Author Topic: How low can we go? 30 yr fixed at 3.75% with no fees...  (Read 827230 times)

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Offline CalBears96

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3420 on: May 05, 2022, 03:52:36 PM »
CalBears and IHO seem incredibly insecure about their home prices, which belies the fact that a home is more than just a place to live in their minds, despite the lip service they pay to "buy anytime if you can afford it".

More lies.

Where am I insecure about my home price? I'm not actively shopping anymore so it doesn't really matter.

It's you that are insecure about Irvine home prices... because you have been so wrong about them.

Hilarious.

Not only is he a Liar. He's dumb as well. I have already stated that this is going to be my retirement home and I'm going to live here for a long ass time. And the way the rates are rising, it's going to take some years before I could even think about refinancing the house. So why do I care about my home price? In fact, if it does drop 20%, then I'm going to pay less property tax.

Use your tiny brain sometime, Liar.

Offline sleepy5136

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3421 on: May 05, 2022, 06:59:53 PM »
Thanks to the pandemic, I have a feeling if there were any recession in the future that mortgage forbearance will get activated by the gov. I don’t think the gov wants to see 2008-2009 ever again. I don’t personally agree with this tbh but the gov especially California do not want more people on the streets.

Offline Liar Loan

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3422 on: May 06, 2022, 11:51:00 AM »

Offline Liar Loan

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3423 on: May 06, 2022, 12:40:28 PM »
So why do I care about my home price? In fact, if it does drop 20%, then I'm going to pay less property tax.

Yep...Losing $340k in order to pay less property tax sounds like a brilliant strategy.  Good math too.

Offline qwerty

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3424 on: May 06, 2022, 01:05:54 PM »
It’s like a tax deduction. People make it sound like tax deductions are great things. They are if you were going to invite the expense anyway. 

But paying $1 to save 30-40 cents in taxes is never a good idea.

Offline Liar Loan

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3425 on: May 06, 2022, 01:59:03 PM »
In Orange County, they won't necessarily lower your property taxes automatically either.  They did in the last couple years of the downturn, but that was because they were flooded with tax appeals and couldn't schedule enough hearings.  Even then, they didn't necessarily lower them enough. 

I still appealed my 2012 taxes even though they got lowered automatically, because they didn't lower them enough.  That year, instead of forcing me to attend a hearing, they allowed me to negotiate over the phone and I was able to get them lowered to where they should be. 

In the earlier years of the downturn, I had to appear in person for the tax appeal hearings and they were inconvenient.  You have to go mid-morning on a workday (so basically miss half a day of work), pay the parking meters at the old Santa Ana courthouse, listen to everybody else's hearing before it's your turn, and then deal with the appeals board which usually consists of three real estate brokers, not professional appraisers.  Some of them were nice and some were less than friendly.

The representative from the assessor's office has the upper hand because they've attended hundreds of these hearings and know exactly what to say to win their case against you, making it harder to win your appeal.  So after going through all of that, you're not guaranteed a win.  My record was 2-1 of the three times I appealed. 

There were two other years where my value was automatically lowered, and while the amount was still too high after it was lowered, it was not a big enough difference to miss a half day of work for the miniscule difference in savings I would have received. 

Never once in those five years of falling prices did they get my value right though -- It was always too high and in the assessor's favor.

Offline Soylent Green Is People

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3426 on: May 14, 2022, 11:38:31 AM »
It's great to appeal property taxes and have them reduced - although MR bond payments are not scalable. If there is a price decline and your value drops enough to warrant a property tax appeal, by all means do it. Bear in mind though that the 2% cap of property tax increases DOES NOT APPLY if you've had your property taxes lowered. The Assessor can raise your taxes back up to the original amount or higher to the level your property taxes were paying before the lower adjustment.

Example: 12k per year in 2022 might be reduced to 10k per year if values fall in 2023. If prices rebound in 2024 and you should have been paying $14k in property taxes, the assessor isn't limited by 2% cap from your 10k per year taxes. They can raise your property tax up to $14k next assessment.

At least that's how things worked during the 1991-1994 and 2008-2011 property value decreases.

My .02c
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Offline USCTrojanCPA

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3427 on: May 14, 2022, 04:54:26 PM »
So why do I care about my home price? In fact, if it does drop 20%, then I'm going to pay less property tax.

Yep...Losing $340k in order to pay less property tax sounds like a brilliant strategy.  Good math too.

You do realize it would be a paper loss and he would be using the home as a necessary commodity (i.e. a home to live in) so unless he needs to sell right away it doesn't matter what prices do in the short term. 
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Offline CalBears96

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3428 on: May 14, 2022, 05:21:17 PM »
So why do I care about my home price? In fact, if it does drop 20%, then I'm going to pay less property tax.

Yep...Losing $340k in order to pay less property tax sounds like a brilliant strategy.  Good math too.

Are you really that dumb? It's a short term drop. I'm NOT losing anything unless I sell the home. And I already said that I'm not selling the home for a VERY LONG time. And for your information, my home has ALREADY appreciated $240k since I bought it and I haven't even closed escrow yet.

Offline Kenkoko

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3429 on: May 14, 2022, 11:31:12 PM »
It's a short term drop. I'm NOT losing anything unless I sell the home. And I already said that I'm not selling the home for a VERY LONG time. And for your information, my home has ALREADY appreciated $240k since I bought it and I haven't even closed escrow yet.

Question - If the premise is NOT selling for a very long time, wouldn't that make unrealized gain equally pointless as unrealized loss?

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Offline CalBears96

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3430 on: May 14, 2022, 11:57:41 PM »
It's a short term drop. I'm NOT losing anything unless I sell the home. And I already said that I'm not selling the home for a VERY LONG time. And for your information, my home has ALREADY appreciated $240k since I bought it and I haven't even closed escrow yet.

Question - If the premise is NOT selling for a very long time, wouldn't that make unrealized gain equally pointless as unrealized loss?

It does. Which is why I don't care one way or the other. But that dummy LL was saying that IHO and I are incredibly insecure about our home prices. He really is a classless troll who just refuses to admit that he was wrong about Irvine housing price. That is why I don't have any respect for him whatsoever.

Offline Compressed-Village

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3431 on: May 15, 2022, 04:52:20 PM »
It's a short term drop. I'm NOT losing anything unless I sell the home. And I already said that I'm not selling the home for a VERY LONG time. And for your information, my home has ALREADY appreciated $240k since I bought it and I haven't even closed escrow yet.

Question - If the premise is NOT selling for a very long time, wouldn't that make unrealized gain equally pointless as unrealized loss?

It does. Which is why I don't care one way or the other. But that dummy LL was saying that IHO and I are incredibly insecure about our home prices. He really is a classless troll who just refuses to admit that he was wrong about Irvine housing price. That is why I don't have any respect for him whatsoever.

Housing imbalance is still savagely unhealthy. We still have too much overbidding going on and only will get worse unless much higher rate flows into the borrowing cost. Higher rate is the only thing that can put a lid on developer, builders and home investor on their asses.

Offline CalBears96

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3432 on: May 15, 2022, 05:06:01 PM »
It's a short term drop. I'm NOT losing anything unless I sell the home. And I already said that I'm not selling the home for a VERY LONG time. And for your information, my home has ALREADY appreciated $240k since I bought it and I haven't even closed escrow yet.

Question - If the premise is NOT selling for a very long time, wouldn't that make unrealized gain equally pointless as unrealized loss?

It does. Which is why I don't care one way or the other. But that dummy LL was saying that IHO and I are incredibly insecure about our home prices. He really is a classless troll who just refuses to admit that he was wrong about Irvine housing price. That is why I don't have any respect for him whatsoever.

Housing imbalance is still savagely unhealthy. We still have too much overbidding going on and only will get worse unless much higher rate flows into the borrowing cost. Higher rate is the only thing that can put a lid on developer, builders and home investor on their asses.

Yes, there is still too much overbidding. And even new construction is still going strong. Both Bluffs detached condos that were just released are already sold, at $1.75M for plan 1 and $1.825M for plan 2. That's crazy price for detached condos, right? Housing price is going to flatten soon though. Even builders are seeing this as the price increase between phases is slowing down.

I'm listing my homes in Lake Elsinore and Eastvale soon. I just hope to sell them before housing price starts dropping.

Offline Soylent Green Is People

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3433 on: May 15, 2022, 05:35:58 PM »
I don't see this as an inventory problem, but one of too few owner occupants versus renters. People on the board won't like to hear it, but there are very few ways to "knock investors on their asses". Some could be:

1) If financed, require 50% down  US Sourced funds (12 month visibility) no matter the 1st loan provider.

2) If "All Cash" then 24 months of US Bank visible funds - reducing the velocity of laundered money that's parked in real estate.

2) Remove depreciation as a tax benefit for any (Mom + Pop, or Corporations) investment property holders after the 5th property is owned. 1 primary, 1 2nd home, 3 rentals) This might prevent Blackstone, etc al, from buying up properties, or builders producing SFR Rentals like Lewis Homes, etc.

3) A 50% surcharge on gross (not net) rental income that is $1.00 over the area median census tract rent. Keeps the rent moderated without specific neighborhoods becoming a rent controlled area. Yes, this might exempt large apartment complex owners, but the better outcome is more single unit owner occupied home owners.

These (unobtainable) changes might cause a land rush to sell. What then might be an incentive large enough for an investor to go along with this?

A) Government would create a "Land Bank" - common during the S+L Crisis and the 2008-2011 Great Recession. Sell the property to the Land Bank at a market price and the sellers Capital Gain would be zero. Sellers fees would be zero-ish, but low.

The Land Bank would resell the properties to anyone other than direct or extended family members of the previous owner (reducing most tax cheating) with a 7-10 year owner occupancy requirement, verified through tax returns.

Rent reduction, preservation of up to 5 single units owned by individuals. No penalties for 2-4 and up unit ownership, cash flush investment property owners, and many new 1st and 2nd time owners, rather than generational renting.

Radical change could reduce the"owner occupancy" gap in housing relatively quickly while admittedly pushing prices down and disrupting many industries.

At some point the price dam will break. I'd rather see some order imposed early on than witness an uncertain free fall caused by renters carrying pitchforks and torches. That kind of revolution is coming if change isn't imposed soon IMHO.

My .02c
My .02c

SGIP

Offline Liar Loan

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3434 on: May 16, 2022, 11:59:40 AM »
So why do I care about my home price? In fact, if it does drop 20%, then I'm going to pay less property tax.

Yep...Losing $340k in order to pay less property tax sounds like a brilliant strategy.  Good math too.

You do realize it would be a paper loss and he would be using the home as a necessary commodity (i.e. a home to live in) so unless he needs to sell right away it doesn't matter what prices do in the short term. 

The crypto investors that are down 50-80% have also experienced paper losses of a "necessary" commodity.  In reality, their losses are very real and have a real world impact. 

They can no longer borrow against their holdings, their savings and net worth are decimated, and if they need to sell it's going to take a long time before they can write off their losses, which you as a CPA well know.  What is the rule on writing off losses on a principal residence again? 

Everybody thinks they are a long time owner and will never sell at a loss, but life has a way of punching people in the face and changing their plans.  There are almost too many people to count that were forced to sell at a loss only a dozen years ago.  Same deal in the 90's.

Any way you slice it, buying at the peak of a market cycle is a bad idea.  You will be paying higher taxes and financing costs on a depreciating asset that you could have gotten cheaper if you had only been a little more patient.

 

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