patrick.net

We are worried about living in the Phoenix heat, but I'm sick of not having a nice house and paying so much in taxes. $800K does not buy you a nice house in a nice area in San Diego...sorry. I just don't see it when I'm on Redfin.

CA politics and taxes blow chunks, and I'm worried about building long term wealth with how much CA wants to tax me. It's a hard decision

Well, we ended up staying in San Diego. We're going to continue renting and amassing cash for when the next crash happens.

That was my comment above, but forgot to log in.

San Diego is a pretty choice place to live. Especially if you have a house already. Otherwise, renting at least comes with the perk of not having to fix stuff that breaks on the house, or spend money on upgrades. Tile grout black? No scrubbing for you! It's a feature!

anonymous says

Well, we ended up staying in San Diego. We're going to continue renting and amassing cash for when the next crash happens.

You will be renting for a long long time.

San Diego was lovely-stayed there for a few years. It was cheap back then-just past the crash. Phoenix is tough. A couple of my friends there and I call and I guess even night stay at 95 during summer.

Where I live-oh well.Someday I will move again-got a very nice gig going and low cost of living. Just take nice vacations in winter!

Would you surf the waters of San Diego? Pollution keeps getting worse. And then there is hep, hep, hep-a-ti-tis.

Since 1991, I've been telling myself I will accumulate cash and buy at the next crash. Yet none of the crashes were ever enough to cause me to pull the trigger. Recently, after 28 years I quit lying to myself, and knowledged I will be renting for life.

anonymous says

Well, we ended up staying in San Diego. We're going to continue renting and amassing cash for when the next crash happens.

Famous life-long renter words.

Blurtman says

Would you surf the waters of San Diego? Pollution keeps getting worse. And then there is hep, hep, hep-a-ti-tis.

This is why we should round up all the homeless and send them to Detroit. They will fit right in.

Best deal is if you can find a seller you can work with directly, use a lawyer and cut out the bullshit. Personally $800k sounds really pricey for a place in the desert.

They'll just return to collect welfare in CA

Strategist says

Blurtman says

Would you surf the waters of San Diego? Pollution keeps getting worse. And then there is hep, hep, hep-a-ti-tis.

This is why we should round up all the homeless and send them to Detroit. They will fit right in.

NuttBoxer says

Best deal is if you can find a seller you can work with directly, use a lawyer and cut out the bullshit. Personally $800k sounds really pricey for a place in the desert.

In normal markets this is possible. In hot markets like the Bay Area, this is not even the slightest option because too much competition is making offers to the seller.

BayArea says

anonymous says

Well, we ended up staying in San Diego. We're going to continue renting and amassing cash for when the next crash happens.

Famous life-long renter words

Maybe I just got lucky - but it worked for me when we bought in 2011. We rented in San Diego for nearly 15 years before we finally bought.

My realtor hated me. I strung her on for 2 years and probably looked at 70 homes. I wouldn't settle. It helped that we weren't in a hurry, our kids were still very young and not in school, and we were renting a killer place a few blocks from the beach.

Blurtman says

Would you surf the waters of San Diego? Pollution keeps getting worse. And then there is hep, hep, hep-a-ti-tis.

I surf once or twice a week in PB. Never caught anything.

NuttBoxer says

Blurtman says

Would you surf the waters of San Diego? Pollution keeps getting worse. And then there is hep, hep, hep-a-ti-tis.

I surf once or twice a week in PB. Never caught anything.

I surfed in PB/La Jolla for 15 years and never caught anything. Imperial Beach on the other hand is a fucking mess thanks to Mexico. I'd never surf down there.

BTW - I am loving North County surf since I moved up here in 2011. Carlsbad, Oceanside and Encinitas have some great spots and are not nearly as crowded as the city beaches.

I live in South Bay, so I've surfed IB more than a few times. Never caught anything there either, but I never go out in IB without checking the county water quality report first.

Grandview is one of my favorite uncrowded north county breaks, and Tamarak.

Strategist says

You will be renting for a long long time.

Talk to someone who bought in 2005.

BayArea says

anonymous says

Well, we ended up staying in San Diego. We're going to continue renting and amassing cash for when the next crash happens.

Famous life-long renter words.

Let's see. $3200/month to rent, or $4500/month + $180000 down payment to own. I think I'll try avoid getting a swift kick to the nuts.

just any guy says

Let's see. $3200/month to rent, or $4500/month + $180000 down payment to own. I think I'll try avoid getting a swift kick to the nuts.

Do the NYT on it before you make such a swift determination. I bet it is cheaper to own if you plan on being there for 10+ years.

joeyjojojunior says

Do the NYT on it before you make such a swift determination. I bet it is cheaper to own if you plan on being there for 10+ years.

You may be right, but who knows how long I'll be here. I'm not a dentist with my own practice nor do I work for the government where I know I want to retire. I'm a corporate executive with less job security and with also a desire to jump companies if something much better comes along. I don't want to be under water because I bought at a peak, which is my biggest fear, and I don't want to have to wait 10-15 years to break even on selling my house.

Yep--flexibility is a very legitimate reason to rent. I completely understand your reasoning.

just any guy says

Strategist says

You will be renting for a long long time.

Talk to someone who bought in 2005.

My gardener did. He bought a house with no money down, stayed free for more than 2 years before they kicked him out. Lucky bastard.

just any guy says

I don't want to be under water because I bought at a peak, which is my biggest fear

You understand that pretty much by definition, when you buy you buy at what is then the "peak" correct? The only way to get around this is to buy in a declining market (which scares the shit out of everyone) or go back in time and buy in 2012.

As such, if you examine your words, I think you will agree with others that you very well could be renting for a long time - perhaps forever. I am not saying this is bad however - just be very self aware of what your risk tolerance is. You may just find that buying is not right for you. Likewise, understand that if you don't buy, you very well will be nibbled to death in rent increases where you have no choice to move away. This choice isn't great either, but again, its all about self awareness IMO.

Strategist says

just any guy says

Strategist says

You will be renting for a long long time.

Talk to someone who bought in 2005.

My gardener did. He bought a house with no money down, stayed free for more than 2 years before they kicked him out. Lucky bastard.

If the 2005 buyer could afford it, in most places he is above water now. And he is now 12 years into his note - 18 years til being payment fee and eating through principal at a very fast rate. I'm sure the first years of worry sucked, but he would much rather be where he is now than having rented for 12 years and NOW thinking about starting that 30 year clock to freedom.

somecrappynumber says

If the 2005 buyer could afford it, in most places he is above water now.

Calculated against inflation? Guessing not.

somecrappynumber says

30 year clock to freedom.

If freedom can only be purchased with 30 years of slavery, it's not worth shit. 30 year originated for vets, 15 used to be standard. For responsible people, 15 is still standard.

NuttBoxer says

Calculated against inflation? Guessing not.

I said above water in part because of principal pay down - inflation is a fair point and more important if you are looking at better investment, but this has little to do with under/above water which is nominal.

NuttBoxer says

somecrappynumber says

30 year clock to freedom.

If freedom can only be purchased with 30 years of slavery, it's not worth shit. 30 year originated for vets, 15 used to be standard. For responsible people, 15 is still standard.

Ok then, for the responsible person that would be 12 down, 3 til freedom. Still, even at 30 years, very few people who rent for 40-50 or 60 years would call a mere 30 year payment term "slavery"

somecrappynumber says

As such, if you examine your words, I think you will agree with others that you very well could be renting for a long time - perhaps forever. I am not saying this is bad however - just be very self aware of what your risk tolerance is. You may just find that buying is not right for you. Likewise, understand that if you don't buy, you very well will be nibbled to death in rent increases where you have no choice to move away. This choice isn't great either, but again, its all about self awareness IMO.

He's right, just any guy. You are taking a greater risk by waiting for a crash, and not buying now.

somecrappynumber says

My gardener did. He bought a house with no money down, stayed free for more than 2 years before they kicked him out. Lucky bastard.

If the 2005 buyer could afford it, in most places he is above water now. And he is now 12 years into his note - 18 years til being payment fee and eating through principal at a very fast rate. I'm sure the first years of worry sucked, but he would much rather be where he is now than having rented for 12 years and NOW thinking about starting that 30 year clock to freedom.

Even buying at the worst possible time and holding on to the property, works out better than not buying at all.

somecrappynumber says

very few people who rent for 40-50 or 60 years would call a mere 30 year payment term "slavery"

Sorry, to be clear I don't consider rent slavery, because it doesn't involve debt and it's much easier to leave a rental than a house you still owe on.

NuttBoxer says

Sorry, to be clear I don't consider rent slavery, because it doesn't involve debt and it's much easier to leave a rental than a house you still owe on.

The slavery analogy is ridiculous. You have to pay for housing whether you rent or buy.

Renting does offer more flexibility, but almost always costs more over longer time frames.

The only people who aren't "slaves" are the guys who read patnet between shits at the public library before they go back to their mattress under The highway overpass.

joeyjojojunior says

Renting does offer more flexibility, but almost always costs more over longer time frames.

It hasn't caught up to me until year 16. I've only started paying something close to a mortgage this past year.

NuttBoxer says

It hasn't caught up to me until year 16. I've only started paying something close to a mortgage this past year.

I have zero problem with renting, so not trying to give you a hard time. But roughly, what would you say the percentage is you pay renting under having a similar house and mortgage? I'll try and dig something up, but I just feel like the parity between rent prices and mortgage costs over time really is not that big of a discrepancy. And if you already itemize on your taxes, without the interest and taxes of ownership, I have a hard time believing that renting is better. That saving of X dollars at the top of you income is substantial if you're making more than $150k as a family. Every $10k of income above $150k would be roughly $2,500 to $2,800 saved as you transition to the 28% bracket.

Mind you renting is likely better for a lot of people because of the time lived in a location. I've finally settled and been in the same house for four years (owning) but previously was moving every 2-3 years. We rented and that most certainly worked out. Right now though, where I'm located, I would have a hard time finding a rental that is cheaper then owning the debt. And even then, for my situation, the rental would have to be about 35% cheaper then the mortgage for me to rent again. Again, not happening in my area.

NuttBoxer says

It hasn't caught up to me until year 16. I've only started paying something close to a mortgage this past year

Yes, I think it's most likely a case of you not comparing apples to apples when doing buy vs. rent and/or not accounting for the fact that principal should be subtracted out of a mortgage payment for comparison purposes.

I was speaking simply from a monthly payment perspective. I didn't factor in the ownership costs of time, repairs, taxes, or down. If I was going to compare the rent I started paying this year to a mortgage I could get if I bought this year, I would still be doing better than owning.

As far as stability of ownership, yes, it takes longer to move when you want to, but no, renting does not mean you have to move every few years. I know people who have rented the same place for 20 years. We have moved fairly often, but that has more to do with a sickness than renting. We like looking at new places, but the worse part of deciding to move just because we can is passing.

NuttBoxer says

I was speaking simply from a monthly payment perspective

Yes, clearly if you do the calculation incorrectly, renting may appear to be cheaper over any timeframe

NuttBoxer says

As far as stability of ownership, yes, it takes longer to move when you want to, but no, renting does not mean you have to move every few years. I know people who have rented the same place for 20 years.

So what. I heard of a tenant being forced to move within 24 hours. The idiot threw a party on the first evening and all the neighbors complained.
Renting can never work out better than owning in California over any 10 year period, and never will in our lifetime.
The stock market can work out better over time if you won't be taking a mortgage, and plan on paying all cash. If you are gonna take a mortgage, the benefits of appreciation, tax benefits, and leverage will far outweigh the returns on the stock market. That's just the way it is.

NuttBoxer says

If I was going to compare the rent I started paying this year to a mortgage I could get if I bought this year, I would still be doing better than owning.

I still don't buy this. Markets are local, but I believe from past posts, you're on the West coast. Where are you renting that is so substantially cheaper then having a mortgage? There are bubbles for sure, but a 30% difference in rent vs. mortgage payment is pretty hard to come by in any area unless a landlord is just straight up lazy.

Rents are ultimately tied in some form or another to what people would pay for a mortgage. The smart landlord is going to push that as close to what a mortgage would be as they can. And in certain markets they even go over the cost of a mortgage. In a high COLA renting really doesn't make sense except for mobility.

WookieMan says

NuttBoxer says

If I was going to compare the rent I started paying this year to a mortgage I could get if I bought this year, I would still be doing better than owning.

Rents are ultimately tied in some form or another to what people would pay for a mortgage.

This is strongly correlated to home price.

In the Bay Area, high end affluent areas can have as low an annual rent:price ratio as 3% and in less affluent areas as high as 10%.