[joec]

[quote=SK in CV][quote=joec]
We all know rents have been going up 5-10% the past few years… [/quote]

No, they haven’t.[/quote]

You’re saying rents aren’t up 5-10% since 2008/09? I am not saying it is up 5-10% EVERY year, but definitely up that much the past few years to make the rent/own equation not that obvious for most folks and why people are rushing in since their rents are going up, mortgage rates are lower, etc…

[joec]

[quote=SD Realtor]Wrong about investors on most all of he counts. The frenzied behavior we are seeing on SFR homes over 500 is limited in great part to owner occupants, not 100% but pretty close. The investors at this point are sticking to smaller condos or flips. Once more, it is simply a lack of inventory. Why do many of these buyers remain in the frenzy? Many of them believe that prices will continue to move and/or interest rates will rise and that prices will not be adversely affected. Conversely, some of them simply do not want to wait, they waited through 09, 10, 11, 12 and realized they screwed up. I am not saying they should or should not buy now, I am just saying what goes on in many buyers minds.[/quote]

I agree with SDR that supply is really low now. Downside for people trying to time the bottom is that when you buy to live in it, you don’t need it to be the absolute bottom. All those people who skipped buying from 09-12 did miss out and probably do feel like they screwed up so they maybe under more pressure to rush in now (sorta like a person who hit 30 and wants to get married, etc and feel they have to “settle” more).

We can all say you can wait another couple years, but who knows how long the fed will keep keeping rates low. Maybe it’ll be 10 years, 5, 2 who knows. At that time, you’re 10, 5, and 2 years older after missing out from 09 (another 4 years) and not “enjoying” or “wanting” the life you want.

We all know rents have been going up 5-10% the past few years and landlords have all the control now. Renters hate this and feel they have no control paying tons for a crappy place putting more pressure to buy. I know we HATED our rental (area, neighbors, parking, safety, everything).

We bought in 09 and a house down the street rents for more than what my mortgage is now with rates so low. Even if housing goes down, unless rents go down with it, any recent (09-11?) buyer shouldn’t be stressed enough to be forced to cut prices or sell so I don’t think you’d get any recent buyers willing to cut prices much if rents are more. Mortgages were hard too so all these folks put money down so aren’t as likely to default.

[joec]

I think like many people near the top of their game, ER doesn’t mind sharing the information because at the end of the day, it IS a lot of work and he’s pretty clear about that. Most people won’t have the time, desire, finances, and experience to learn from scratch to get there so even with all the info, a lot of people wouldn’t bother to play/compete for the same properties, etc…This is true I think for many fields and areas of work and career.

Glad you’re sharing so much info and like people described by me above, I’m one who doesn’tt have the capital, time, desire to get in the game. Maybe I’ll just buy some REITs instead. 🙂

Thanks for all the info though!

[joec]

I don’t think it’s really that easy to know what’s the best solution. We are in a global currency devaluation situation and the yen has already devalued 20%. Homes, if anything are a great inflation hedge and you already have a lot of people from China just trying to buy up all hard assets in the US like homes in LA, Bay area, San Diego, etc…

Also, if you have to rent in the area or what not, maybe buying is tons better than renting since at the low rates now, i wouldn’t be surprised if you calculated your NON-TAX DEDUCTIBLE mortgage payment maybe already lower than the cost of rent of the same home. I know for a fact that a house i live close to rents for MORE than my mortgage + taxes so you add in tax benefits and the cost to carry it is a joke. Then again, we bought a few years ago so many not at the moment for you, but for sellers recently, this is true.

There was also an article today in the ut saying northrop grumman is moving their drone hq to rancho bernardo I think. That’s not going to help prices and inv in the area…

My point is that you just have to do the math and think a bit more. You might be ok waiting 1-4 years, but what if the wait is 10 years? 20 years? I think most of us would probably agree that it’s a pain to rent and rents have been going up…a lot. House shopping also eats up a ton of time and is stressful. This is a bad time, but no one knows how long it will last. A ton of folks here bought the last few years already when it wasn’t such a sellers market. The thing with house buying is really, you just have to buy once…or only a few times if you move. Once you’re done, it’s not a concern for a while anymore.

It’s never good to rush into anything, but run the numbers and see how it stacks up. Interest rates are also very very low so you aren’t getting much from your hoard of cash savings that you probably shouldn’t invest, etc…which is getting killed from inflation.

I think FLU was saying his mortgage out in CV was closer to 2k/month. You can’t rent any SFH for that price really, not in CV or in Poway probably.

People keep saying watch out for interest rates to go up and everything will collapse, but I sorta don’t think this will happen. You’ll simply have a standstill since anyone who needs to refinance already has mostly done so. People buying now also had to put more than 20% down so they already have equity and can wait it out. Loans have been very hard to get and people who can get them are doing well. Even at 10% unemployment, you have 90% employment. Bay area, Los Angeles, QCOM is killing it driving prices higher…Stocks are also at all time highs making people wealthier.

If worst gets to worst, I think you’ll have more creative solutions where your buyer would just assume your loan through some outside contract or creative financing, etc…I think this was done in the late 70s/early 80s so I don’t buy people claiming utter collapse if rates go up…

With the whole world devaluing their currency, you may be in for a very very long wait as well.

Also, if rates do go up, most people would just keep their places and rent it out since it cash flows out and just not sell. Lack of inventory (like now) equals higher prices again leading to what we have now.

I think sometimes, it’s wishful thinking to see a plunge in prices from people who haven’t bought yet, but really just do the math to see if it actually makes sense. It might not if your rent cost is high and you value your time and are sick of looking.

All these housing bear forums are more quiet now because all the bears have bought recently…Even Rich here.

[joec]

Many thanks for your detailed experience. Yeah, I wasn’t too impressed with the 5 plans offered which mostly looked exactly the same with different deductibles. On the positive, it looks like at least all of them had maternity which was actually really hard to search for last go around. I’ve also noticed a lot of companies don’t even seem to want your business and you’re right, individual plans are extremely expensive. It’s really disappointing compared to what I’ve been used to 20-30 years ago.

We’re probably going to move to an s-corp this year so maybe I will wait for that to happen before changing as it is time consuming.

I tried to get my son off my plan since they seem to want to charge him my rates even though he should be a lot cheaper. They wanted to do a full underwriting again and you have to complete all the paperwork, etc…again…just to split up the plan. It’s like a land grab with these companies. It’s probably not just them and the environment we are in in terms of health care, but it does really suck I think. I had a family member suggest we run all these mental tests when my son was really young and I shut that down because I was worried about what you mentioned as well…They might see something and just deny, raise premiums etc…

Sorta like making random or small insurance claims on a car or home, you really have to be wise with your health insurance too and avoid it if it’s not a huge deal.

[joec]

Here is the link about it, I put in my info and found only a few plans available so not sure if those offered are a good choice.

You can start here:
http://www.costco.com/services.html

A link points to:
https://www51.aetna.com/iqs/costco/aimquote.do

Also business health here as well:
http://www.costco.com/business-health-insurance.html

This was just advertised in their monthly mag last month so was curious how good/bad this is.

[joec]

I’ve used Turbo tax for as long as I can remember. We’re self employed and probably have a pretty complicated tax return I think. Most people would think I’m foolish for doing it on my own, but having worked in finance before and having seen wrong and bad advice given by CPAs when meeting with clients, I suppose I’m a bit skeptical that “any” CPA or EA will do a good job. Any “great or top” CPA/EA will have too many clients if they are good and not enough time to focus on doing a good job on just your return or your business/tax situation I feel.

The main benefit I see with using Turbotax is it just works and you can open any form if you need to. I’ve had to do that on a few occasions mostly for Schedule C stuff, but if you know the tax law a bit, you would know where to look and since it transfers stuff over from one year to the next, you can look at your last years return and make sure you get the same deduction if the program forgot it which it did last year on a few things.

Another thing to consider is you, as a tax payer simply care more about your return than anyone else. The CPA can do your return and has all the knowledge, but even then, I don’t think all CPAs care/love tax so this varies and their goal is just to “mostly” bill and move on to the next guy.

I love learning about and doing my taxes and find it’s fun to save as much as I can so I enjoy doing it myself. It’s nice to see the Turbotax calculator drop what you owe as you enter the numbers. I also spend a ton of time keeping up and reading various tax boards and any relevant tax news so it is a large time commitment to see what has changed from year to year. Turbotax does a decent job of keeping you informed in general.

As others have mentioned, keeping up with your own data that you’d need to give to the CPA is the big pain point and the CPA isn’t going to be helping me entering all the business data so hiring one wouldn’t help me much.

If your return is relatively simple, I don’t see why anyone would need to hire a CPA honestly as most major tax deduction legislation would be hard to miss by Turbotax.

[joec]

Was wondering about this…Would it be “better” / “easier” to get to a top university/school if everyone in your high school isn’t as TOP/Overachieving?

Like I would assume if everyone from the top CV high school applies to say Stanford, they aren’t going to take a ton of people from the same school right?

Course, it doesn’t mean they’ll take someone from the lower high school neither, but I’m assuming the admissions will start getting glassed eyed after reading about the 7th Nguyen student from the same CV school and why they should be admitted…

[joec]

We may go off the fiscal cliff to make it easier to get a deal. It’s reported at many places where once we go off the cliff and taxes are going back to 39.6% federal for income and dividends, massive defense cuts, etc…

It’ll be oh so easy to get a deal for the dems since now, everyone would just be voting on a TAX CUT instead. How can a republican vote AGAINST a tax cut?

In the end, we’d probably need to wait till the exact end of year for a short term compromise or just go off the cliff and then see what parts people want to preserve.

I sorta doubt the mortgage deduction will go away since this would probably cause the housing market to collapse and put the country in further contraction/recession. It’s also such a popular deduction that taking it away would probably be more political suicide.

It’s on the table because it’s a large deduction, but I don’t think it will be majorly changed.

[joec]

[quote=flu]My gardener rocks… If he gets rained out, he comes during the week and does a makeup….Then again, I did refer him to 4 other people….[/quote]

flu, can you pm me your gardener’s contact info assuming he’s still good?

Considering getting some help.

I’m cheap and don’t expect to be paid or pay if they don’t work. You can always make up a session since the rain here isn’t that bad generally.

[joec]

It’s nice to see this discussion here. Is anyone consider doing a solar install themselves? I suppose being technical and generally understanding all the main components, I was considering just doing a solar system for emergency power when we get power outages and maybe to power a few rooms around the house full time with a transfer switch or something. I was mostly just thinking about it so far with a few reads before finding this thread.

Most of the systems you read about on the web/youtube seem to be pretty small of course, but I suppose you could always spend a bit more to do something nicer and bigger. Looking at pricing, those nice 240W panels run $460/per according to the first google search I found and a 4000 Watt Inverter is 2.1k online.

I was planning to back it up with some deep cycle marine batteries so it would work if the grid lost power as well since I was hoping to still have power without the noise of a generator at night.

So anyone else thinking of doing something like that or maybe smaller scale with additional room for growth as needed? I wasn’t planning to stick the panels on my roof initially since I have no idea how to do that.

I was thinking of something like this:
http://www.wholesalesolar.com/backup/refrigeration-backup-power-system.html

Thanks so much for the web link as well. With a 30% tax credit, this would be pretty affordable to power a few things if you were more concerned with power outages.

I looked up our old power bills and we avg about $140/month now so not sure if a full solar system would be worth it financially, but definitely want an emergency solution.

[joec]

I’ve noticed Alamo in my last few car rentals don’t even have that check anymore. Maybe they just check it themselves and don’t treat their customers like crooks? As long as nothing major is broken, they’re ok it seems from my experience.

In my last rental, we cleaned up absolutely NOTHING and was so happy when they gave us practically everything back minus a small cleaning fee. TOTALLY worth it to just not bother cleaning a single thing from my last few rentals.

This is why to be a landlord, one should think like a business person and just “hire” the cleaners, etc since it doesn’t sound like it’s that much for what you get.

[joec]

[quote=OntheSideLine]I wouldn’t mind resale except that there has been not been a resale in the area that I wanted that did not requisite floors to be redone, a different granite in the kitchen, newer appliances, and new paint….About. 40-50k and we didn’t even include cabinets. And the short sales/foreclosures always have shown signs of neglect…people who either didn’t want to take care of their homes or didn’t have the money to maintain…We figured Mission Ranch is about 100k overpriced but we can pick everything we want and slowly do upgrades….planning to take standard flooring and then replace later. We are mainly going to do structural upgrades with builder and do cosmetic upgrades after market. We signed the contract and are content.[/quote]

Congrats on your purchase!

I really don’t think, unlike in 2005-2007, the market will do that poorly. I’m not saying it’ll rocket up, but unlike back then, everyone buying around you now have the income and assets to support their purchases now with underwriting so hard now.

Also agree that new home insulation is tons better. It’s 100 degrees out.

[joec]

[quote=OntheSideLine]This is from the phase 1 release. It is one of the few homes that have neighbor’s on both sides and neighbors behind. It is one of the “smaller” lot at almost 15,000 sq ft. It was also initially priced at 944,000 before the builder added options. It was the lowest price home released. All the more expensive homes with larger lot sizes or no neighbor’s behind have sold. They had the grand opening at the end of August and have sold 10 out of 12 homes…as of early this week…including the highest price lot. The lots with the most privacy or biggest lots were taken first. 10 out of 12 wih an average price of 1 million or so in less than 1 month seems pretty good to me.[/quote]

Yeah, it’s selling fast IMO…I think the last few 4s homes had lots up to 20k as well so this one probably isn’t as great of a deal…How many phases are there?

With stock market at 5 year highs, I think people buying these homes wouldn’t have trouble.

[joec]

Maybe go to the initial phase release and see how crazy it is. If there are 100+ people there buying up all the homes at the listed price, it may be tough to get cheaper. I think some of the recent sold ones on smaller lots/houses went for 800k or so.

Your wife wants new which will make it hard to find new homes without MR now. Carmel Valley has lower tax rate and less MR I think, but prices are quite a bit more and most aren’t 4k in size.

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