***UPDATE*** Closing on Jan 15, 2008 - Savannah

NEW -> Contingent Buyer Assistance Program
I think the thing that would give me the most pause is the strong possibility that if you wait at least one year you will get a lot more home for your money than you will today. As far as Daedalus's comments, I agree, for me being able to escape my shared walls, noisy neighbors and crappy parking for an SFR would be worth paying a premium for. But correct me if I'm wrong here but Jbatzmuro's deal is for a condo.



I suppose you need to ask yourself if the bear's predictions come true and prices drop another 20% in the next 1 to 1.5 years will

you regret having moved forward with this deal. To me losing 5k would not keep me from walking on a deal if it meant that I could get

a lot more home for the equalent cost by simply waiting a little longer. I would rent a nicer apt to keep the wife happy and watch as prices continue to drop. Just my 2 cents.
 
awgee has a good point... i would hate to be 100k under. but if it is a little under then i am ok...

jim jones has a good point... i would be piss if the SFR for a huntington beach or irvine will cost only 250k or 350k. because i would be able to afford one. but to be honest.... i don't see those house dropping that much.... maybe santa ana or corona.



RTLGURU did you buy the one in lantana? those are really nice.... if all the bear is correct, i will be able to pay cash for one of those in 10 years 350k.





once again thank you for all the advice....
 
<i>"Awgee, did you not find some comfort knowing that you weren't paying rent? You were losing equity, but how much was the 25% paper loss compared to the rent you would have paid over 3 years?"</i><p>




Daedalus - I could have rented the same house for less than I was paying in interest on the mortgage payment. And I could have invested the 20% instead of watching it melt away. And bought later for <b>ALOT</b> less. No, I did not find comfort paying on a mortgage that was more than my house was worth. I am experienceing much more confort now renting for much less than I would pay in mortgage, watching my net worth increase instead of decrease and watch the market trend show me that the next time I will be able to buy a home of greater value for cash. <b>NOW THAT'S COMFORT!</b><p>




If you do the numbers, you will see that there are times when it is financially more sound to rent and there are times when it financially more sound to own, and maybe even pay on a mortgage. And contrary to what all the realtors will tell you, you can time the market and it is not even all that difficult. All it takes is a little willingness to go against the crowd.
 
<p><em> "would be piss if the SFR for a huntington beach or irvine will cost only 250k or 350k. because i would be able to afford one. but to be honest.... i don't see those house dropping that much.... maybe santa ana or corona."</em></p>

<p><em></em></p>

<p>With proof of income and down payments between 10-20% now to get a loan I think it can happen in Irvine! Try to get a home loan. It's no longer easy.</p>

<p> </p>

<p>


</p>
 
"Awgee, did you not find some comfort knowing that you weren't paying rent? You were losing equity, but how much was the 25% paper loss compared to the rent you would have paid over 3 years?"



That is an agent's sales pitch to fool the dumb buyer. For your first 3 years' mortgage, more than 90% goes to pay for interest, which is wasted as rent is. Considering renting is definitely more than 10% cheaper than

buying at this moment, renting is saving you money.
 
<p>Here's a comp.</p>

<p><a href="http://www.redfin.com/stingray/do/printable-listing?listing-id=1170017">www.redfin.com/stingray/do/printable-listing</a></p>
 
I dont' think that comparison is meaningful. Individual seller can ask whatever riduculous price he wants. A valid comparison will be the recent sale price of a similar plan.

BTW , That is just a flipper(or over-streacher) wants to sell his plan 2 with the 2006 July peak price. His logic must be: there is 200,000 people in Irinve, I just need one ignorant bag holder.
 
<p>Jbatz - my biggest concern is that 1200 sq ft is awfully small, esp. if you plan to have children. My wife and I are in a IAC apt. and we get 1100 sq ft for $2000/month and it definitely feels tight. </p>

<p>Also, the 1200 sq ft is split amongst 2 levels so that makes each area feel even smaller. I know your wife loves the plan but have you really given thought to how it would feel living there and possibly having kids in there?</p>

<p>My recommendation would be too visit Columbus Square and get more sq ft for the same money. I just saw on the forums that Camden Place had 1553 sq ft 2b's for around the same price that you are currently getting on the Savannah model. You can have 300 more sq ft for the same price and more room if your family expands.</p>

<p>If you are 100% ok with the 1200 sq ft, you can save yourself a good chunk of money and check out Cambridge. They had a 1300 sq ft 2b's for a little over $400K with plenty of other incentives like you listed and probably still have similar deals. .</p>
 
<p>House of Cards, I did ask about 6 months ago. The Lennar protesters told me that the complaints were regarding shoddy workmanships. Such things as cracked cement floor, leaky pipes, fewer lumber in the house frames, etc.</p>

<p>Lennar has that "everything included" incentive. For example, the granite counter tops, upgraded floorings, etc. are included in the purchase. So lets say they give away 50k worth of upgrades. While the competitors are not. How does Lennar make a profit? Surely, they're not that generous. </p>

<p>One of the protesters did mention this. The stuffs that's included is nice to the eyes. But how do they recover that cost? Could it be, Lennar is cutting cost in stuffs you don't see. Such as materials behind the walls? Or lack there of.</p>
 
<p>my cousin wants to buy a sony 52" lcd for 4K. i told him that it will be 2k in a year. he still wants to buy it today and enjoy it.</p>

<p>if u can afford and enjoy the new house, there are good reasons to buy it. </p>

<p>sometimes making the best financial decisions don't necessarily make the best happiness decisions.</p>

<p>personally, i think a brand new condo should be worth 400K.</p>

<p>and a brand new sfr should be worth 600K.</p>

<p>renting should be around $1500-$2000, so buying should be around $2000-$2500/month.</p>
 
<p><em>"That is an agent's sales pitch to fool the dumb buyer. For your first 3 years' mortgage, more than 90% goes to pay for interest, which is wasted as rent is. Considering renting is definitely more than 10% cheaper than


buying at this moment, renting is saving you money."</em></p>

<p>Whoa, please don't acuse me of being an agent. That's offensive. Really. And get your math right. Over 90% interest over 3 years? What interest rate are you qualifying for? Or are you talking about the OP's interest-only for 10 years? That's 100% interest over the 1st 3 years, no? </p>

<p><em>"If you do the numbers, you will see that there are times when it is financially more sound to rent and there are times when it financially more sound to own, and maybe even pay on a mortgage. And contrary to what all the realtors will tell you, you can time the market and it is not even all that difficult. All it takes is a little willingness to go against the crowd. "</em></p>

<p>As I stated, the "numbers" do not take everything into account that people are willing to pay for--unfairly so if you want an apples-to-apples comparison. And while I agree you can measure how favorable conditions are, I hesitate to say you can time the market with all that much certainty. People were talking about irrational exuberance years before the stock market crash. Same for housing. Conditions favored a correction years ago, shortly after 2000 IMO. It gave us pause and led us to buy on the cheap in 2003. Our 2nd choice was much nicer. In hindsight we could have profited nicely had we bought the nicer place. We made a choice based on our assessment of market conditions, and based on the "numbers". We did put 20% down, but our payments are about the same or less than equivalent rent. At this point our house value would have to fall another 40% from recent sale comps for us to just break even after taking into account the rent we would have paid over the past 4+ years. By the time the market bottoms and we're ready to buy another place, we'll have skipped over $100k in rent payments, if I assume a very conservative $1200/mo rent. </p>

<p>I have been a bear for years now. I despise the speculators, agents and lenders who pushed the market into stupidity. I revel in the daily doses of schadenfreude gleaned from various sources. I think anyone who buys today is likely to be underwater by a good amount before we're out of the woods. But I know buying a home is more than a purely financial decision, and even if that was the only criteria, the analysis needs to be complete.</p>
 
Sounds like the way Lennar did things in Florida. If I were buying from Lennar, I would be out there everyweekend to see that everything was done right in the construction of the house. In fact, I would hire a structural engineer, in your case, where you can't see what's up. I'm not kidding. Of course, she/he'd be checking for earthquake stuff plus regular stuff, instead of hurricane stuff.
 
i checked out the other places such as:



cambridge lane - it is a tustin zip and there is a 28% low income housing and they did not give as much incentives. plus i did not like the lay out. good points is that it is a lyon's home which has a better rep. and it is closer to my work by about 5 minutes. price is similar 435k vs 412k (lyon home. but at that price they have apply all incentives into lowering the price. Lyon scared me with this tactics... they still have about 5-6 phase left in cambridge and they lower the price by alot. what will be left of their other homes? will they lower it to 340k end of next year and then 240k year after that?



camden- tustin zip vs irvine zip, high % of affordable housing. price is more then savannah last i checked. they wanted 467k and the sales people were stupid and they acted like it was 2004-05 thinking that the seller had the power.



merriweather- best lay out. love the place.... but 496k was too much for me to spend and the 25k incentives was not enough for me. and the math came out to be like 3500k per month. don't want to stretch.



lawerliz- would a structural engineer be worth it? what if he goes in and tells you that they met the code but they didn't go beyond... what are your options then? walk away from the deal? i am sure they are not going to change their plan to change everything to close one deal. plus i am out there every weekend but i honestly don'tk now what i am looking for anyways.... hahahaaa but the construction manager is nice. i spoke to him yesterday and all. he let me walk though all the units since the sales office is close and they started working on the last phase already.
 
Daedalus:

"Over 90% interest over 3 years? What interest rate are you qualifying for? Or are you talking about the OP's interest-only for 10 years? That's 100% interest over the 1st 3 years, no? "

Sorry, I made a mistake. The actual number for first 3 years is 85% of your payments goes to interest. Here is the amortization table for 700k loan with 7% current jumbo rate :



Amortization Table

Year Loan Balance Yearly Interest Paid Yearly Principal Paid Total Interest

2008 692,889.33 48,774.74 7,110.67 48,774.74

2009 685,264.63 48,260.71 7,624.70 97,035.45

2010 677,088.74 47,709.52 8,175.89 144,744.97
 
If the Bears predictions come true then you will have more appealing options if you wait.



As an example:



If prices drop another 20% in HB in the next 1 to 2 years you might be able to get into an SFR

for a little more than you are about to spend on this condo now.



www.redfin.com/stingray/do/printable-listing?listing-id=1088214



www.redfin.com/stingray/do/printable-listing?listing-id=1314079



www.redfin.com/stingray/do/printable-listing?listing-id=1290252



Something to consider...
 
<p>jbatz,</p>

<p>was almost in the same situation last year. renting 1bd 700sqft in brea. have quite a bit saved up for downpayment and wife wanted to really buy a home.</p>

<p>we ended up moving to a brand new 3bd townhome and renting for $2500. Equity continues to grow - interest on principal and accumulate savings.</p>

<p>that might be another option, renting out a bigger/much nicer place.</p>
 
jim jones-



i did my math and if i was to buy a older house in HB the most i could afford was 380k. due to the following....



i would only want to put about 10% down due to needing a higher reserved for fixing up and upgrading or remodeling.

thus this creates cost such as PMI.

harder to get loan. since i am putting down less.

closing cost. and no money to buy down points. thus higher interest rate.



my original plan was to buy a SFR in westminster for 350k but guess what? price even in westminster for a SFR is 450k. true price.... cause i been tracking alot of them and they sell once the owner lowers it to say 425k-450k. the ones that is still sitting on the market is because the house is crap and they have major issues, crack foundation, black mold. short sale where the bank actually wants 500k and not 450k.
 
Jbatzmaru-



Ya I suppose I'm looking at your situation based on my own personal preferences which for me is: I would be willing to have

something a little older and in need of a little work if it meant I could have my own yard, no common walls, etc. IE an SFR.

I have a hard time not thinking of condos as glorified aptmartments. I suppose some people value living in something brand new and

are willing to tolerate stuff like common walls, no yard, limited parking, etc, etc. I fixed up an SFR I owned a few years ago. For me I just really liked the idea that my little 2 bedroom house was not attached to a common structure and having a yard was a lot of fun. Plus I didn't have to be paranoid about playing my stereo too loud, etc, etc. I don't think I would have had that pride of ownership if I had purchased a condo. I just really preferred that feeling of control that I don't think you will get when you are purchasing a portion of a structure. If you were to get into an older SFR would it be a requirement to immediately upgrade everything? Or would it be ok to slowly upgrade stuff over time? I wouldn't be surprised at all if those properties I listed for you are going for around 450k to 470k in 1.5 years.
 
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