OCtoSV said:
USCTrojanCPA said:
The California Court Company said:
there is a difference between primary and investment properties. if a house that is exactly what you are looking for, and you can afford it, plan to stay it long term (forever home for Calbears and unicorn for USC) it really doesn't matter if you overpay it by 10 or 20%.....you only live it once.
USCTrojanCPA said:
OCtoSV said:
Is anyone but CalBruin or USC purchasing right now? I personally pulled back from levering up to get a unicorn property months ago based on how I read the tea leaves but I?m conservative by nature and support a family on my earnings and am well into a 1.99 15 yr. My equity portfolio seems to have priced in the looming stagflation but I feel that pain is still to come in residential real estate pricing, and given none of us have lived the bursting of a 40 yr bond bubble I fear the decline will be slow and long.
There's a lot more people than just CalBear and I who bought. I bought because the property that I purchased only comes around once every few years (at least for me) and I don't care what prices will do in 1, 2, 3, 5, or even 10 years as this is house is it for me. Also, I have about 8 years in liquid reserves to cover payments for all my properties (including assuming my rentals don't generate rental income) so may be more risk tolerant than most but I also do it when I can I can financially manage the additional financial burden.
Bingo, the most valuable asset in life is time.
Recall my prediction is close to a 40% hit, and I'm very sure we'll see that, especially above $2M, especially in OC without the organic high paying job base. I am very confident rates will now pass 8% as the Fed is intent on deterring purchases at current pricing levels, and a crapload of boomers all across the 15M+ population SoCal area are going to be panicked sellers over the next 1-2 years as they try to get themselves out of CA. Boomers and job losses, especially in FIRE as SG pointed out, will drive the inventory.
It would eat at me if I overpayed by 20%, let alone 40%.
I'm quite confident that your prediction about 40% drop is completely wrong. Also, I bought at the end of 2021, so I didn't really overpay that much. Housing price has gone up about 20% since I bought. I don't think housing price will drop more than 20%, which means it will just drop back to what I paid.
But the most important thing, as CV and Martin already said, this is my primary residence, and forever home at that, so I don't care even if it does drop 40%, meaning I overpaid by 20%.
This may not be the unicorn home, but it checked out almost all the boxes we desired: new construction (a
MUST for my wife), location (unlike some TI'ers, we
love PS), floorplan (we love IP's cookie cutter floorplan ;D). And it has a good size lot too, unlike most of the homes in Irvine.
The only box that didn't check for me is the lack of driveway, but it's not that important to my wife. Personally, I would have prefer Highland, which checked out two more boxes for me, driveway and NO parking on the street. I'm probably the only person in the world who likes the idea of no parking on the street. ;D Unfortunately, the Highland home that we would have got would come with extremely small lot. So we decided on the bigger lot (plus some privacy) over driveway.
The main driving factor for us is that there aren't many new construction left in Irvine. We don't like Great Park, so that only leaves PS and OH. PS will be built out soon and OH is going to be too expensive for us, so we can't wait. And, of course, if we don't buy in Irvine, we can't sell our Eastvale home either, so if a drop is coming, that one will most likely drop even more.
