Author Topic: How low can we go? 30 yr fixed at 3.75% with no fees...  (Read 845750 times)

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Offline irvinehomeowner

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3450 on: May 16, 2022, 11:11:34 PM »
But in reality, how many first time homebuyers have the mental discipline to not stretch? especially given the recently escalated affordability problem

So maybe I'm an optimist... I prefer to stretch because also motivates you to do more.

I bought my first home without any parental help... even made sure it was an SFR because my future father-in-law advised me never to buy an attached condo (which is why my first place wasn't in Irvine). But I eventually ended up back in Irvine and in retrospect, would have been okay with that attached condo in Irvine as my first home too (it appreciated more than my non-Irvine SFR!).
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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 #3451 on: May 16, 2022, 11:36:06 PM »
But in reality, how many first time homebuyers have the mental discipline to not stretch? especially given the recently escalated affordability problem

So maybe I'm an optimist... I prefer to stretch because also motivates you to do more.

I bought my first home without any parental help... even made sure it was an SFR because my future father-in-law advised me never to buy an attached condo (which is why my first place wasn't in Irvine). But I eventually ended up back in Irvine and in retrospect, would have been okay with that attached condo in Irvine as my first home too (it appreciated more than my non-Irvine SFR!).

We also bought our first home with our own money. We bought a new townhouse (since my wife would only buy new construction) instead of older SFR. Buying new construction also worked in our favor because we only needed to put down 3% deposit at the time we reserved the home and had 9 months to come up with the rest of the down payment. As a first time buyer, I wasn't even aware of that. We were very discouraged at the point as we didn't have the 10% down payment, but when I talked to my co-worker, he told me about the deposit. I had the money in ESPP that would become available 6 months later. That's how we were able to buy our first home.

As for financing, I was able to borrow 10% equity loan to make it 20% down payment to avoid PMI. We closed escrow 9 months after we reserved and 3 months later the house had already appreciated so much that we were able to refinance to cash out enough to pay off the equity loan.  ;D

Offline The California Court Company

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3452 on: May 17, 2022, 06:54:20 AM »
So IHO you finally got a 3WCG house in Irvine?
As I alluded before, I bought a 3WCG mainly inspired by your pursuit and every day I go home and park on the driveway I am happy I did.
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Offline Cares

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3453 on: May 17, 2022, 09:09:59 AM »
I don't know why builders don't just build new homes with 3 car garages. I bet they can sell it for a pretty big premium even with a smaller sized home.

Offline sleepy5136

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3454 on: May 17, 2022, 09:56:28 AM »
I don't know why builders don't just build new homes with 3 car garages. I bet they can sell it for a pretty big premium even with a smaller sized home.
don't you need a pretty wide lot to do 3 car garage? if so, a row of 10 homes might end up being 6 or 7? You can only add so much premium on a 3 car garage. The premium won't outweigh selling 3-4 more homes.

Offline irvinehomeowner

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3455 on: May 17, 2022, 10:23:10 AM »
You can fit 3CWG into the current lot widths, but then bk/IHS will resurrect his TI account and tell us how full frontal garage is the ugliest house design in the world.

Who needs front yards anyways? We are in a drought! :)
Once you go 3-car garage... your junk can never go back.
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Offline sleepy5136

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3456 on: May 17, 2022, 10:48:58 AM »
You can fit 3CWG into the current lot widths, but then bk/IHS will resurrect his TI account and tell us how full frontal garage is the ugliest house design in the world.

Who needs front yards anyways? We are in a drought! :)
mexican pebbles ftw. front yard is important though but could be argued it's more to please the outsiders than yourself :)

Offline Liar Loan

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3457 on: May 18, 2022, 11:12:38 AM »
Must be some of that good 'ol seasonality... right, IHO?

Weekly mortgage demand from homebuyers tumbles 12%, as higher interest rates take their toll

Mortgage rates actually fell slightly last week, but the damage has already been done to housing affordability. Both refinance and purchase loan demand dropped, pulling total mortgage application volume down 11% for the week, according to the Mortgage Bankers Association’s seasonally adjusted index.

Mortgage applications to purchase a home declined 12% week to week and were 15% lower compared with the same week one year ago.

Offline Liar Loan

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3458 on: May 18, 2022, 11:40:04 AM »
I'm listing my homes in Lake Elsinore and Eastvale soon. I just hope to sell them before housing price starts dropping.

You may want to get on that.

Homebuyer Competition Falls for Second-Straight Month, Hitting Lowest Level in Over a Year
Riverside, CA and Atlanta saw the biggest annual declines.

In Riverside, CA, 42.7% of home offers written by Redfin agents faced competition in April, down from 64.6% a year earlier. That 22-percentage-point decline was the largest among the 36 U.S. metropolitan areas in this analysis.

“Homes that would have received 10 offers several months ago are now getting two or three. That’s because the jump in mortgage rates has forced a huge pool of first-time buyers to drop out,” said Elizabeth Rodriguez, a seller’s agent with Redfin in Riverside. “The buyers who are still in the market are those who are less sensitive to mortgage rates because they have big cash reserves.”

Rodriguez continued: “Sellers are still in the driver’s seat, but I expect to see the market level out over the summer, giving buyers some long-awaited room for negotiation. Homes are starting to sit for longer and sellers are starting to accept contingencies. They will likely start accepting offers from buyers who come in at the asking price. I’m advising people to sell now if they’re considering it.


https://www.redfin.com/news/real-estate-bidding-wars-april-2022/

Offline irvinehomeowner

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3459 on: May 18, 2022, 02:52:07 PM »
As seasonal as LL's Irvine pain predictions.

Poor guy... you lost your credibility so you are resorting to spamming other sites' content in hopes someone else gets it right for you.
Once you go 3-car garage... your junk can never go back.
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Offline Liar Loan

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3460 on: May 24, 2022, 03:30:58 PM »
LL, tell me how me buying my new Irvine home is a mistake when:

1. I'm exchanging my Eastvale home for the Irvine home.
2. My wife wants a NEW home in Portola Springs. Will I find one in 1 or 2 years when the price stops dropping?

Like IHO said, when buying a home, you need to consider affordability, location and desired features. All three checked out for us. And then there's also availability. How is that a mistake?

Did I misread when you said your budget was 900k-1M, but you stretched to pay 1.7M?  Not overpaying also matters in more ways than one.

If the ups and downs of Irvine prices really didn't bother you, then my posts wouldn't bother you either.  It would be neutral information to you.

Offline Liar Loan

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3461 on: May 24, 2022, 03:37:19 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. 

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.

Comparing crypto to a primary residence is an apples to orange comparison.  One is a speculative investment while the other is mainly a commodity and housing prices are much less volatile than crypto prices.

Ah, but I wasn't comparing crypto to housing, just using it as an illustration to make the point:  Losing money on paper has real world impacts

When CalBears and I purchased our "commodity" homes near the '05-'06 peak, it eventually forced us into becoming involuntary landlords.  That in turn affected our ability to buy move up homes because our DTI's were negatively impacted by having rentals that, in the best-case scenario, were break even.  In my case, it prevented me from loading up on investment properties until my balance sheet was sufficiently repaired.  I would have loved to have bought more properties from 2009-2011, but it wasn't until 2014 that I was in good enough shape to do so.  All because I purchased one property at the wrong time.

I've already recounted the huge pain it was appealing my property taxes year after year.  Thankfully, I was able to get a very good set of renters that stayed in my "involuntary" rental for seven years.  They saved me a bundle by keeping my repair and turnover costs lower, and always paying on time.  It sounds like CalBears' landlording experience wasn't as smooth as mine was.

CalBears and I have similar home buying histories, but there is a major difference between us because I learned the hard way that timing is probably the most important thing when buying real estate.  CalBears is set to repeat the same mistake as last time.

Calling real estate lower volatility than crypto is correct, but that doesn't mean real estate is a low volatility asset.  Anything that moves up or down by more than 20% per year is, by definition, high volatility.

AH HA! SO YOU bought at the peak and weren't able to buy more because of it. Dissing me because I bought at a peak (not 2007. I was in a house nearly paid off by then) but in fact my peak house didn't prevent me from buying another. Nope, in fact not only did I pay that one off in full before renting it out, I bought ANOTHER one in Irvine. This was before I bought the big "forever" home in Irvine.

I WANTED to sell at the top and buy at the bottom but hubby wanted to stay. Did it hurt us? NOPE, not one dang bit. Sat in my nice big Irvine house on a big lot with my four car garage.

AND so after that, you go on and on about how bad a move I'm making. LOL! I sold high and if I bought high as well, who the hell even cares? I took out a whole lot of money. If things go down, they go down a whole lot less for me and my property taxes ain't gonna hurt me one bit cuz in the land of snakes they aren't figured the way they are here and just because houses go up a lot don't mean property taxes are going to there, ESPECIALLY for areas that have lots of new builds contributing to the tax base.

So it finally comes out. I wondered why the hell u r always so bitter.

I bought at the peak in 2006, then near the bottom again in 2010.  Guess which one I liked better?  The only pain I suffered was the unfortunate reality of not being able to buy investment properties until 2014/15.  It would have been great to scoop up more real estate in 2011, but the negative impact of the 2006 purchase on my DTI prevented that.  (Granted, I could have partnered with others, but I didn't want to.)

I've never "dissed" you.  To the contrary, I've given you mad props for your story of humble beginnings and I've also complimented your daughter for her savvy real estate moves.

Offline CalBears96

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3462 on: May 24, 2022, 04:10:14 PM »
LL, tell me how me buying my new Irvine home is a mistake when:

1. I'm exchanging my Eastvale home for the Irvine home.
2. My wife wants a NEW home in Portola Springs. Will I find one in 1 or 2 years when the price stops dropping?

Like IHO said, when buying a home, you need to consider affordability, location and desired features. All three checked out for us. And then there's also availability. How is that a mistake?

Did I misread when you said your budget was 900k-1M, but you stretched to pay 1.7M?  Not overpaying also matters in more ways than one.

If the ups and downs of Irvine prices really didn't bother you, then my posts wouldn't bother you either.  It would be neutral information to you.

I said we initially set a budget for $900k, but that's because we didn't know what the housing market in OC, or Irvine specifically, was like. After we checked out Serrano Summit, we realized that our initial budget would not do. So once we realized what the OC market is like, we CALIBRATED our budget, NOT stretched. We bought the home for $1.55M, and we added $135k of upgrades, so the final price is $1.685M.

Was it expensive? Sure. Did we overpay? Maybe, maybe not. Was it worth it? Hell yeah!

I'll say it again. Your posts don't bother me. Your ATTITUDE bothers me.

Offline irvinehomeowner

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3463 on: May 24, 2022, 05:13:12 PM »
I've never "dissed" you.  To the contrary, I've given you mad props for your story of humble beginnings and I've also complimented your daughter for her savvy real estate moves.

Backhanded compliments.

You even started an Arizona thread to make an example of her decision to buy there until she told you that she wasn't even buying in the places your links/charts were using.

#stealthtrolling
Once you go 3-car garage... your junk can never go back.
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Offline Liar Loan

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Re: How low can we go? 30 yr fixed at 3.75% with no fees...
« Reply #3464 on: May 25, 2022, 11:53:36 AM »
I've never "dissed" you.  To the contrary, I've given you mad props for your story of humble beginnings and I've also complimented your daughter for her savvy real estate moves.

Backhanded compliments.

You even started an Arizona thread to make an example of her decision to buy there until she told you that she wasn't even buying in the places your links/charts were using.

#stealthtrolling

The Arizona thread was started because we were already discussing the market there, but it was off topic for the thread where the conversation started.  Providing information about the Arizona bubble isn't making an example.  I also discuss the bubbles in crypto, bonds, and collectibles.  It's her choice what to do with that information, but most people are appreciative when others help them avoid losing money.

I guess much like awgee when I pointed out the bubble in gold back in 2011, some people get mad when you tell them their convictions are wrong.  He rode his convictions all the way down to the bottom and then quit posting on these forums after that.

 

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