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I recommend State Farm; I’ve noted a couple reasons below:

1 – Their home insurance policy does not discriminate based on dog breed. i.e. I have a higher rate because of the dog, but they didn’t ask which breed I own (several insurance companies wont insure if you own one of the “scary breeds”).

2 – State Farm was very fair and moved rather quickly when handling a recent fire claim (My house was in the heart of the San Marcos wildfire burn area last May).

3- Motorcycle insurance premiums for me while I was young and in college were about 10% of what the “big” motorcycle insurance carriers (Geico, Progressive) wanted to charge me.

They may not be the cheapest, but prices are still very reasonable, and I trust (based on recent experience) that I’ll be covered in the event of an accident/disaster.

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I am getting a 7.7K system installed by Sullivan Solar Power (based in San Diego County) as I type this post. Everything has worked out excellent thus far and it should be a good return on investment (I purchased the system outright) with a break even point of 6.5 -7 years. If you are interested in getting a quote from Sullivan send me a private message…. Sullivan will give you and I both a $500 referral bonus (check/cash , not a reduction in contract price) once you install the system. Sullivan provides a system production guarantee for 10 years (with web based production monitoring), 10 year system insall warranty, and 20-year warranty on the inverter (I hear they typically go bad at 10 years). Sullivan wasn’t the cheapest quote I got (they were close), but they were very professional/knowledgeable and have excellent reviews — plus they are a local San Diego County based company and an Ernst & Young EOY semi-finalist http://www.ey.com/US/en/About-us/Entrepreneurship/Entrepreneur-Of-The-Year/SD_Semifinalists

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[quote=livinincali][quote=CA renter]
In states with high income tax it might make sense to offer corporate tax breaks. For example Facebook made about 1.5 billion last year and CA corporate tax is 8.84% so CA got $126 million in corporate tax from Facebook barring some kind of tax break that I don’t want to investigate. Facebook spent 6.4 billion to generate that 1.4 billion in profits and let’s just guess that at least 75% of that expense is in labor costs. So 4.8 billion but let’s just round to $5 billion in labor to make the math easier. Income tax in CA is 9% and for many people at Facebook it’s higher than that. So let’s just assume a blended rate of 8% on that $5 billion in labor. So CA collected 5.0*0.08 = $400 million in income tax from the Facebook employees. So CA get’s 3+ times the amount of revenue from Facebook employee incomes vs corporate tax rates. So keeping those jobs is far more of a revenue benefit than losing them because of a couple of percentage points in corporate tax breaks.[/quote]

Agree with the point you are trying to make — increasing business activity is the best way to increase tax revenues. However, the math you used to calculate CA’s tax revenues from FB has seriously flawed assumptions. 1 – Not all FB employees are California tax payers, 2 – The computation used to derive GAAP income (which you probably pulled from a 10K filing), is significantly different than the calculation of Taxable income. FB likely reported a significantly lower tax (vs. GAAP) income due to employee exercises of in-the-money stock options (Per the 10K, these “excess” tax deductions resulted in a reduction of cash tax liability greater than $600M in 2013), 3- California only gets to tax income attributable to California sources — which is very likely significantly less than world wide income (apportionment rules).

Proof of this is in the financial statements — FB’s US state CASH income tax liability for all of 2013 was only $69M. You can assume less than 50% of this was paid to California due to apportionment rules and the Company’s global presence.

My best guess is that FB pay little or no Corporate income tax in California due to the facts above and the availability of R&D tax credits.

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[quote=CA renter][quote=SK in CV][quote=CA renter]

We DO need more revenues, and there is no doubt that the state and municipalities are losing billions each year on these subsidies. They are not needed and, IMHO, can distort the market, as well. We need to split the rolls, at the very least, and there is quite a lot of energy behind this.[/quote]

I disagree. We don’t need more revenues, we need politicians that spend less and citizens that rely less on government services.

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The majority of W-2 workers that own rental property in California generally will not benefit from depreciation deductions (losses on rental properties). I won’t go into all the specifics, but unless you are a full time real estate professional you won’t be able to offset ordinary income with passive rental losses. There is an exception to this rule based on income limitations — however, those that own rentals in SoCal or the Bay Area are likely making too much money to realize the benefit.

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Your tax effected payment calculations are misstated; Only the interest and property taxes are deductible. Further, the property tax deductions won’t shield you from The AMT. You do not get a tax deduction for principal, insurance, HOA, and, under most circumstances, MR tax.

I purchased my first home in 2009 and turned it into a rental last October after making a “move up” purchase into a undervalued “fixer” property.. After crunching the numbers, I’ve realized that I have too much equity in my rental at current prices to justify holding it. I’ll be selling later this year to “lock in” my gains tax free (primary residence exclusion). However, I do hate to lose the leverage at a 3.5% interest rate….

To summarize- I think the market has gotten ahead of itself and it’s a good time to sell (assuming you don’t need a place to live).

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Try State Farm, they have been good to me. No problems insuring my two homes in “high risk” fire areas through them. They also do not discriminate against dog breeds, my Rottweiler was non- issue (several insurance companies would not cover me due to the dog).

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Your payment and required salary figures seem high to me. In years 1 and 5, I compute monthly payments of $2,700 and $3,900 respectively. Assuming a 36% front-end ratio, then your annual salary figures are also overstated.

I think housing is still cheap compared to costs of renting, especially when you factor in tax benefits of owning. For example I am renting my $420K home (zillow estimate) in San Marcos out for $2,500/month. It would cost less than $2,300 to carry that property (PITI) with 20% down. After tax benefits the cost to carry is less than $1,900.

Therefore my opinion is that salaries won’t need to increase at the same rate as monthly mortgage (PITI) payments to support further housing price appreciation. A combination of catch-up in rent vs. buy analysis and salary increases will get us to 5% appreciation per year over the next 3-5 years.

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I agree that buying during the ” frenzy” is not the best move if you are looking short term (some may have overpaid up to 10% or so), but in 10 years that difference will not leave you underwater and will most likely have been a better long run financial decision than buying at today’s/tomorrow’s higher rates(assuming buyer is financing the transaction).

I am in escrow now on a second “move-up” home and in hind sight would have gladly traded paying a little more during the “frenzy” so I could have taken advantage of the extremely favorable mortgage rates a few months back. However, I’m more concerned with carrying costs than overall principal (purchase price) as I plan to hold LT. I also prefer the “fixers” that don’t get caught up so much in the” frenzy” pricing.

Everyone is so concerned with a “bubble” and quickly appreciating prices. Anyone else believe that the price move we saw early this year was the adjustment needed to bring prices back to sustainable market levels after a post bubble over correction? From here, I project modest price increases (5% per year) coupled with interest rate increases over the foreseeable future.

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Buy a house with as little down as possible with a 10 year outlook while interest rates are low and I’d be willing to bet you will be better off financially in 10 years than if you had rented an equivalent house. Even those who purchased during the peak will have some equity in a few years (if they don’t do so already). Don’t do stupid sh*t like take a HELLOC out to buy a hummer and boat and you should be OK.

If the market crashes, the government has made it clear they will be there with the bailouts. It will take a serious economic collapse to leave you underwater on a home in 10 years from now. If such collapse were to happen, your negative equity won’t matter. What will is how much guns/ammo/food/gold/supplies you have stashed away.

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Paramount, most of your list could have been had in San Marcos sans the hellish commute, no?

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I’ve closed two refinance transactions with Box and have been happy with them each time. They move fast compared to my experiences with other lenders/brokers.

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Hi bake,

We are looking at a house in San Diego county (San Marcos). The purchase price is $530K. If we can’t find 80/10/10 financing, our other option is to make it our primary and get a low downpayment (and no mortgage insurance) loan through Navy Federal Credit Union and rent out our current house (also in San Marcos).

Thanks,

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The move in the 10 year over the past several weeks has actually been pretty dramatic. The yield has increased roughly 80 BPs (or approximately 49%) since early May.

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Good luck on your refi, let me know how it goes. The big banks can’t compete with Box due to their higher overhead and the fact that Box only works with 700+ FICO score borrowers. I shopped Box against Bank of America and Quicken Loans. Both BofA and Quicken wanted $3K more in closing costs and their rates were .25-.5% higher than Box. I even had one of those “guaranteed beat or match” refi offers from Quicken. Turns out Quicken advertising is a bunch of lies and would never recommend them to anyone.

I’m lobbying the Box Home Loans management to make an exception to the 6 month refi window so I can do a cash-out refi. My last appraisal came in much higher than anticipated and I’m looking to pull cash out while the money is practically free. 🙂

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