irvinehomeowner said:
Not to you specifically but to anyone who thinks waiting would have been better than buying in 2016, last year or now. Posters like eyephone are giving advice to other members that they should wait because there will be a "slowdown" in pricing but how significant will those savings be?
I understand waiting for a home with a better location or floorplan, but to wait for a 5% (or 10%) drop in price doesn't seem to be that much of a savings compared to the stress of waiting and the question marks about where you will live.
I've been lucky to buy at a low point twice, but I also bought at a very high point and a middle point... and in the end, any time works out as long as you can afford it because if you purchase a good product in a high value area with demand, your losses will be minimal in case you need to sell and will have a good return after 5-10 years if you need to move up.
So when people say "buy now or be priced out"... I actually think that's marginally good advice (with the caveat of affordability) because it's better to be in and building equity rather than just hoping you guess the right lotto numbers and got into escrow on the one bargain everyone else is waiting for.
Just my opinion.
IHO, it isn?t just about waiting for the price to come down. Irvine rent is so absurdly low, it makes financial sense to wait.
I recently talked my cousin out of buying ($1 million home with 20% down) in Delano in Eastwood because we broke down the numbers for the cost to own vs rent. It made too much financial sense to rent. It would cost about $5000 / month to own when we added up HOA, property tax, mello roos, insurance, and interest portion on his mortgage. (not counting principal) On top of that, his $200k down payment would just sit there getting 0 return, waiting to capture future appreciation.
He rented the same home for $3550 / month. He can drive down the cost to rent to about $3000 / month If he just invested his $200k down payment into something very safe and low risk like a 3% CD for 5 years. In 5 years, he would have saved over $120k by renting.
How much appreciation are you predicting in the next 5 years for buying to make financial sense? Are you taking into consideration the 4-6% transaction cost when selling in 5 years?
