Why would you buy a home here in Ca? (Los Angeles: real estate, house)

[CLQ]

Trust me...ask the surfers if they get sick. I know for a fact the water is dirty. A family member used to work for Orange County and his job was to test the water, I won't go into details on what he found in the water besides fecal matter. Go to San Diego beaches they are much cleaner. Both Pacific Ocean, same seaweed, etc. Also, just look at the film sitting on top of the water. Maybe it is not enough to get everyone sick but to say it isn't dirty is just naive.

[CLQ]

Originally Posted by greggd

Those $500,000 junkers are taking the biggest hit right now. So to answer your question, I would buy it and rent it out. Rental prices have been increasing.

A couple years might it might make sense to buy but not now on a down market . The prices will decrease into 2008 and 2009 when the majority of the ARMs reset and foreclosures will be sitting for too long and must drop. It is definitely not the right time to buy in LA if you are a first-time homebuyer and not a trust fund kid although I wish I was.

[greggd]

Originally Posted by CLQ

Trust me...ask the surfers if they get sick. I know for a fact the water is dirty. A family member used to work for Orange County and his job was to test the water, I won't go into details on what he found in the water besides fecal matter. Go to San Diego beaches they are much cleaner. Both Pacific Ocean, same seaweed, etc. Also, just look at the film sitting on top of the water. Maybe it is not enough to get everyone sick but to say it isn't dirty is just naive.

Thanks,

SD has there problems too with water quality.

Like I said I'm in the water 2 & sometimes 3 times a week and I'm not getting sick. If everyone using the ocean became Ill, I think I would be aware of it. As a matter of fact, I was out this Saturday at El Porto.

Im not saying the water is pristine, Im just saying its not going to cause constant illness. Maybe your right though, Ive been here all my life, I may have built up some degree of immunity.

[greggd]

Originally Posted by CLQ

A couple years might it might make sense to buy but not now on a down market . The prices will decrease into 2008 and 2009 when the majority of the ARMs reset and foreclosures will be sitting for too long and must drop. It is definitely not the right time to buy in LA if you are a first-time homebuyer and not a trust fund kid although I wish I was.

Hi,

I wouldnt buy right now either, but a $500,000 home = rental/income property to me or teardowna and conversion to a 4 unit if so zoned. Rents will increase across the board in my opinion, especially in the nicer areas of town. A fixer at $500,000 in a developing area may be a good deal. But yes, waiting until next year would be my theory as well.

[CLQ]

Originally Posted by greggd

Hi,

I wouldnt buy right now either, but a $500,000 home = rental/income property to me or teardowna and conversion to a 4 unit if so zoned. Rents will increase across the board in my opinion, especially in the nicer areas of town. A fixer at $500,000 in a developing area may be a good deal. But yes, waiting until next year would be my theory as well.

I always wondered who buys these homes over $500K and tears them down immediately and rebuilds. It is not the typical household income even in the six figures. I'm not too sure if rentals will increase too much since owners will not be selling and rather putting up their place for rent which will increase the supply. Also as prices drop, renters will buy and there will be even more supply. The one thing that can lead to the increase would be the stringent lending policies put in place forcing people to rent who can no longer qualify for a mortgage. Also, I don't think there would be positive cash flow on a $500K home and no equity since prices are going down so I don't think it makes sense. There are other markets across US that are still growing so for investing purposes I would seek elsewhere.

[greggd]

Originally Posted by CLQ

I always wondered who buys these homes over $500K and tears them down immediately and rebuilds. It is not the typical household income even in the six figures. I'm not too sure if rentals will increase too much since owners will not be selling and rather putting up their place for rent which will increase the supply. Also as prices drop, renters will buy and there will be even more supply. The one thing that can lead to the increase would be the stringent lending policies put in place forcing people to rent who can no longer qualify for a mortgage. Also, I don't think there would be positive cash flow on a $500K home and no equity since prices are going down so I don't think it makes sense. There are other markets across US that are still growing so for investing purposes I would seek elsewhere.

You have take the rental property on a case by case basis. Also, keep in mind that buying a rental means putting minimum 20% down.

[CLQ]

Originally Posted by greggd

You have take the rental property on a case by case basis. Also, keep in mind that buying a rental means putting minimum 20% down.

It's still not worth it. Show me the numbers. Put together a proforma and consider the down market. High negative monthly cash flow and a loss on the sale. LA is not a good investment right now period...maybe in 2-3 years when the peak drops to adjust to normal appreciation. Also, the typical household in LA doesn't have over $100K sitting around in cash for a 20% down and it doesn't always make sense to give cash to the lenders when you can have it growing elsewhere.

[monti]

Why would you buy a home ANYWHERE? For some false sense of stability and accomplishment - where, in many places the equity can barely keep up with inflation?

No thanks.

[california_guy110]

Some people value where they live over having a nice house, its as simple as that, I don't get why some people don't understand this, I'd rather live in a tiny apartment in California near the beach then live in Minnesota or some other place where it snows for 6 months out of the year.. for some people their house is just where they sleep at night.

[california_guy110]

Originally Posted by Californialeavin

I predict California will be bankrupt in 10 years- face the facts and get out NOW while you still have a chance to make a good life for yourself, and your family...

What does this mean? California has the biggest economy of any state in the U.S., how can a state go bankrupt, that is an ignorant statement.