when I began to consider if it is really possible to inflate prices any more. Because someone has to buy these homes. At the time interest rates were the lowest in history, yet the data showed the majority of people the past few years had been taking out interest only or negative amortization loans with minimal downpayment hoping to maximize leverage. This is also the only way they could "afford" the already inflated prices. In order to keep people in the game and also let in more people who should not have made the team, lenders kept lowering standards to virtually nil. As long as "creativity" is required to finance in general it seems ridiculous to even consider buying anything in particular. I also came to believe most people were either buying to make a lot of money quickly (and then sell to the greater fool) or they were scared they would be forever priced out. Both reasons seemed to violate some common sense principles of mine. I actually considered taking an IO loan myself and I know several people who did. The basic theory was "who cares" just pay the interest (and in many cases it was less than market rent) and then sell in 5 years or whenever the rate is going to change and pocket your quick 100K+. But everyone was doing that. I finally began to view the market as a giant game of musical chairs where everyone was selling each other homes and hoping not to be the one looking for a chair when the music stopped. There just didn't seem to me to be much of a concept of the long term future nor the fact that a loan is an obligation. Then I considered that affordability being around 10% in SoCal it was obvious everyone was paying a lot bigger a percentage of their income for a mortgage than used to be considered "safe". Those crazy adjustable loans were taken at a time in history where rates could only reasonably adjust one way. The timing of the loans meant everyone was going to be looking for the exit about the same time when the rates adjusted. The other part I considered is that property "values" are only expectations based on recent sales. It is not as though every home in SoCal has been sold at these ridiculous prices the past few years. A relatively few sales set the future price expectation for all of the ones not on the market. That is true going both ways. Many people don't HAVE to sell because they bought years ago. But those who DO HAVE to sell who bought recently are basically screwed. The final piece was considering liquidity and pondering the result of a change in public perception of real estate as a get rich quick scheme (ie, the music stopping). I'm glad I didn't buy, even if I could have made some money. I couldn't say for sure that I wasn't the greater fool. I decided that if I couldn't spot the greater fool, then I was probably it. I have been educated about real estate mostly from this board. Even if real estate is local you still have factors that need to be addressed: the relationships between the average income, the average interest rate, and the average home price for the area. Those fundamentals are thought to not change much and to become unsustainable at a certain point. There is such a thing as an average household making an average wage buying an average home with an average loan and average interest rate. All arguments against the real estate bubble tend to come down to "it's different here" and state why a particular area has different factors that must make it impossible for prices to fall. It is apparent you make significantly more than the median income if you are considering buying a 700K house. Or you are bringing a lot of equity from another sale and moving up the "property ladder". However, a reduction in prices at the bottom will affect the whole chain. If I look at the forest and don't worry so much about specific trees, it is apparent there hasn't been a forest fire for far too long. It is unseasonably dry and there is a historic fuel load with minimal moisture content. That dry lightning storm you can see in the distance is a combination of rising interest rates affecting widespread exotic loans while loose lending standards suddenly tighten due to the emergence of a new thing called a foreclosure. The minimal equity and personal savings of recent buyers dooms them. You have admitted that it seems clear the prices are going down at Portico. I'm not sure why you say they are not falling 30-50%. I think you can only really say "not yet at least". The best advice anyone can really give an anonymous blogger is to say go ahead and buy the house if you get a price you don't mind actually paying. The concept and expectation of actually paying off home loans seems to have disappeared from the earth. It helped me to realize a home is debt and debt assumes on your future. Anyone who is buying now runs the risk it may not be much of an asset in the near future and it may be hard to sell if you suddenly find you have to. I take it Carmel Valley is a very attractive location. There are probably a million reasons you have already heard as to why the market there is isolated from the rest of SoCal and why it will stay strong. I'm going to go ahead and guess renting there can be done for 1/2 or less than buying. If this fact makes sense to you, then prices are already "reasonable". If it doesn't, it might help to view buying a home as an investment and make some conservative assumptions and ask for a conservative rate of return on your initial investment. You must assume no appreciation for awhile if you really are going to be conservative. There I go again thinking rents should be related to prices! I think local rents should be related to local prices even in Carmel Valley. No matter how snobbishly rich and out of touch and great an area is, it is unlikely there will be no rentals. Market rent rates are set by how much people are willing to pay to live in such a sweet area and not how much land lords wish they could get. So I see that rent really is the current real value placed on all those intangibles that supposedly justify high prices. The market may continue to be different than what I consider reasonable. And other people may get away with buying and selling in the meantime. But as long as the market doesn't make sense to me from a "total cost" standpoint I am going to do the reasonable thing and rent and save and wait.
ParticipantWhat is the best free internet out there that lists historical sales data? Is there a really good pay site that is worth the money?
I found you can now search the last 24 months of sales data on the San Diego County Assessors site. I’m sure most people on this site have a better way of getting relevant info but maybe someone will find this useful:
http://arcc.co.san-diego.ca.us/arcc/services/propsales_search.aspx
The Assessor/Recorder/County Clerk’s Office is providing a sales listing for those who are applying for an appeal of their assessed value with the Clerk of The Board of Supervisors. This listing is being provided as a public service and consists of the most recent 24 months of property transfers. The file is updated by the seventh of each month.
ParticipantWhat is the best free internet out there that lists historical sales data? Is there a really good pay site that is worth the money?
I found you can now search the last 24 months of sales data on the San Diego County Assessors site. I’m sure most people on this site have a better way of getting relevant info but maybe someone will find this useful:
http://arcc.co.san-diego.ca.us/arcc/services/propsales_search.aspx
The Assessor/Recorder/County Clerk’s Office is providing a sales listing for those who are applying for an appeal of their assessed value with the Clerk of The Board of Supervisors. This listing is being provided as a public service and consists of the most recent 24 months of property transfers. The file is updated by the seventh of each month.
ParticipantYeah, I know. I actually agree. I’m not thrilled to even be living in SoCal. But then again I’m already currently renting in El Cajon. (There are other more objectionable places in S.D. county I’m sure). The bottom line to me is really the bottom line. At a certain price it will make more financial sense to buy rather than rent. More and more I am finding myself in the “total cost” camp when it comes to life’s expenses. A house is nothing more than a large expense that has to be paid at some point. I don’t view a house as an investment but I’m not stupid enough to buy if I believe it is going to depreciate.
I moved to El Cajon to stop paying 2k a month in rent in the San Carlos / Lake Murray area. I would rather be renting there but it became hard to justify double the monthly cost. Part of the move here was to get my finances in order in preparation for eventually buying.
Keep in mind people were giving almost 300k for this kind of condo crap in El(Los?) “Cajones” only a year ago. I too think 100K is a lot of money, but at current rental rates it is not. I would buy the apartment I am in now for 100K in a second.
I don’t want to be a slave to a big mortgage. I want to buy a basic place, pay it off quickly, and then go on from there if I desire a better standard of living. I want to secure a greatly reduced monthly cost of living first so I don’t have to presume on my future income. I don’t see any other way than to start with a true starter home. If I can pay it off completely I will gain a lot of financial freedom.
I think financial freedom is actually the American dream and not the “home ownership” championed the last few years by government. It has sounded strange to hear the President call home ownership the American dream and point to the all time record “ownership” levels as proof that life is getting better. Debt is slavery, even if it is called “ownership”. The new home ownership is only a form of renting from the bank where you greatly overpay and sacrifice your financial future for the privelage. That will change.
If I’m willing to rent in El Cajon than I certainly am willing to buy a 2bd/2ba condo for 100K.
ParticipantYeah, I know. I actually agree. I’m not thrilled to even be living in SoCal. But then again I’m already currently renting in El Cajon. (There are other more objectionable places in S.D. county I’m sure). The bottom line to me is really the bottom line. At a certain price it will make more financial sense to buy rather than rent. More and more I am finding myself in the “total cost” camp when it comes to life’s expenses. A house is nothing more than a large expense that has to be paid at some point. I don’t view a house as an investment but I’m not stupid enough to buy if I believe it is going to depreciate.
I moved to El Cajon to stop paying 2k a month in rent in the San Carlos / Lake Murray area. I would rather be renting there but it became hard to justify double the monthly cost. Part of the move here was to get my finances in order in preparation for eventually buying.
Keep in mind people were giving almost 300k for this kind of condo crap in El(Los?) “Cajones” only a year ago. I too think 100K is a lot of money, but at current rental rates it is not. I would buy the apartment I am in now for 100K in a second.
I don’t want to be a slave to a big mortgage. I want to buy a basic place, pay it off quickly, and then go on from there if I desire a better standard of living. I want to secure a greatly reduced monthly cost of living first so I don’t have to presume on my future income. I don’t see any other way than to start with a true starter home. If I can pay it off completely I will gain a lot of financial freedom.
I think financial freedom is actually the American dream and not the “home ownership” championed the last few years by government. It has sounded strange to hear the President call home ownership the American dream and point to the all time record “ownership” levels as proof that life is getting better. Debt is slavery, even if it is called “ownership”. The new home ownership is only a form of renting from the bank where you greatly overpay and sacrifice your financial future for the privelage. That will change.
If I’m willing to rent in El Cajon than I certainly am willing to buy a 2bd/2ba condo for 100K.
ParticipantGood idea temeculaguy. In this case I wonder if it matters whether or not I am prequalified. The only way I hear back on this is if absolutely no one else is showing interest. I have suspected that might be the case, which is why I made my offer. I just wonder how much interest there is for foreclosed bottom end properties. But for future lowball offers I will definitely consider getting prequalified.
ParticipantGood idea temeculaguy. In this case I wonder if it matters whether or not I am prequalified. The only way I hear back on this is if absolutely no one else is showing interest. I have suspected that might be the case, which is why I made my offer. I just wonder how much interest there is for foreclosed bottom end properties. But for future lowball offers I will definitely consider getting prequalified.
ParticipantOut of morbid curiosity I made an “offer” on 765 E. Bradley Ave #41. (MLS #078015909) It is a REO unit that has been on the market for 5 months. The original asking price was 230K and was reduced to 175K at some point. I just wanted to see what kind of reaction I might get (or none at all) if I were to offer what I really want to pay. I am curious to see if I get a reply. If so, I think it means there is absolute desperation setting in on the part of the banks. Because I want a 50% discount on the original asking price.
By the way, regarding the crime and vandalism in this particular part of El Cajon, this morning when I was walking out to my car on the street to go to work I saw that 3 or 4 cars had had their tires slashed overnight. They were parked right on the street in front of the unit where everyone has to park. And there was also at least one attempted car jacking of a resident here who parked on Bradley Ave. Gangs are sometimes just hanging out on the steps of the complex. Hooligans seem to rove pretty freely around here at night.
Anyway, here is the text of my email offer in case it is entertaining. I know it is naive and ridiculous, but I am doing it for my own reasons and an informal test of true market conditions. If they actually make a counter offer and try to split the difference it will give me great hope for a future opportunity somewhere I actually want to live. If they accept my offer, I will be shocked, and ready to move in.
I am not pre-approved. I would have to make an offer based on the condion of getting approval. I was neither planning to buy nor ready to buy in this current market. It is not yet a “buyer’s market” IMO. The downturn is just beginning. I think a few more years into this will be much better for families looking to buy. Then I might get a reasonable price on a loan that is made with an actual expectation of eventual payoff.
I firmly believe rising ARM payments are going to force a lot of the increased number of “homeowners” (70% vs 63% historically) nationwide to default, and especially here in S. California with our ridiculous suicide loans. That is why this unit is for sale and many others like it. This growing crisis is already moving lending standards. Establishing basic standards once again is going to be necessary, is already slowly happening, and will further erode property values to more fundamentally sustainable levels.
Having said that, the MLS listing said 175K and make an offer. I went to the condo and toured it the other day. It was really in bad shape. It is in desperate need of new carpets and paint and all the cabinets and tile and fixtures are in poor condition and just plain ugly. (Pretty much what you’d expect from a deadbeat homeowner I guess). Oh yeah, the toilet wouldn’t flush. I don’t know why, and I didn’t spend too much time looking. I didn’t try all of the lights and fixtures. There is obviously thousands of dollars of work that will be required to make it something I want to live in. I am looking for a home for myself and my family and not a rental unit. I also note that this is not a desireable community to live in from a basic crime standpoint. (I know because I live at 425 E Bradley Ave).
175K is a bottom end price for a bottom end foreclosed unit in the lowest priced part of the county. I know the asking price supposedly takes into account the condition, based on a perceived fair market value of a liveable unit being in the low 200Ks. I don’t believe any unit in the complex will sell for 200K for many years to come.
I note that a 1bd/1ba condo in the same 765 E Bradley complex just sold for 102K (#51). I had a chance to see that unit and it was in much better shape.
I believe the floor of the downturn for 2bd/2ba condos in El Cajon will be set by investors rather than speculators which drove prices out of reach in the first place. Current rents cannot come close to making an investor cash flow positive and there is no longer speculative appreciation to count on.
There is just no sustainable reason for the disconnect between rents and property values.
We are headed dramatically the other way. A bottom end condo in El Cajon in general will likely settle in a few years below 150K, I hope, and I’m not interested in overpaying today. That estimate assumes a liveable, rentable condition unit and that interest rates don’t move much in the meantime.
There is also a bank owned (apparently, because it is not on the MLS) condo in the same building (#45). It is in much better shape and a much more desirable unit location. That is the one my wife and I would prefer. It will be interesting to see what the bank unloads it for, or which bank blinks first with the asking price. I haven’t got a response from the real estate agent so I don’t know what the asking price for #45 is. However, it is by far the more desireable unit.
My offer is 110K for #41 (as is) and I’m not interested in paying closing costs. I have taken into account the increase in rent value of a 2bd over 1bd (which will ultimately set prices again), the recent 102K sale of the 1bd/1ba in the unit, and the money required to make the unit liveable, plus the knowledge of where the El Cajon condo market seems to be quickly headed. My total cost, after renovation, would put it in the price range I am comfortable with. And yes, I know the asking price has already been reduced 55K. I don’t know how long that price reduction has been on the market, but it is still chasing the market down IMO (based on the much better unit and 200K asking price for 465 E. Bradly Ave #2).
If the bank is looking to move the condo off the books I can accomodate for 110K. Otherwise I will keep waiting. I just note that the market isn’t exactly moving and the “spring bounce” didn’t happen here in El Cajon condo land.
I have been watching the condo complex no more than 100 yds up the street from me at 465 and 469 E Bradley Ave. There is a bank owed (I assume based on the 273K sale OCT 31, 2006) foreclosure there for 200K (900sf 2bd/2ba #2) and 2 other units for sale (#11 and #6). The bank owned 200K unit is 50K+ less than the other 2 identical units, yet there has been no action on it for 2 months. It will be interesting to see what price will eventually move it off the books. I anticipate the other 2 will probably end up being foreclosures as well and will have to compete with each other based on the foreclosure sale price of #2 if it ever sells. Anyway, there are no takers on the unit after a 73K decrease in “value” (-27%) in only 8 months. (That unit is bigger and in much better shape than 765 E. Bradley #41 and it is going to sell eventually for a discount on the 200K asking price).
Forced foreclosure sales and auctions will end up setting price expectations, up to the natural floor of price/rent ratios based on the stomach for risk of real investors, IMO.
My offer is significantly less than what the bank is hoping for and I can only assume that if I hear from you again it is because the situation banks are in trying to move REOs off the books is more severe right now than the average person realizes.
Regards,
Gary Sears
ParticipantOut of morbid curiosity I made an “offer” on 765 E. Bradley Ave #41. (MLS #078015909) It is a REO unit that has been on the market for 5 months. The original asking price was 230K and was reduced to 175K at some point. I just wanted to see what kind of reaction I might get (or none at all) if I were to offer what I really want to pay. I am curious to see if I get a reply. If so, I think it means there is absolute desperation setting in on the part of the banks. Because I want a 50% discount on the original asking price.
By the way, regarding the crime and vandalism in this particular part of El Cajon, this morning when I was walking out to my car on the street to go to work I saw that 3 or 4 cars had had their tires slashed overnight. They were parked right on the street in front of the unit where everyone has to park. And there was also at least one attempted car jacking of a resident here who parked on Bradley Ave. Gangs are sometimes just hanging out on the steps of the complex. Hooligans seem to rove pretty freely around here at night.
Anyway, here is the text of my email offer in case it is entertaining. I know it is naive and ridiculous, but I am doing it for my own reasons and an informal test of true market conditions. If they actually make a counter offer and try to split the difference it will give me great hope for a future opportunity somewhere I actually want to live. If they accept my offer, I will be shocked, and ready to move in.
I am not pre-approved. I would have to make an offer based on the condion of getting approval. I was neither planning to buy nor ready to buy in this current market. It is not yet a “buyer’s market” IMO. The downturn is just beginning. I think a few more years into this will be much better for families looking to buy. Then I might get a reasonable price on a loan that is made with an actual expectation of eventual payoff.
I firmly believe rising ARM payments are going to force a lot of the increased number of “homeowners” (70% vs 63% historically) nationwide to default, and especially here in S. California with our ridiculous suicide loans. That is why this unit is for sale and many others like it. This growing crisis is already moving lending standards. Establishing basic standards once again is going to be necessary, is already slowly happening, and will further erode property values to more fundamentally sustainable levels.
Having said that, the MLS listing said 175K and make an offer. I went to the condo and toured it the other day. It was really in bad shape. It is in desperate need of new carpets and paint and all the cabinets and tile and fixtures are in poor condition and just plain ugly. (Pretty much what you’d expect from a deadbeat homeowner I guess). Oh yeah, the toilet wouldn’t flush. I don’t know why, and I didn’t spend too much time looking. I didn’t try all of the lights and fixtures. There is obviously thousands of dollars of work that will be required to make it something I want to live in. I am looking for a home for myself and my family and not a rental unit. I also note that this is not a desireable community to live in from a basic crime standpoint. (I know because I live at 425 E Bradley Ave).
175K is a bottom end price for a bottom end foreclosed unit in the lowest priced part of the county. I know the asking price supposedly takes into account the condition, based on a perceived fair market value of a liveable unit being in the low 200Ks. I don’t believe any unit in the complex will sell for 200K for many years to come.
I note that a 1bd/1ba condo in the same 765 E Bradley complex just sold for 102K (#51). I had a chance to see that unit and it was in much better shape.
I believe the floor of the downturn for 2bd/2ba condos in El Cajon will be set by investors rather than speculators which drove prices out of reach in the first place. Current rents cannot come close to making an investor cash flow positive and there is no longer speculative appreciation to count on.
There is just no sustainable reason for the disconnect between rents and property values.
We are headed dramatically the other way. A bottom end condo in El Cajon in general will likely settle in a few years below 150K, I hope, and I’m not interested in overpaying today. That estimate assumes a liveable, rentable condition unit and that interest rates don’t move much in the meantime.
There is also a bank owned (apparently, because it is not on the MLS) condo in the same building (#45). It is in much better shape and a much more desirable unit location. That is the one my wife and I would prefer. It will be interesting to see what the bank unloads it for, or which bank blinks first with the asking price. I haven’t got a response from the real estate agent so I don’t know what the asking price for #45 is. However, it is by far the more desireable unit.
My offer is 110K for #41 (as is) and I’m not interested in paying closing costs. I have taken into account the increase in rent value of a 2bd over 1bd (which will ultimately set prices again), the recent 102K sale of the 1bd/1ba in the unit, and the money required to make the unit liveable, plus the knowledge of where the El Cajon condo market seems to be quickly headed. My total cost, after renovation, would put it in the price range I am comfortable with. And yes, I know the asking price has already been reduced 55K. I don’t know how long that price reduction has been on the market, but it is still chasing the market down IMO (based on the much better unit and 200K asking price for 465 E. Bradly Ave #2).
If the bank is looking to move the condo off the books I can accomodate for 110K. Otherwise I will keep waiting. I just note that the market isn’t exactly moving and the “spring bounce” didn’t happen here in El Cajon condo land.
I have been watching the condo complex no more than 100 yds up the street from me at 465 and 469 E Bradley Ave. There is a bank owed (I assume based on the 273K sale OCT 31, 2006) foreclosure there for 200K (900sf 2bd/2ba #2) and 2 other units for sale (#11 and #6). The bank owned 200K unit is 50K+ less than the other 2 identical units, yet there has been no action on it for 2 months. It will be interesting to see what price will eventually move it off the books. I anticipate the other 2 will probably end up being foreclosures as well and will have to compete with each other based on the foreclosure sale price of #2 if it ever sells. Anyway, there are no takers on the unit after a 73K decrease in “value” (-27%) in only 8 months. (That unit is bigger and in much better shape than 765 E. Bradley #41 and it is going to sell eventually for a discount on the 200K asking price).
Forced foreclosure sales and auctions will end up setting price expectations, up to the natural floor of price/rent ratios based on the stomach for risk of real investors, IMO.
My offer is significantly less than what the bank is hoping for and I can only assume that if I hear from you again it is because the situation banks are in trying to move REOs off the books is more severe right now than the average person realizes.
Regards,
Gary Sears
ParticipantThanks for the comments guys. Whenever I do buy I won’t be interested at all unless my total payment, including HOA and insurance and taxes is covered by the market monthly rent. I am not entirely ready to jump on a 30 year commitment without an out and I’m not willing to presume on my future ability to pay S.D. rents long term. I have no interest in not having my head firmly above water. The only question is how much of a down payment will be required to make the numbers work for me. At least I think I have some time to save now. For me this current downturn trend is a relief and I’m not in a hurry for it to end just yet.
ParticipantThanks for the comments guys. Whenever I do buy I won’t be interested at all unless my total payment, including HOA and insurance and taxes is covered by the market monthly rent. I am not entirely ready to jump on a 30 year commitment without an out and I’m not willing to presume on my future ability to pay S.D. rents long term. I have no interest in not having my head firmly above water. The only question is how much of a down payment will be required to make the numbers work for me. At least I think I have some time to save now. For me this current downturn trend is a relief and I’m not in a hurry for it to end just yet.
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