[henrysd]

[quote=toddt]What does everyone think about the Van Daele homes in The Lakes? They are obviously not on the same level as the Lennar homes location-wise but the floor plans seem well designed.[/quote]
Van Daele homes in the Lakes are almost sold out. I went their sales office a week ago, they told me they are selling fast at the pace of 3-5 homes per week. There are only 2 home lots still available and they are listed on MLS now. Even the 3 model homes are already sold. You don’t have much choice there.

[henrysd]

In southern Riverside county a few years ago, it was about 40 days in a semi optimal scenario – tenant answered court paper to Unlawful Detainee law suit, but didn’t show up in court hearing. It could be 25 days in most optimal case if tenant doesn’t answer court papers. For sophisticated tenant and they go to the court hearing and they can find excuses like medical issues, judge can give them a few extra months to stay. They may do multiple hearing and each hearing grants a few months of extra stay.

I don’t remember number exactly. I think roughly at those numbers:

3 days notice

2-3 days file unlawful detainee and delivered tenant copy

7-10 days wait tenant answer for court papers.
If tenant answer received, schedule court hearing which will happen 15 days later

if no tenant showing in court hearing, judge awards the landlord victory immediately. The process can get very long if sophisticated tenant shows up and he will use all kinds of excuses he learned from tenant lawyer.

Another 7-10 days for sheriff to execute lockout.

I believe San Diego county has similar numbers.

[henrysd]

EconProf and urbanrealtor both served HOA board before. In my friend’s case, the home owner cooperated with HOA and asked several times the tenant to correct the issue. Nothing owner did wrong. If the owner tries to fight the HOA in court how do you think of the chances are. There are also 2 other ways of resolving dispute – internal meeting with a HOA assigned board member and third part arbitration. Of course the method with lowest cost is internal meeting.

It seems this HOA has too big power on how they can charge penalty. One HOA of my home has very well documented procedure and descriptions on how much and how they charge penalty. For example first notice warning, 2nd notice warning, 3rd notice $100 fine, 4th notice $200 fine. They delivered those documents yearly to all home owners. I don’t think my friend’s condo HOA has a written penalty procedure transparent to all home owners.

Most leases, especially those popular California Realtor Association lease form, indeed have language saying tenant is responsible to pay HOA penalty.

[henrysd]

Thanks for all replied.

I feel the best idea to me now is just put a low cost value on the form and put comment section that all the work is on landscaping, not the house structure itself. This translates to no or little increase in assessed value which means low annual property tax increase.

When I sell the house 25 years later I have to include my full cost of landscaping in cost basis and that part is governed by IRS. I have the receipt for the contractor and pictures showing the before and after work. They should be good to IRS side. So the cost basis for income tax purpose when I sells the house in future reflects the landscaping amount.

[henrysd]

I agree with the professor. Bond is designed to investors who really understand it. If you are still reading Bond 101, stay away from it at this low interest environment.

There are too many variables involved in bonds and you need understand at least the following before start bond investing:
1) Price/Yield relationship and the ability to calculate YTD from cash flows.
2) Many risks assocated to bond. General interest risk, sector risk, credit risk, default risk, call risk, risk of losing tax exempt status due to legistation.
3) Understand duration of bond.
4) Understand bond convexity.
5) Understand how different types of bond work – Government bond, muni bond, zero-coupon bond, mortgage bond, corporate bond, junk bond, inflation protected bonds.
6) Understand tax consequence of bond. For muni bond there may be portion of income subject to AMT.

I assume you only have a vague idea of price up when yield down, then it is really not good to you.

[henrysd]

All new homes in north 4S ranch have 1.9% property tax. How come this one has only 1.5%? I know 4S new homes have 2 Poway USD school bonds to pay in Mello-Roos.

Another impression is the extremely high fire danger as the small community is like island surrounded by wild brushes. Technically in a 360 degree circle, 320 degrees face wildness.

[henrysd]

I just read a different article saying rent income may be exempt from 3.8% Obama tax if you can prove it is active income. Obama law actually says 3.8% on unearned income normally from passively income including capital gain and dividend.

If you manage the rental homes actively, you are making an active income, so it does not subject to the 3.8% tax for high earners.

My article is from
http://www.billlosey.com/articles/taxing-the-rich-to-pay-for-health-care.php

[henrysd]

If your house has category 5 wiring (normally very new homes), it worth a try of U-Verse; Otherwise avoid it as the fiber optic cables only go to hub near your neighborhood and it is copper connection from your house to the hub.

[henrysd]

I doubt the eviction insurance will help that much. From my Google search, it is small part of the whole package from the property management company itself. It can’t be sold independently.

Most serious and unpredictable costs resulting from eviction is lost rent and property damage which the insurance doesn’t cover at all. The eviction itself is not too much expense relatively speaking. Some eviction services charge as low as $300 plus court filing fee about $260. If you got default judgment without courting hearing, the cost is small. Once go to trial, the cost adds attorney fee which can be another $300. In generally landlord most likely win if tenants fail to pay rent and all the legal steps are done properly.

[henrysd]

I used Bob Waysack from Inspect-It 1st. If you google his name, you’ll get many results on him. All returns will point correctly to him. His phone is 951-696-2097.

[henrysd]

I own rental in Temecula and it was somehow difficult experience to find quality tenants there.

I know one guy who owns 7 homes in Temecula and he went through 2 evictions over last 2 years. One eviction was particularly tough and cost him $20K in lost rent, legal fee and clean-up cost to the property. A few months ago he had another tenant could perform 2 months into lease term and he felt fortunate that the tenant agreed to leave by themselves when they couldn’t pay rent. This owner is a professional real estate developer/investor. He also has a realtor to list and screen tenants.

In Temecula my definition of good quality tenants:
>700 credit score and >$80K annual income.

In San Diego the definition is > 700 credit score and > $100K in annual income or even higher depending on the rental neighborhood. Generally the tenant pool can easily satisfy the requirement in San Diego.

[henrysd]

The biggest problem to Temecula/Murrieta is lack of good quality tenants. House price are dirt cheap there, so those with good credit and stable income have bought their own homes. This leave predominantely junk quality tenants on the market. Investing in Temecula rental house is similar to investing in junk bond – high yield and also high default rate.

[henrysd]

No. Expansion of 1099 to contractor for order above $600 was actually never taken into effect and it was already killed before it took effect due to complaints from small business owners – it created too much booking keeping burden and costs.

[henrysd]

Actually the Mello Roos is much lower than the new homes in Del Sur and 4S ranch. The sales office lists as 1.9% in combined property tax and mello roos, but that is the worst case situation which more applies to those million dollar estate homes with large lot Lennar built earlier. For Belleza home it is more likely 1.7%. In the Lakes community mello roos consists mainly of 2 parts: One is Poway USD CDF and the tax is based on home square footage. Any home with less than 4000 sq ft pays the minimum amount. The other is Rancho Santa Fe CDF which is based on lot size regardless of home size and 15000 sq ft is the cutoff size for least tax. For a typical Belleza home, the combined mello roos is about $4755 for 2011-2012 tax year.

4S rancho new homes have true 1.9% tax with the same price range. Del Sur new homes have tax of 1.9 – 2.05% with $176 monthly HOA and the homes have small lot and very close to each other. A $500K new home in Del Sur has $11K annual tax bill with mello roos counted in.

I attended Lennar grand opening of home release of Lakes in summer 2008. The plan that time was for homes in $900K – 1m. Lennar changed plan after they realized it was difficult to sell at that price range in 2009. They mostly stopped building homes of old style and started new Belleza model in 2011.

Lennar CEO already declared house bottom in the recent earning report conference call. He cited strong increase of demand and orders in west coast region.

Each home in Lakes will have 2 addresses: one is the physical address and another is the mailing address which is a P.O. Box with a Rancho Santa Fe zip code. The mail box is actually inside the community and you no longer have the need of going to post office to get P.O. Box mails. Some people like it: a way to mark up your true location and a prestigious Rancho Santa Fe 92067 zip code. Some people may not like it with 2 addresses.
The parking seems to be an issue as most streets don’t allow parking, so it make hard for friends to come over for large party. There are certain street and areas to allow parking inside the community. The streets are private roads, so some people can accept the no parking rule.

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