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kicksavedave
Participant“Realtor Ron Walraven had a three-bedroom house in the suburb of Bloomfield Hills that had listed for $525,000 sell for just $130,000 at the auction. ”
Ouch… now THAT is a crash… something I’d like to see here in San Diego… not holding my breath though.
ParticipantI sent Dodd an email… don’t know who will read it, but I feel better. I basically told him to “stop interferring with the natural market dynamics and let those people who bought properties that they couldn’t afford, go back to renting.”
ParticipantI’m not a realtor or a laywer, but I do know one thing. When an agent representing a seller tells a prospective buyer about a method for getting a better price out of the seller he/she is representing, there could be a grounds for a conflict of interest, breach of contract, or violation of trust at the minimum.
I called an agent once about the condo across the street from me. It was listed at $500K. He told me, before I asked a single question “They’d probably take $470K for it”.
I thought, if my agent did that I’d fire him on the spot.
I called another agent about a piece of land I was interested in that he was listing. He immediately started telling me exactly why I didn’t want to even look at it, and told me he had all these other plots that I’d be much happier with. Again, does the owner know how good of a sales job his agent is doing?
I can’t give you advice about your friends situation, but that sellers agent sounds like a sleaze ball, and I’d personally avoid trying to make him richer for his sleazy tactics.
ParticipantAnother very real “thing” that could produce huge drops would be a collapse of the sub-prime lending markets, as the pool of qualified buyers would drop substantially.
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Don’t you mean “the pool of un-qualified buyers who bought anyway would drop substantially”???? 🙂
The problem here is that there are a lot of ways for the market to correct back to fundamentally sustainable pricing levels. It could go relatively flat until incomes and inflation rise to meet. It could mush very slowly downward with no easily discernable changes in direction to signal an end. It could drop off a cliff, but that would take a lot of things to all align together. Many of those things will happen, but all simultaneously? Hard to predict.
If you use history, and expect a 7 year decline, that puts us around 2012 for the bottom. How we arrive there, that’s just about impossible to guess.And of course, we could easily see some areas do a little of each, where one areas mushes(Del Mar?), one area goes flat(Scripps Ranch?), one area plummets(San Elijo Hills or Condos downtown?), and yet one area actually climbs(LaJolla?). Add them all up together and you won’t easily be able to tell what’s happening to “San Diego Real Estate Prices” when lumped as a whole. Best to just watch your target neighborhood to see what IT is actually doing, then try to time that area.
ParticipantMy last two landlords asked me things like: “How long have you had this job?” “How long do you plan on staying here?” and “Are you looking to buy a house in the next few years”. I answered them all truthfully, then asked them the following: “How long have you owned this property?” “Do you have any plans to sell it in the next few years?” and “If I like living here are you willing to sign a 2 or 3 year lease?”. Knowing how long they’ve owned it should give you a decent idea on their equity status, albeit not a 100% guarantee.
Any landlord who is afraid to answer questions like that is probably hiding something, and I’d be verywary of signing with them. You don’t need to ask them specific financial questions about their private matters, but issues pertaining to your ability to remain in the house beyond 6 months are totally fair and reasonable.
ParticipantWhere is the legality in a bank signing a contract that says you have 30 years to pay off the loan, then changing their minds after a year and saying you now have 30 days. BS! I would never sign a loan document that had such a clause. Who would? Only someone who doesn’t read the fine print.
There are specific reasons stated in a contract that qualify you as defaulting. The home value dropping a little, I’ve not seen that. Has anyone else actually seen that clause?
ParticipantH82rent…. think about it this way. You borrow $50K from your 401K… buy a nice place which you are happy in… but you sit and watch the property value drop by, oh, lets say, about $50K. How would that make you feel? It would make me go insane, personally. Like saving up $50K over how many years, then simply lighting it on fire. And if the numbers are more like $100K, then ugh, I can’t even imagine. How long did it take you to get that money INTO that 401K? It could be gone in 6 months…
If you wait it out a little longer, you might easily be able to preserve that precious savings/retirement money, and still get the house you want in a neighborhood you like.
ParticipantCan’t speak to being a lawyer in the public sector, but many others have weighed in. However, my Dad worked for the Fed Govt (accountant for HHS) for 20 years and hated it, but retired at 55 and has been happy for 20 years since then with a modest, but stress free retirement. However, my best friends step dad who I am very close with, was a LAWYER for the Fed Govt (VA) and hated it so much it nearly killed him. It was the worst job on the planet, so he said. The beaurocracy, the case loads, the average pay, the inability to get real help to his clients (Veterans). His health actually suffered from the stress. On the day they announced his retirement was up, this 60 year old man literally jumped into the air and clicked his heels.
Also I think your salary comparison between SD and Mizzou is short. Take a look at what you can buy for your money in MO, vs in SD. For $400K in MO you will live in a mansion, in SD a crummy condo. Your salary expectations in either situation are in the high 5 figures. In San Diego, you will be dirt poor. In MO, you will be well off. FOr a nice 4br 3ba house in San Diego, even with your $200K down, your mortgage will be oppressive. In MO, it will be peanuts. With the money you save in MO, you will be able to invest and retire far far earlier than you can in SD.
Check out the savings that accrues from that $1000 a month you won’t spend if you moved.
http://apps.nasd.com/investor_Information/Calculators/nasd/SavingsCalc.aspx
Over 30 years, it’s substantial.
Just my $.02
ParticipantOn the other hand, you could just go to Vegas, put it all on black, and if you hit, pay off your debts and have a nice tidy sum left over. If you don’t hit, well you’ve only lost the bank’s money and you can declare bankruptcy.
—————————————————-True story, last year a buddy of mine took out a $350K HELOC on his nice newport beach home which had about $500K in equity. He put it ALL into one stock, on tips from “friends” that it was about to explode. Unfortunately, they “meant to say” implode, the stock is now about 15% of his buy in price (he did manage to cost basis adjust on his way down the toilet). He finally dumped it after losing most of the 350.
So now he owes roughly $300K at 8 or 9% for a big huge steaming pile of nothing.
He’d have been infintiely better off putting it all on black. Less stress, less time wasted.
Oh, and now that $500K in equity, is down to zero (or negative) because the house has decpreciated a ton since this happened. He even tried to sell and couldn’t get close to his price.
DOH!
ParticipantI’m an engineer, in Sales Support, and the most successful sales people I know have so much free time they don’t know what to do with it all. It’s the not very productive ones who work so hard just to barely make a quota that they have no life beyond work. The good ones, the ones who are truly talented and smart, are found on the golf course on Monday afternoon, skiing on Friday morning, taking a huge long lunch on Wednesday, and cramming in a tough 6 hour day at the office or on calls the rest of the week. They make Presidents Club every year and blow out their numbers and take home $300 to $500K on average.
The ones who are average at their jobs put in 60 hour weeks just to keep from getting fired for not making their quota. I don’t begrudge good sales reps one bit for the money they make, and I don’t fall into the trap of thinking that all the successful ones are sleazy, dishonest slime balls who would say anything to make a buck. They’re not! Sure there are some to be found, but no more so than those people occupy the ranks of realtors, lawyers, doctors, police, government or other industries.
If you want to make well into the 6 figures, you don’t need an MBA, you don’t need to have a rich father. Just get into sales and learn how to be succesful working for a good company with an in demand product. Whether that product is a house, a big computer, or an artificial hip, doesn’t make much difference.
ParticipantNo it’s not…. patience, patience. If you leave you’ll regret it.
kicksavedave, you’re one of rare ones in San Diego who won’t spend all his money on real estate.
————————————————-The problem with patience is that some people simply have more of it than others, and some people simply have more time to wait. My wife and I will be 40 this year, and we are both way behind on saving for retirement. Even if we did the unthinkable and bought a nice place and stayed in in for all 30 years and paid it off, we’d be 70 by then. We need to start socking away extra money quickly, and we have very little margin for error on the house purchase. Like you mentioned, we’re NOT going to do a toxic loan, or buy over our limits. But we also do have to take into consideration more than just “where we want to live”… we have to look at what makes the most sense overall. And spending $400K on a property that would run $150K in other, completely livable cities, well it’s hard to talk yourself into that making any sense. And thats IF, and only IF, those $600K houses, actually do come down to $400K. If they don’t, then we’ll just be 45 years old and have no equity…
What I wouldn’t give to be 25 and stupid again 😀
ParticipantI now might have a chance to repeat this same model again. I’m in discussions that could enable me to take a new position that would double my salary while depositing me in an area of CA that has housing prices that would enable a less than 3:1 homeprice to salary ratio (within 2.5 hours of SF). While I miss the heck out of OC and SD, I will NEVER indebt myself to the level I would need to in order to buy a nice home in a decent area there. I have come to fully subscribe to the notion of putting family financial health over personal indulgence – which is what a move back to SoCal would be for me given the current price environment and where the high paying jobs are. I like to fully fund my 401K, stock purchase plan, and have some left over for 529s, money market savings and taxable investements.
Does anyone else on this board share similar views?
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YES, whole heartedly yes. Trust me, if I could afford a decent property in San Diego for anything close to 3:1 ratio, I’d be staying here forever. But even making a combined ~$170K, a 3:1 ratio gives us a selection of crummy condos, hideous tiny SFRs in run down neighborhoods, or nice properties in the land of commute hell. I will not spend an 2 hours a day in traffic (2 hours now, three hours in ten years) just so I have enough room for all my furniture.
I LOVE San Diego, but waiting for a $600K house to drop to $400K is insufferable. Rather, it looks like I’ll be moving (somewhere, not sure where yet) and finding twice the space for half that $400K price. With the $200K savings on housing, I’ll be taking awesome vacations, enjoying some expensive hobbies (flying, boating, skiing, etc), having the choice of public or private schools for my kids, and still saving a ton for retirement. What good is perfect weather when you can’t afford a pot to piss in?
The only question left is, where to end up? What is the trade off for surrendering perfect weather for financial viability? Brutal humidity and mosquitos the size of pidgeons? Snow storms from September to May? Flat dusty boring terrain with nothing to do for 750 miles? Decisions, decisions! 🙁
ParticipantAnother option may be to simply call some regular moving companies. When I moved to SD from DC in 2001, my moving van showed up it already had someone elses Jeep Cherokee sitting inside it. Since my stuff didn’t fill his entire van, the mover was able to take us both out there (their Jeep and my furniture) on one drive. I asked him how much and I recall him saying something like $700.
May be worth making a few phone calls to see if a moving company can give you a bid.
February 1, 2007 at 3:50 PM in reply to: January Sales look strong some places and not so strong others #44631ParticipantI know this is a micro look at a macro issue, but right in my tiny little townhouse development, I’ve observed the following recent activity.
Last year my landlord offered to sell me the 1660 sqft unit I rent in LaCosta, for “about $500k”. After finding this site, and over several months of contemplating, I declined. During this time, a slightly larger (1800 sqft) unit across the street went on sale for $565K. Not a single look see, it showed like crap, because the owners left it a mess. After about 150 days it dropped to $535K. After about 300 days it dropped to $500K. So the bigger unit will now sell for less than my smaller one was thought to be worth a year ago, essentially on the same street.
In December, an identical unit to mine, except much more nicely upgraded, with granite, stainless, etc, went on the market for $470K. That unit sold in ~45 days, at $450K.
So the volume is there, so long as the pricing is realistic. Overprice a dump, it will sit forever. Price a nice property with realistic expectations, and it will sell. Looks like quite a few sellers in January understood this concept.
But the bottom line is, where my owner once expected $500K a year ago, he’ll now be lucky to get $435K for it. About 10% more and I might be tempted to reconsider:)
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