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PodPoet
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| 09/16/2007 9:52 AM |
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| Well the main thing the previous poster neglects to mention is the tax advantage of owning rather than renting. Renting is good for some people, buying is better for others. Also my friend is a government worker so he gets to retire at 55 with a $70,000/year pension and free medical care for the rest of his life beyond 55, so I think he's pretty set for a good retirement. His condo's value will be icing on the cake. |
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Anonymous
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| 09/16/2007 11:10 AM |
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PodPoet, even after tax benefits, there's a big difference between rental and debt service + property taxes + HOA. If you invest the difference and buy at the bottom, you come out way, way ahead.
If your friend to sits down and puts in on a spreadsheet, he'll be shocked at the money he would have saved by NOT buying at the peak. I'm sure he won't do it, because the truth is too painful. If he doesn't know how to use a spreadsheet, then he needs to hang out with friends who can give him better advice. You're not doing your friend much favor buy giving him wrong information. If you can't give good, accurate advice, then you should stay quiet.
I have many friends who are in denial about their homes also. So I never talk real estate or money with them. I talk about the weather and the lastest movie.
You can live in denial if you want, but the numbers are what they are.
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PodPoet
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| 09/16/2007 12:02 PM |
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| Well my friend bought pre-construction so he got a good deal, lower than the 'height of the market' prices, so I doubt any of the bidders at the auction will get a place as nice as his for what he paid. But I guess we'll know that after the auction. Actually he just told me that the prime units in the building (corner units, top floor, killer views) all sold out pre-construction from people who saw a good thing and got in before they jacked up the prices, so I guess the bidders can get fairly nice units but not quite as nice as those who bought pre-construction. |
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Anonymous
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| 09/16/2007 12:24 PM |
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The way tax deductions work is that you have to spend $1.00 to save 30c. Net expense = 70c. Which would you rather have-- zero expenses or the expense less tax savings?
Yes, let's see the results of the auction in a few weeks. Are you bidding, PodPoet, since you think that La Boheme is such a good deal?
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PodPoet
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| 09/16/2007 12:54 PM |
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| No I'm not bidding because I already own a place in North Park. But I'm looking forward to more homeowners moving into La Boheme, because normally a neighborhood improves as the number of homeowners increases and the number of renters decreases. Homeowners by definition typically look after, care for and show more pride in their properties than renters. So I think it's good the La Boheme units are being auctioned to buyers rather than turned into rentals. That will help property prices in the area. |
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Frenchy
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| 09/16/2007 1:06 PM |
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| PodPoet what make you think that those who are going to bid at the auctions are not going to rent out the units they buy. If they are auctioned off cheap enough you can bet that many will be rentals |
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PodPoet
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| 09/16/2007 1:17 PM |
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| Well as soon as the developer leaves the HOA Board the homeowners at La Boheme will be instituting a 2-5-year occupancy clause, like at many condo complexes, requiring homeonwer occupancy for at least that long before allowing any unit to be rented out. My friend there says they already have a majority of homeowners agreeing to that. That kind of move helps protect everyone's investment. |
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Anonymous
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| 09/16/2007 1:32 PM |
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Such occupancy clauses are not enforceable because they are illegal and unenforceable. The HOA can try but they be spending good money on lawyers in vain.
Those clauses amount to taking away property rights (by limiting what an owner can do with their properties) without proper compensation. They courts never enforce those clauses.
There was a court precedent (don't remember the exact case). Although developers like to include such clauses in their sales agreements, the flippers/investors know that they cannot be enforced. They would flip or rent their properties nothwithstanding the occupancy clauses.
Those clauses are only to reassure the idiots who don't know any better. The true investors are smarter than that.
Co-ops like they have in New York are the best way of controlling ownership and keeping the riff-raffs out of buildings.
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Newbie
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| 09/16/2007 1:36 PM |
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| Lots of condo complexes downtown and elsewhwere don't allow willy-nilly renting of their condos by owners. Guess those places never had problems enforcing those clauses. |
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WTF
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| 09/16/2007 4:36 PM |
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| Are you guys stoned. Developers today do not care if they are going to get rented out, they just want somebody to buy their depreciating assets. They would be so lucky to sell a few... |
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Anonymous
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| 09/16/2007 5:12 PM |
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Some people who don't know are afraid to rent out their units against the occupancy clause. But there's nothing the developer or HOA can do about it if you choose to flip or rent out your condo. If you don't believe me, spend some money and ask a real estate lawyer. I flip a condo againts such "agreement" and no one even contacted me.
Like it always is the case, only the idiots get reeled in.
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newbie
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| 09/16/2007 8:07 PM |
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| Well the La Boheme units would have to sell at their starting bids or not much higher (which is highly unlikely) to make it worth a buyer's effort to rent them out, since the HOA fees are relatively high, so it would be hard to get back in rent much more than what you would be paying as owner of the place. That alone should keep the owner vs. renters mix more in favor of the owners. |
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Anonymous
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| 09/16/2007 10:47 PM |
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Hi Folks - checked out La Boheme myself today and I have two comments
1) The auction company they use is owned by LandAuction.com. They are very good at getting amateurs to part with the their money. However, at the right price, these units would be a good deal
2) The auction prices they list (and is a basis for the 50% starting bid is somewhat inaccurate, in my opinion).
The use the words "previously valued to" to set the illusion of market price. These values are not based on today's market conditions. Yours truly has access to a price list dated 7/31/07, when DR Horton was still selling the units.
For example (from the auction catalog)
http://www.redchomeauction.com/auction_details.php?auctionID=D-003
Lot # 1106 in auction has a value of $319,990 but DR Horton last tried to sell this unit at $279,990
Lot #1213 in auction has a value of $539,900 but DR Horton tried to sell the unit a $432,990
Lot #2214 is listed as valued as $385,990 but DR Horton tried to sell the unit at $385,990
Get the point here. The market value prices/comparable values are wrong. Buyer beware .......
V
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Anonymous
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| 09/17/2007 12:32 AM |
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Correction on lot # 2214 - Auction catalog lists value as $443,990, previously listed by DR Horton at $385,990
V
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Anonymous
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| 09/17/2007 8:19 AM |
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Thanks for telling us about this overstated values and the auction gimmicks.
I was thinking about bidding but I'll skip the auction because I'll be a waste of time. I'm willing to pay cash for a 1/1 but only at $150k. I'll just wait a few more years for the market to come down some more.
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BBQ Bert
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| 09/17/2007 8:32 AM |
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| Do not be a sucker and attend these phoney auctions the starting prices are still way to high.Plus the owners are going to be planting their own shills at these auctions to keep the prices high.Better to wait it out and let DR Horton eat their shorts and then be forced into slashing there prices and giving away some true discounts. |
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Anonymous
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| 09/17/2007 9:17 AM |
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| They also have undisclosed reserve prices so the minimum is not the true minimum. They are just trying to sell by creating excitmennt. Only the suckers will get taken -- to the cleaners. |
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Anonymous
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| 09/17/2007 10:21 AM |
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| Knowledge is power. Assuming you could get a good deal - a unit close to starting prices would be good - but I doubt it will happen. I will try to get the price sheets on line tomorrow |
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Mr. Fun
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| 09/17/2007 10:24 AM |
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La Boheme units are already appearing for rent. Do a quick search on craigslist to turn up several:
"Chic" North Park? You can't walk to the mailbox without pepper spray!
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$1150 / 1br - Open House Sun. 2:00-4:00! La Boheme! Chic North Park! New Condo! NICE
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Reply to: Andrea4SD@aol.com
Date: 2007-09-14, 9:41AM PDT
Open House Sunday 2:00-4:00! GO TO 30th STREET ENTRY & CALL ANDREA FOR ENTRY INTO SECURE BUILDING. $1150.00. AVAILABLE NOW!! 9 months new condo. 1 bedroom beauty! ADDRESS: 3857 30th Street #406 San Diego, CA 92104. Condo is in the brand new La Boheme Condos. 700 sq. ft. Secure building with underground parking, a full gym and spa. La Boheme is in the heart of fashionable North Park |
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Anon
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| 09/17/2007 12:24 PM |
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| Why not wait for the real bargains that will come soon enough? http://piggington.com/sunday_foreclosure_chart_extravaganza |
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