[ocrenter]

[quote=kkun]By any shape or form, this is a ridiculous bond. The original structure is bad. Additionally, I don’t know why it was not refinanced in this historially low interest rate period. In my job I deal with investments, etc and my boss would have fired me if I agreed on this bond. For sure.

I generally agree that we share the responsibility of not being engaged enough to oppose when these proposals come up.

As an individual, if I had
(a) $60k in the bank earning close to 0% interest
(b) my income in AMT bucket (meaning no tax deduction benefits from MR)
then I would pay back the MR bond now. It is a better option rather than paying a 6%+ bond rate for at least 30 years if not more

I know many in the forum have different view (eg don’t pay back MR if you are not planning to stay in thouse for at least 10 years). The main fear is the next buyer will not pay higher price for one house in neghborhood where all the house has MR. Somehow, I thibk there will be knowledgable buyer who will pay me $60k instead of signing up for $500 payment per month for 30- 40 years.[/quote]

I do agree about finding that buyer who does recognize the benefit of a property with paid off MR.

I do feel most folks recommending MR payoff are being very conservative with their 10 years or more recommendation simply because there’s been very little transactions to point to.

[ocrenter]

[Quote]Thanks for taking the time to post that BB. It’s an eye opener and just highlights the problems with these projects using taxpayer dollars. They NEVER finish on time and they ALWAYS go way over budget. And ultimately all they have to say is “oops…we need more money” and the taxpayers are on the hook.[/quote]

Problem ultimately is there is zero accountability. So what if a hospital went over budget by 1/2 billion? Pay is not reduced, no one got fired, you don’t even hear any investigations or news articles on this major mishandling of public funds. On the other hand, let’s say the administrators did complete the hospital on time and on budget, there’s zero reward for that type of accomplishment either. End result is projects run into problems, we’ll just throw more money at the problem because it really is just other people’s money.

[ocrenter]

[quote=earlyretirement]

The Board members of PUSD were DEFINITELY shady. No doubt I put the majority of the blame on them. NONE of them should ever hold public office again! The point I was making is what you touched upon, ocrenter. That the voters wanted the improvements, they refused to pay for it with higher taxes. But they listened when the PUSD said that they found a way to do it without raising taxes.

Palomar is a monster. I read today where they just laid off a bunch of employees. They still aren’t getting the traffic that they anticipated.

And people like you don’t count for that credit card APR I mentioned. LOL. I’m like you. I never keep a credit card balance and just pay it off each month so my APR is simple. 0% same like you.

But you get the gist of what I was saying…. it’s not pretty…[/quote]

I hear ya. There’s no such thing in life as a free lunch. Of course nobody bothered asking “how” when the free lunch was offered. 🙂

http://www.smartvoter.org/2004/11/02/ca/sd/prop/BB/

Found the old proposition BB back in 2004 approved by the voters. Looks like they went over-budget by 1/2 a billion… whoopsie, what a silly mistake!

Pretty sad really. The voters get screwed if they vote yes for added property tax. The voters also get screwed if they vote no for added property tax. There is simply no oversight and no accountability for elected officials.

[ocrenter]

[quote=earlyretirement]

I totally agree with you ocrenter. I’ve found in life that the vast majority of the people out there are financially clueless. As well, they only think about today/tomorrow/next week. They don’t really project and think out into the long-term. Especially here in San Diego where many people kind of have the “live for today” attitude.

PUSD is fortunate that most of the property owners are almost “financially retarded”. (and no offense to the mentally disabled). These PUSD homeowners are also to blame for these ridiculous capital appreciation bonds. They can blame the Board but they also share in the blame for voting for such a horrible thing. Sometimes 1+1 really does = 2.

What the PUSD is simply banking on is homeowners continuing to be clueless as always and just keep paying these CFD’s. After all, most don’t even have ANY clue how long they are for, what the scheduled pay off date is, what the interest rate is on them or really ANY details at all. All they know is they see it on their property tax bill each year and they pay it each year.

Heck, I’d venture to guess that most PUSD homeowners don’t even have any clue what the APR is on their credit cards! LOL.[/quote]

If I recall, I don’t think PUSD residents actually voted for the capital appreciation bonds. I think how it went down was they voted against further tax increases, and the PUSD board had to go out and find creative financing to complete the projects after the vote. How the board members justified it was very passive aggressive: aka, voters wanted the improvements, they refused to pay for it with higher taxes, so we were left with no choice.

What I find outrageous is the cost of these public funded projects. $150 million for Del Norte High? Hey, but that looked like a total bargain for the $1 billion for Palomar Medical Center. and remember, even at $1 billion they still ran out of money to build the maternity ward.

btw, I’m guilty of your last example. I have no idea what the APR is for my credit cards. 🙂 but then again, we are the worse type of customers for the credit card companies as we never keep a balance for them to make money off us.

[ocrenter]

[quote=xgliu128]without hitting AMT, I might think paying off mello roos might not be good based on some simple calculation. say 6K annual payment, pay-off amount is 10x, that is 60K, interest rate is 4%. 60K can become about 120K in 20 years. 6K annual payment with tax benefit will become about 4K annual payment. in 20 years, i will pay 80K total, still less than 120K.

but i agree long term uncertainty is another big factor…[/quote]

I would not do it just for long term uncertainty. How realistic is it that you’ll still be at the same house 30 years from now?

I agree with your calculation. Except to say most folks on the hook for a $6k MR generally have the income that pretty much guarantee they’ll be on the hook for AMT yearly as well. Unless you are one of the lucky few that can deduct most of it away.

[ocrenter]

[quote=earlyretirement]

I mean realistically, what would homeowners due if by 2045 (or whenever the last payment is due) all of a sudden they say it needs to get extended 5 more years… what recourse do homeowners have? If anyone knows that answer, please post. The legal paperwork for the CFD’s was so long and complex that I think even most lawyers would get confused by the technical jargon in it. It’s almost as if some lawyers sat around a room when drafting these CFD’s and said, “let’s make the wording so complex and difficult that no one will really be able to decipher the meaning…..”.

And I TOTALLY agree with you that it doesn’t make sense for everyone. Especially in a transitional town like San Diego where people seem to come and go all the time based on job losses, weak economy, etc. I’d only recommend it for people that know for sure they will stay in the area for the long-haul or at least for many many years.

In a hot housing market like now, I think you will ALWAYS be able to sell and get back all you prepaid and probably more. But in a recession or difficult housing market who is to say how difficult it might be to recover these pre payments. Especially from people that might not plan to stay in the house “forever”.

I already knew that this was our “forever” house. It’s plenty big even anticipating for having another child if we do.

But for people in a similar type situation, it seems like a no brainer to me to pay it off ahead of time and get rid of the obligation.[/quote]

Of course, very few people look at and plan for 2045, and how many of us will truly stay in the same home until 2045. This is what PUSD is banking on. They figure the great majority will just keep paying and not even realize the MR was suppose to stop.

[ocrenter]

[quote=earlyretirement]

As well, besides the 2% annual increases, it looked like they can extend out these CFD payments beyond the scheduled termination date. I liked the fact once you paid it off it forever releases you of ALL CFD obligations.
[/quote]

ER mentioned a very important point. With PUSD engaging in what can only be described as simply very creative financing, it is quite likely that they’ll try to extend CFD obligations when the sh#$%$ hits the fan in a few years.

Just don’t do what this guy in Stonebridge did:

[img_assist|nid=17315|title=substation view|desc=|link=node|align=left|width=300|height=225]

So the owner pays off part of the MR. But then needs to sell in less than a year. The lot is a deficient lot due to the view of the substation in the backyard.

I would have simply spent some money to plant in some mature trees that would block off the substation view.

MR pay off is for folks that are done with all of the necessary home improvements and they are in for the long haul. It is not for everybody.

[ocrenter]

[quote=xgliu128]Hi, I have 2 questions related to 4s ranch mello roos. maybe general mello roos rules/considerations.

1. seems large portion of mello roos might be tax deductible now, at least CA FTB removed the section to enforce mello roos is not tax deductible.
http://www.sfgate.com/business/article/Calif-drops-property-tax-deduction-campaign-3486711.php#page-2

so will paying mello roos tax and getting tax benefits have a much better advantage than paying off mello roos upfront now?

2. how mello roos for the bond is calculated between homes built in 2012 and homes built in 2005?
say a bond issued in 2005, and the cost is split by 50 homes built before 2005; and after another 50 homes are built in 2012, is the cost now shared evenly across all 100 homes and be recalculated?[/quote]

in regard to question #1. it depends on whether you are on the hook for AMT. If you are paying AMT yearly, your property tax is not deductible. Therefore, there’s no benefit in having a larger property tax payment.

as for question #2. cost is not recalculated. you are still looking at the same payoff and the cost is still increasing at 2% a year.

[ocrenter]

[quote=kkun]My insurance is from Chubb.[/quote]

x2

[ocrenter]

[quote=sdsean01]Long time lurker, first time poster. We been looking for a house in 4s, and Scripps Ranch for good 6 months. Our factors going in were

1) Family neighbourhood.
2) No free-way noise, and no busy streets. Lived in Mission Valley for a while.
3) Newer home.
4) Decent size backyard.
5) Good school district.

We picked Stonebridge over 4s areas for the following reasons.

– Just feels away. For the first few visits it felt out of the way. I guess that is why we kept going back :).
– Decent size yards, both front and back.
– Poway school district.
– Hike right off your house.
– We looked through all the builders who have projects in Stonebridge, and found Tollbrothers product far more superior for the price, and got to pick stuff.

4s has newer homes as well but it just feels very closely built.

MR in Stonebridge is high, but I felt it is priced in to greater extent, comparatively. For e.g. Older home no MR, and close to Pomerado proximity was around $260+ PPSF.

Yes there are areas/divisions which suffer from Power lines, so watchout.

Glad to see happy Stonebridge campers on board.[/quote]

for a while Stonebridge offered the best value for the dollar precisely because so many people had negative preconceived notion about the location. For the longest time, Scripps Ranch residents did not consider Stonebridge as part of Scripps Ranch.

As the market improves, as the community matures, and as the lots get built out, that price value is gradually going away.

[ocrenter]

[quote=sunny88]After looking at every single new neighborhood from “Calabria” to the Toll Brothers we decided that Stonebridge was not for us. We did liked the homes a lot but did not like the location at all. Stonebridge is too remote and driving from Pomerado to the newer neighborhoods was a long drive. We also did not like the fact that there were no stores in Stonebridge. Many of the homes had views to power lines and the MR was the last straw that broke the camel’s back. We ended up buying a wonderful home in Poway.[/quote]

Poway is a beautiful city with a lot to offer. I personally think you can’t go wrong with the entire 56/Ted Williams corridor from the I-5 to the 67. Congratulations on your wonderful home.

[ocrenter]

[quote=The-Shoveler]One or two notes!!

If you got Coyotes in the hood, best not to let small children play unsupervised or without a large adult near them.

I have heard of them grabbing small dogs from frail looking adults hands.

If they think they can take advantage or have the advantage (well don’t trust them).[/quote]

For a while in and around Laguna Woods the coyotes routinely attacked small leashed dogs while the elderly owners were walking them. Classic example of taking advantage of frail and elderly owners. Once they get a taste of pets (fattier than your typical wild rabbits), they’ll stay around the neighborhood for more.

[ocrenter]

[quote=kkun]
– As you all know fire hazard is a concern. Getting home insurance was a pain. We almost dropped out of escrow because of that. It still concerns me that majority of insurance companies don’t inusre these houses for obvious and right reason of high chance of wild fire

[/quote]

well said, agree with all of your points.

these homes are significantly better equipped to deal with wildfire, IMHO. if you look at most of the homes facing the canyon, at least clearance of 40-60 feet exist between structures and the canyon. if you look at some of the homes destroyed in the RB or Scripps Ranch fires in ’03 or ’07, some of them were only 10-15 feet away from brush.

In addition, you no longer have attic vents underneath the roofline that actually draw ambers into the attic during a fire.

[ocrenter]

[quote=Navydoc]They’re not THAT close to the road, and exhaust for a car moving at 45 MPH is not that great. The cars idling at Penasquitos or other close neighborhoods would be far worse. Noise is definitely the concern at Stonebridge.[/quote]

Plus there’s not nearly the amount of volume for the exhaust to be of concern. Density is one thing Stonebridge does not need to worry about.

lizards, snakes, and coyotes, yes.

density and exhaust, no.

🙂

[ocrenter]

[quote=sbridge2013]I see some house back to Stonebridge Prkway. Any Idea how the noise level is for those houses? Is it worth looking those houses?[/quote]

That’s a difficult question, as you have ones at street level then you have ones high up above. You also have homes downstream to the park with a lot more traffic on Stonebridge, vs homes above the park that gets a lot less traffic.

Worth simply walking around the target street during AM and PM commute hours just to see.

[Author]

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