[mixxalot]

Ok perhaps I made a gross estimate.

1 bedroom condos in Point Loma are selling for 250-400k.

That would be about 2k a month which still is a lot more than my 1k rent each month.

[mixxalot]

I dont really see the rents increasing a lot here in San Diego either. I just renewed my lease in Point Loma for another 8 months for $1089/month for a 1 bedroom about a mile from the beach which is what I was paying last year.

Compared to a 4k monthly mortgage for an overpriced 1 bedroom cottage in Point Loma, I’d call that a bargain and wait for market to drop even further here in San Diego. It still is way overpriced to buy property here.

[mixxalot]

Ugh I despise planned communities with their overhyped extras and sky high fees! That and snooty rules for living.

I will never buy in one of these places. I would end up in a fist fight with one of the bozo neighbors!

[mixxalot]

Well I just renewed my lease for my 1 bedroom in Point Loma after client let me go from the Ventura project. I still have same rent as from a year ago so thats a benefit. The leasing office did jack rents up for new tenants as they pay $1200 a month for a 1 bedroom and I pay $1089 from 2005 so could be worse. I do not see any condos or homes that rent for $1000 a month in San Diego unless they are in the ghetto or hood.

Scott

[mixxalot]

Overpriced and poor quality

I looked at homes this past weekend in Ventura and Camarillo in southern California Ventura county. Most were overpriced between 675k and 900k for what you get.

[mixxalot]

You make a valid point. I think the new guidelines will bring prices down but slowly. Its good because we will actually be able to buy a new home for what its true value is and not the speculation. For me, I would be able to buy a 700-900k home that currently sells for 2 million which is fine with me.

[mixxalot]

Will this only affect San Diego or will other places like Ventura and Los Angeles be affected? It seems that places like Santa Barbara, Malibu, Ventura and Santa Monica where very wealthy movies stars and big shots live never are affected unfortunately. I might just keep renting even if I am paying 4k a month in taxes.

-Scott

[mixxalot]

Guys and cars and wealth

I like fast sports cars. They look great and are a lot of fun to drive fast. They put smiles on my face and make me feel great. If I had the bucks I would gladly have a new Lambo and Porsche 911 GT3 in my garage. Of course I would need a home and garage adequate for the vehicles.

[mixxalot]

Wait another year until next fall to really see if anything happens

At least thats my game plan. Besides, I really do not want to buy anything until the client decides whether or not to renew my contract for another year. I am saving right now for the downpayment and cannot risk losing work and being stuck in a 6,000 monthly payment with no cash in the bank. That would be suicide. For the next year to 18 months, wait and ride it out. I need another year to build up cash and credit anyways. Fortunately a cheap room does the trick and we can revisit the market a year or two from now. My co-worker who owns a home in Moorpark/San Fernando Valley pulled his home off the market and cannot sell it for the 1.1 million he wants. So it is starting to come back down but VERY SLOW process. Patience. Yeah and it sucks to pay massive tax but the year of per diem cuts down on taxes since I also use my room in San Diego as primary residence and pay little tax for the next year on the contract. Once it is decided to renew or not, I can cross the bridge of whether to buy a place in Ventura or Agoura Hills.

Scott

[mixxalot]

I make 200k should I rent or buy?

This is very interesting. I am saving for my first home purchase. Unlike flippers I dont look at it as pure investment but a place to live in a long time. My job is a 3 year contract with possible renewals. Work is plenty in technology in southern California. I plan to save up 100k as a down payment on a home. When should I buy? I rent a room currently for 550 per month which is dirt cheap and includes house privileges. My taxes are 10k per month since I am single and have no extra deductions. I could incorporate and use that but it would take some time and planning. Homes do not seem to depreciate much in coaster Los Angeles and Ventura that I am aware of.

Scott

[mixxalot]

I rent a room in a nice home in Ventura for $550 per month and have use of a kitchen, bathroom and living room. Its far cheaper than the ridiculous rents for $1300 per month in Camarillo/Ventura for a 1 bedroom apartment and far cheaper than a massive 5-8k mortgage payment each month. I get nailed on taxes but once I form the business and get this setup I can get better tax savings without the risk of home ownership. I am waiting a few years at least to see what happens to home prices in Los Angeles, San Fernando Valley, Santa Monica, Ventura, Orange County and San Diego. After all, how many suckers can really spend 5-20k per month on a mortgage? Maybe 1% of the population is my guess.

[mixxalot]

I really really hope that prices go down by 20-30 per cent as I save up my down payment for my first home here in southern California. It sucks because I am now finally making a decent living and will get nailed on my taxes. But at least my rent is only $550 a month since I am renting a small room in a house in Ventura close to my job. Then again even if I was rich and could buy a new home for a million bucks at the insane prices today if I was layed off tomorrow it would be a disaster. One can never know if work is secure anymore which makes home buying risky. The only real irritant are my lucky bastard co-workers who bought years ago and brag about how much their homes are worth. One guy is trying to sell his place that he paid 500k for years ago for 1.1 million.

I agree dumb asses with money will always buy homes and overpay. Case in point- the filthy rich neighbor of my co-worker who wants to sell his place in Moorpark near Ventura in San Fernando Valley is willing to overpay on a home for his son.

Well I will sit this one out a few years on the side lines. Since I had to do a chapter 7 BK this past year due to a layoff I cannot even think about buying a home without a major cash down payment in 1-2 years. SO I will bite the bullet and save save save and pray to keep my new job and not piss off my roommate in Ventura to keep the cheap rent.

Which is better?

Case 1

Income after taxes (no home)

100k cash after expenses (based on 200k income)
rent=550/month for small furnished room in Ventura
20k toward 401k

Case 2
Buy new home at 900k
Income 200k before taxes

[mixxalot]

Yeah I see a lot of lucky bastards who got in on low priced southern California real estate 10 years ago when it was cheap. They now own expensive estates in Malibu and Rancho Santa Fe. My boss is one of these guys. When he tells me to buy, I cringe and feel like telling him “Gee, why would I want to spend 700k on some crappy place and then have it lose 200k in value 5 years from now? Will you give me a 200k loan to cover the loss in real estate value if I buy this hovel today?”

That and I work in the computer IT field and layoffs, downsizing and outsourcing of jobs to India and China happen constantly. No job is secure anymore and I cannot afford a 6k monthly mortgage if I lose my job tomorrow. Yes, taxes suck but I only pay 550 a month to rent a room near work and do tax strategies on investments until the real estate market corrects itself in 5 years.

[mixxalot]

Thanks for the great advice! I am in Ventura/Oxnard area and prices are way too overpriced here. Heck at least San Diego was a nice area! Oxnard is a shithole and only reason I live here and rent a room is to save money on the project.

I sent my boss the link on 401k plans and will work with him to set it up for employee/consultants. As for the home office deduction, I can use that per advice from my CPA in San Diego and since I keep a residence for time being still in San Diego I get a good break on taxes up to 1 year using per diem rates.

-Scott

[mixxalot]

What about places like Malibu and Ventura in Los Angeles and Ventura county? Do you think these areas will experience a downturn in housing prices for real estate? It seems like the very rich don’t care about paying too much for a home to live in an exclusive area like Malibu, Beverly Hills or Pacific Palisades .

[Author]

Posts