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I would recommend taking the time to really educate yourself about the housing market before making a decision either way. As you said, prices have fallen considerably in a short time. This tells you that the market is in flux. Should you keep waiting for prices to fall even more, or should you...

<p>"Lady said next phase's prices aren't coming down, and made some comment about how Lantana and Cantara are not comparable. Whatever."</p> <p>Very astute to notice that. It reminds me of a comment I read on another blog the other day.</p> <p>"I expect the large builders such as Pardee...

<p>IrvineRenter,</p> <p>I see your point of view too. People with a more positive view of housing than ours have a lot to contribute and this website is definitely better off for it.</p> <p>However, about a year and a half ago, before I understood what was going on, reading various...

<p>Awesome!!! Congratulations. Thank you so much for posting; I bet that people like you are a big reason why our wonderful hosts zovall and irvinesinglemom, not to mention many other bloggers, work so hard to keep us informed.</p>

<p>Woohoo!!!! A 20% raise every year for the next 5 years! Sweet! I'd better go down to Fletcher Jones tomorrow to get a ride more befitting my new salary.</p> <p>Seriously though, you might very well be right and something will happen to cause wages to skyrocket. But high rates of income...

<p>HomeHunter, I don't think you see my point at all. I never said that someone making the median income should be able to buy anywhere they want. Obviously that is nonsense that only a socialist would believe. The median home price in Irvine is around $690K. So despite being new & extremely...

<p>"I don't expect 30% annual returns on funds, and I never buy RE with funny loans. For US RE I use 15 or 30 year fixed rate loans only. No ARM's. For people who are buying a "home", I recommend only buying what you can afford using standard 15 or 30-year fixed rate loans. I don't...

Sorry, looks like I forgot the 'K'. Since the example was a down payment of 10%, I figured 650K - 65K = 585K.

<p>I can afford to buy now. It's just a matter of what I expect to get for the money.</p> <p>Let's say that someone negotiates down to $650K for a plan 1, and gets a $585 mortgage. Assuming that they don't use a suicide loan, this probably means they make a yearly income of at least $146K (4X...

<p>Numbers,</p> <p>You are right, there is more to the story than just the "basic" numbers (no pun intended) I listed once you start going into details. Besides tax savings (maybe not that much, since many who can afford 5K / month will be AMT) there is also maintainence, depreciation...

<p>So let me get this straight. For a 3/3 <em>condo </em>I get the privilege of paying every month:</p> <p>$1033 in taxes</p> <p>$400 in HOA</p> <p>$4000 mortgage carrying cost (interest only at 6.25%)</p> <p>For a grand total of $5433.</p> <p>Or, for just about half that, I can rent...

Very good point. I think a lot of situations very much like your example exist right now and are a big reason why home prices are "sticky" on the downside. Very few underwater owners have the cash to bring to the table and even if they did, why would they given the non-recourse law? The problem...

<p>Interesting calculations Fraychielle. But I think you are overestimating the importance that interest rates have had and will have on prices. Even with the low interest rates we have now, payments are much higher than the historical norms in relation to income and rents. So don't assume that...

<p>The IE was a little late to the Southern California bubble. Without even meaning to, you caught a good piece of that and got a great windfall. I congratulate you and your wife on your good fortune. And also for not settling for the IE and moving to Irvine. I grew up in Riverside County and...

<p>I guess I should have read you post more carefully. You're right that if you expand the search to include all Irvine then there are lots of 2 beds in that range.</p> <p>So I conceed that if prices fall 30%, AND you shop around and find a good deal, AND you manage to maintain a low vacancy...

<p>Sorry if I misconstrued anything you said momopi. Not my intention. In any case... I could not agree more that $280k - $350k is a pretty good price for a 2/2 near UCI. Find me one of those babies and I will buy myself a new home tomorrow! Seriously, I am looking to buy near UCI or maybe...

<p>duplicitron, </p> <p>I don't think a 50% nominal drop is very likely. But a 50% real drop is certainly possible and would not suprise me at all. Please take a look at the links IrvineRenter sugests if you want to know why I hold such an opinion. Pigginton has a lot of good numbers and a...

<p>momopi, you are saying a lot of interesting things, but I'm afraid I don't really understand the conclusion you are trying to draw.</p> <p>So let's just look at your original point and focus only on buying a home to live in and ignoring all investment aspects. I agree with you that this...

<p>That's what really burns me about the housing run-up. You are right dup, ordinary people like you and me should just be able to buy when we are at the right time in our lives and not worry about timing the market. But prices got so high - crazy, unjustified, once-in-a-generation-high - that...

<p>I am not sure what to make of the weird mortgages you mention. The payment on a 40 year, or for that matter, a 100 year mortgage are not very much lower than a 30 year at all, especially once you factor in the slightly higher interest rates that banks would charge. The difference is almost...