[Steve Beebo]

For someone moving to San Diego, the key is to know where you will be working, (if you’re working), and then look at housing areas at least somewhat close by. You really don’t want to live in Vista if you’re working in Mission Valley, and you don’t want to live in the South Bay if you’re working in the North County.

[Steve Beebo]

Perry –

If someone is renting right now, I’m not suggesting that they rush out and buy a house or condo. Certainly, they could get a better deal next summer or the summer after, even if prices were only to slip a little. I’m just saying that they need to buy at some point, because in the long run, it’s better to have a mortgage that you are hopefully paying down, eventually to zero (assuming the mortgage can be afforded). The strategy of renting now, and investing the difference can work in theory, but the reality is that Americans as a whole, whether they are renters or property owners, really don’t save very much, and some renters will not actually be investing and saving the difference.

[Steve Beebo]

PS –

Six funds:

ABALX
AMRMX
ABNDX
CWGIX
CAIBX
AMECX

You’re on –

[Steve Beebo]

Perry –

This doesn’t apply to someone who may have purchased their first home between 2003 and 2006, but in general, buying a home has always been a good investment, and will be again soon. If you bought a home today, or in two years, with a 30 year fixed, your payment will always be the same, vs. renters who will probably see their rent increase every year. And isn’t the eventual goal of most homeowners to have their house paid off when they are retired?

[Steve Beebo]

Powayseller –

I would take the challenge vs. your CDs, but could we start the calculation this past March so I could have a little head start, or do we have to start from now?

[Steve Beebo]

Future SD Guy: “The Palomar airport road looks like a promising route for an early morning commute to wherever I might work.” It might look OK on Google Earth, but it isn’t that great at 8 AM or 5 PM.

Vista isn’t that bad, though, there are plenty of nice areas, but I wouldn’t want to have a regular commute from Vista any farther than to Oceanside, Carlsbad, or Escondido.

[Steve Beebo]

ps –

I’ve had money in mutual funds since 1990 or so, and I always will. The returns are better over time than any other investment. I didn’t lose half my money in 2000, and I don’t invest in individual stocks. I prefer conservative mutual funds, including some income funds, that don’t do quite as well in bull markets, but which do way better than the market as a whole in bear markets. Weren’t you advising people that we had to get out of the stock market 4 or 5 months ago?

[Steve Beebo]

I invested in six separate mutual funds about 18 months ago, and on average, the return is almost 15%, with only one under-performing fund, (a bond fund).

[Steve Beebo]

This property had recently been listed at $595,000, and the comments in the listing indicate it was something of a distress sale, and a probable short sale. The transfer was to Charter One Bank, which had one of the mortgages on the property.

These are recent mortgages which were done on the property:

5-05 $180,000
9-04 $115,000
4-04 $100,000

The house last sold in 1999 for $250,000

[Steve Beebo]

Some builders are going to be in real trouble, but other builders, who may have bought their vacant land or vacant finished lots in 2004 or earlier, are going to be just fine. Their sales will be slower, and they will most likely be giving big sales concessions, but some will still be profitable.

Let’s say you are a builder in San Diego, and you bought a large vacant parcel in 2002 or 2003, intending to build in 2005 or 2006. Even at todays’ lower prices, you may still turn a profit. You won’t make as much money as you would have if you had sold your homes 12-18 months ago, but you can still sell your homes at much higher prices than you could have gotten in 2002/2003.

Think about a company like Pardee Homes, who owned property in Carmel Valley back to the 1970’s. Their cost basis is so low that they can’t lose money no matter what they sell homes for today.

In the early to mid 1990’s, there were still new homes being sold, even though there was a housing recession in Southern California. The builders who went broke were those who had bought their land just before the market went in the toilet. The builders who will be in trouble this time will be those who purchased vacant land/lots around 2005.

[Steve Beebo]

Here are all of the sales since 2002 from the MLS for the 3 BR model (1232 sf)

17161 ALVA RD 722 $275,000 7/30/2002
17161 ALVA RD 3223 $275,000 11/7/2002
17161 Alva Rd 723 $275,000 3/4/2003
17161 Alva Rd 2224 $280,000 4/17/2003
17161 Alva Rd 2213 $280,000 5/28/2003
17161 Alva Rd 713 $282,000 7/24/2003
17161 Alva Rd 3311 $310,000 12/17/2003
17161 Alva Rd 2213 $345,000 3/12/2004
17161 Alva Rd 2212 $369,000 4/10/2006
17161 Alva Rd 3313 $395,000 6/27/2005
17161 ALVA RD 723 $402,000 3/11/2005
17161 Alva Rd 2213 $405,000 6/3/2005
17161 Alva Rd 3223 $406,000 8/31/2005
17161 Alva Rd 722 $408,000 5/27/2005
17161 Alva Rd 3314 $410,000 10/12/2004
17161 Alva Rd 714 $420,000 8/12/2005
17161 Alva Rd 3323 $424,900 7/6/2004

There is only one active listing of the 3 BR model – at 369K

FWIW – the highest and the third highest sales were “view” units, and the second highest sale had been remodeled.

[Steve Beebo]

I’ve read that the State Dept. of RE is investigating, but is the D.A.’s office in San Diego also investigating the fraud? And why hasn’t this lowlife been arrested in the identity theft / fraud?

[Steve Beebo]

What’s the address of the one you say is in escrow – and is it on the golf course?

[Steve Beebo]

Masayako –

What’s the street address of the pending sale – I can’t find it on the MLS.

The sale at $530,000 was on the golf course, though.

There were two other recent non-view sales of the same model:

One sold 5-06 for 487K, and the other sold 7-06 for 467K.
The sale at 487K had a greenblet view, but no golf course view like the 530K sale.

[Steve Beebo]

Lendlingbubbleco:

Did you really use the phrase “It’s going down clown”? Nobody has ever said that phrase to me before. In fact, I don’t know if anyone in the history of the world has ever said that exact phrase. But – no offense taken.

I do sometimes like to play the devil’s advocate, because even though the market in San Diego is not very good, and is likely to get worse, I don’t see a future freefall of prices to the tune of 40/50/60%.

The median price of an SFR is now $555,000, unchanged from 12 months ago. I’ll agree that there are more concessions this year on resales, but not much more than 2% average, if that. If the median drops 10%, to 500K, I think that more buyers will jump in. If it drops to 475K, a 15% drop, even more buyers will show up, as long as the job market stays OK.

Of course, my house can NEVER drop 15%. And I did sell two investment properties in the last two years, so that proves I’m not a complete idiot.

[Author]

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