Another bubble? (San Diego: sales, 2013, rental)

[malcorub16]

I had him pegged for a family guy since he was looking in RB, RP, and Scripps...and was also willing to accept Eastlake. OP, since there are only two of you, the options are much bigger than just the family burbs. Are you coming out to retire or will you work somewhere?

[Jhox99]

EarlyRetirement- Oh absolutely-those three are much more conservative than what we had seen on our trip. Below is one in RP, not quite 700k, but I was still shocked that it was 650k. (I have to remember, though, that I approach this from a locale where the below home would value around $250k.) However, I did just notice that it has no HOA or Mello Roos, so I'm not sure how much value that adds.
9156 Oviedo St, San Diego, CA 92129 is For Sale - Zillow

Hitman-Definitely. At least 9 months in a rental. But, realistically, more like a couple years. We have enough for a solid downpayment on a home, but I would still like to save a bit more.

What I don't want to happen is to start ignoring retirement savings, so however long it takes to save for downpayment while continuing to stash away long-term funds is what will decide when and how much house to buy.

[Jhox99]

Malco, we are coming to work! Obviously, job location will be the primary factor in what area to look in. In October, we came out to get a feel for all the areas we have never seen. It's crazy, I have now been to San Diego 7 times since 2008, but I feel like I stayed on the coast for the previous 6. So we explored east county a bit and the south bay area as well as that 15 corridor near RP, RB, Poway, etc.

We will start to look for jobs in March and hopefully have something by June. It's a bit of a sticky situation. My wife works on yearly contracts at her school. So if neither of us have a job in San Diego by July, we will have a tough decision to make. But I feel like we are both fairly marketable (master's degrees and good experience). We have a very comfortable living here, but we expect to be significantly humbled in San Diego. With these rapidly increasing home prices (to get back on thread topic), I can now assure myself that we will be even more humbled than I am even planning for!

[thelopez2]

I was just thinking even if you found a bargain would you be in a position to buy considering your lack of employment history? Do you expect your income to increase with your new jobs here? You make a pretty comfortable living now, have you consider buying a smaller second home/condo in SD , let someone else pay the interest while you pay down principal? Do you own your home now?

[NYSD1995]

Originally Posted by rgb123

Is it common to have bars on the doors/windows in nicer areas?

Not really, but in the 80s a lot of seniors put the cages up and never took them down.

[Jhox99]

thelopez, you mean lack of employment history in San Diego? I would expect I will receive a significant bump in salary, having just finished my MBA and with enough experience that I will be ready to take a step up. However, she will only receive a modest increase (maybe $5k-that is, if she is able to land a counseling job in a school-if she switches to private practice, her salary could be much more). Conservatively, we could expect to be around $110k/yr although I wouldn't be surprised if I am selling myself short and we end up around $120k.

We don't own a home currently. We just sold ours in June in preparation for the move. We actually bought it in 2011 with the expectation that it would help pay our way to San Diego-risky, but that is exactly what happened. We fixed it up, made some money off of the hot sellers' market and now have to pay the piper on the buyers' side in California (in a couple years).

[earlyretirement]

Originally Posted by Jhox99

EarlyRetirement- Oh absolutely-those three are much more conservative than what we had seen on our trip. Below is one in RP, not quite 700k, but I was still shocked that it was 650k. (I have to remember, though, that I approach this from a locale where the below home would value around $250k.) However, I did just notice that it has no HOA or Mello Roos, so I'm not sure how much value that adds.
9156 Oviedo St, San Diego, CA 92129 is For Sale - Zillow

Hitman-Definitely. At least 9 months in a rental. But, realistically, more like a couple years. We have enough for a solid downpayment on a home, but I would still like to save a bit more.

What I don't want to happen is to start ignoring retirement savings, so however long it takes to save for downpayment while continuing to stash away long-term funds is what will decide when and how much house to buy.

Thanks jhox99 for taking the time to post back and answer questions. It is really helpful and I'm sure it is for other future people in your similar situation.

Absolutely many people are surprised by home prices here just like you are. Many "nothing special" houses here that are $650k + would be maybe 1/3 of that price or less in other cities. I see it all the time with people relocating here from other cheaper places. The problem with many of them is they don't want to 'settle' for a lower end house compared to the city where they are moving from and many of them end up buying a house they can't really afford so they are behind the 8 ball from the beginning.

I remember when we moved here a few years ago, we met people that moved here from other areas and in a fairly short amount of time they were struggling as they bought too much home vs. their income. And you are VERY wise to worry about retirement savings. Make that a priority as it's important.

That area over on Oviedo is nice. That's a nice area, especially if you are raising kids.

[tonyinsd]

No, it's not a bubble. You don't have the factors that caused the last bubble to inflate -- liar loans, people getting loans for more than they could ever dream of paying back, interest only loans, and the like.

The last few years were very abnormal due to so many people dumping their houses because they got in over their heads. Now we're returning to something more like normal. It's just that we're so far off the bottom, which was abnormally low, that it seems like a huge run up.

We're still below prices from the peak.

[1AngryTaxPayer]

Originally Posted by Sassberto

Not really, but in the 80s a lot of seniors put the cages up and never took them down.

Wasn't that tweeker-mania that caused that? I know it was in squaremont.

[Red Chili]

I'm not sure if it's a bubble but there are many "flips" on the market. We are looking to buy in north county. I like redfin, and looking at the pricing history. Many homes were last sold only a few months ago yet are asking 50-75k more. You can usually tell it's a flip in the pictures with the staged furniture. Good for the flippers, sucks for us lol!