Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Just because you think the value of X is worth $X doesn't mean that makes it so. Like I said, the price of any commodity including homes is based on supply and demand.
I do agree with tickyul that the government is totally interfering with true market forces and that is artificially holding prices up. But also from being a realtor you should know the 3 most important things in real estate are location, location, location. You have a house like that in La Jolla that is move in ready and you are going to get a whole heck of a lot more than $900,000 for it. It doesn't matter that it's a lot of money or not. Supply and demand. I would have bought it for $900,000 and I probably have 150+ clients that would have as well. And you can't use the argument of government interference or low mortgage rates or whatever because we all could have paid cash for it.
It also really depends on who the buyer is and what that person is willing to pay. Many don't think the home was worth $1.4 million but someone obviously did otherwise it wouldn't have sold for that. There are intangibles for any sale, especially with finding the right buyer. No matter how hard we try, we cannot completely estimate the "it's the one" factor from the right buyer. The seller can always command a premium price relative to market from the "it's the one" buyer. The seller just needs to find that buyer. Some do and some don't, but in this case I'd say the seller did.
I don't buy into the "true value" argument. There are many, many products where "true value" is determined by intangibles such as status, brand cachet, etc. Luxury products in particular fall into this category. This is the same for housing Del Mar
This is a very informative thread, definitely one of the best in the San Diego section. My family and I are moving from Hong Kong at the end of the month, and are looking to buy in North County within the next 4-6 months. We have seen significant softening of prices in the last 18 months, but in desirable areas, the drop is not as pronounced. We are also in the 700-1M range, and there seem to be many suitable properties, including some in neighborhoods we never thought would be possible previously. Also, as some of you seem to be quite in tune with the local markets, please give me your ideas on commercial properties, specifically multi-family residential. We would like to purchase a 8-12 unit complex in the next year, and if anyone has a good resource for us to get started, it would be much appreciated.
This is a very informative thread, definitely one of the best in the San Diego section. My family and I are moving from Hong Kong at the end of the month, and are looking to buy in North County within the next 4-6 months. We have seen significant softening of prices in the last 18 months, but in desirable areas, the drop is not as pronounced. We are also in the 700-1M range, and there seem to be many suitable properties, including some in neighborhoods we never thought would be possible previously. Also, as some of you seem to be quite in tune with the local markets, please give me your ideas on commercial properties, specifically multi-family residential. We would like to purchase a 8-12 unit complex in the next year, and if anyone has a good resource for us to get started, it would be much appreciated.
an 8-12 unit complex in what range? Target market? POint is, slum lord with potentially higher returns or area that has a steady flow of renters in a desirable area with fairly low returns?
There are a few websites that have some calculations of rentals within a given area (eg zip code) but cant remember what it is. Or you punch in the address and it gives you a median rental price estimate for said area. Anyone remember?
This is a very informative thread, definitely one of the best in the San Diego section. My family and I are moving from Hong Kong at the end of the month, and are looking to buy in North County within the next 4-6 months. We have seen significant softening of prices in the last 18 months, but in desirable areas, the drop is not as pronounced. We are also in the 700-1M range, and there seem to be many suitable properties, including some in neighborhoods we never thought would be possible previously. Also, as some of you seem to be quite in tune with the local markets, please give me your ideas on commercial properties, specifically multi-family residential. We would like to purchase a 8-12 unit complex in the next year, and if anyone has a good resource for us to get started, it would be much appreciated.
Do not buy -unless you plan to live there forever. Forever=ok
anything less you will get demolished.
As far as a 8-12 unit complex , I would look elsewhere. There are tremendous value is these type units in The south Florida area -where the pricing has already bottomed or close to it(it got creamed, so cal multi units have a long way to go still)
I have a buddy thats been picking these type units up in FLA for 20k per unit average(1 bedrooms) and renting them for 600
it is a awesome cash flow and ROI.
If you figure out the ROI on these types of units in coastal calif- it will be like standing on top of a building and throwing your money off it(Inland Empire is managable though right now)
Moderator cut: advertising is not permitted, and no links for users under 50 posts
Real Estate,Tulips and the Extraordinary Popular Delusions & the Madness of Crowds
Last edited by thepinksquid; 10-14-2011 at 09:36 PM..
Reason: advertising is not permitted, and no links for users under 50 posts
Do not buy -unless you plan to live there forever. Forever=ok
anything less you will get demolished.
As far as a 8-12 unit complex , I would look elsewhere. There are tremendous value is these type units in The south Florida area -where the pricing has already bottomed or close to it(it got creamed, so cal multi units have a long way to go still)
I have a buddy thats been picking these type units up in FLA for 20k per unit average(1 bedrooms) and renting them for 600
it is a awesome cash flow and ROI.
If you figure out the ROI on these types of units in coastal calif- it will be like standing on top of a building and throwing your money off it(Inland Empire is managable though right now)
Do have a agenda or something?
Trying to plug a new Blog or Book?
San Diego is over priced and hasn't hit bottom Blah! Blah! Blah!
We Get it Dude!
But what you don't seem to realize,or choose to ignore is people are willing to pay a little extra for peace,beach and sunshine.
Some of the smartest people on this forum have chimed in and agreed with some of your views.
But you seem to disregard or ignore their views!
Why?
I dont think Ive ignored anyones views. And whose to say if they are smart or if you or I am smart?
I am just very opinionated about this subject. I Know people are willing to pay more for the ameneties. Most would. I know I would. Some of my opinions are just that- opinions. may be wrong or they may be right. As are yours Hitman.
I guess the thing that gets to me is the "Its different here" themes that many people and especially real estate agents tend to portray in mainly the upper end beach towns in the Southern California area.
History has shown how these situations pan out. There is not a area in the world where pricing bubbled into a new plateau and pricing remained at that new level. Of course some of these situations do take many years to correct but they will correct to the annualized inflation rate plus or minus a small amount. wait till you see what happens in China -it will make our housing crisis seem like small potatoes. (on a smaller note watch Brazil and Australia)
Im moving to San diego shortly with my family. I am opening a real estate office shortly there too. I have my sailboat docked at harbor island for a few years now. Yes I do love the area. and many others do too.
with all that said- what is going on there is unsustainable.
interest rates at historic lows and sales of homes in San Diego are still very low with pricing flat to slightly falling. Whats going to happen when rates get back up into the still low 6% range? and how about 7-8 % ? its going to be interesting - thats for sure.
Moderator cut: advertising is not permitted, and no links for users under 50 posts
Last edited by thepinksquid; 10-14-2011 at 09:35 PM..
Reason: advertising is not permitted, and no links for users under 50 posts
I would prefer something in a firm middle-class area, with a strong rental demand. We are going to be managing the complex ourselves, so I would prefer not to become a slum lord. I have owned several properties overseas, but must admit ignorance to the dynamics of southern CA. We are going to be living in the area long-term, which is why I'm interested in rental properties there. I understand the strong yield potentials in FL, but I am back and forth to Asia monthly, and don't have the time or inclination to manage properties elsewhere. Our budget is something around 1M, and I wouldn't mind stepping into existing financing with $100K down or something similar, if the net returns were suitable. It seems like a couple of you are already going down this road, so your input would really be helpful. Thanks for the responses.
just out of curiosity, can you get a 1mil place with only $100,000 down? Is the down payment structure different on multi unit dwellings? I am thinking something near one of the universities would assure regular income, but probably lots of wear and tear too.
just out of curiosity, can you get a 1mil place with only $100,000 down? Is the down payment structure different on multi unit dwellings? I am thinking something near one of the universities would assure regular income, but probably lots of wear and tear too.
I seriously doubt it. Most lenders have gotten more difficult and down payments I believe are averaging closer to 20+% down with excellent credit. Typically multi-unit buildings are tougher to finance vs. buying a residential primary residence to live in. I have a client in Sacramento and he is buying multi unit buildings but he is paying in cash and buying them off the courthouse steps for very cheap. He planned to flip them but he told me the ROI is so good he is now keeping them. He claims the ROI was something astronomical like 18% a year so it doesn't make sense to flip it. I know in areas like Sacramento you have TONS of opportunities to pick up multi unit buildings for $1 million or slightly more. But I'm not so sure many of these opportunities exist in San Diego.
Also, I think the biggest problem you're going to have is trying to find multi unit buildings in great areas for only $1 million. The stuff near most of the universities here I'm sure are not cheap.
I have seen online some cheaper properties in some lower end parts of Chula Vista for as low as $140,000 each so I guess you could buy a few of those types of units. But most of those cheaper properties in distress seem like cash buyers are buying them up. And I'm not sure of the quality of tenants renting in those areas.
I own several rental properties overseas and whether it's overseas or here in the USA...the most important thing is having an excellent and trustworthy property manager. Without that...it's a whole lot of trouble and problems.
My strategy has always been to buy in the best and most desirable neighborhoods. Of course it's much more expensive doing this but I've found location, location, location truly are the 3 most important things in real estate. I've never had a tough time renting them out and always have gotten quality tenants. Plus even in times of recession, the values have held up very well and I get all kinds of unsolicited offers to purchase them.
I know some people go with the opposite strategy and buy things in cheaper areas. Buying in the best areas here in San Diego will cost you a small fortune. Some others are buying dumpier places in dumpier areas but apparently still making decent cash flow. Here is one a realtor sent me. I have no idea how the neighborhood is but I assume a bit rough. http://www.redfin.com/CA/Chula-Vista...1/home/6133054 I just talked to my lawyer and best friend last week and one of his buddies is buying up dumpy properties in New Mexico for SUPER cheap, spending a small amount to fix them up and then turning around and getting good returns renting them out. I'm not sure if he is managing them himself.... Managing properties is NOT fun if you don't know what you're doing..
Last edited by earlyretirement; 10-19-2011 at 06:28 PM..
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
no real agenda-just some strong opinions
