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

jbatzmaru_IHB

jbatzmaru_IHB

New member
Hello All- i would like to hear all the bears comments on why i should walk away from my 5k deposit.



My current situation:

paying 1250 for a apartment in HB and i work in Santa Ana about 45min commute one way, since i am going down edinger from springdale to redhill. my wife works in newport. Currently we are running out of space since our apt. is only 550 sqft.



So we decided to buy in savannah residence 2 (1209 sqft) price is with the following incentives.



13k upgrade wood flooring.

8k in 2 year hoa payment.

5.7k in closing cost

8k in shutters

13k in buying down points.

got a loan locked in at 5.5% fix. 10 year interest only and then 20 year interest and principal.



so monthly payment is 1595. tax: 585 (i consider this a wash since i will pay it once every year when i get my refund) and hoa 323 (not worrying about this for 2 years.



currently our income is about 115k combine and we have no kids. and only my student loan at 303 per month (planning to pay this off in 2 years and use this money to pay the hoa).



Thank You all for reading.... this blog is very in informative.....
 
<p>Looks like a push to me. You'd probably be underwater for about 5-7 of those years. If you can put all the allowences toward the principal and get the cost closer to 300sq/ft that would be better. But you'd still be under water. </p>

<p>How much are you bringing to the table as far as down? 10? 20? more? If you bring less than 20, i'd thing they will look at you alot, if you bring more than 20, you look alot better (money goggles...). </p>

<p>Good luck</p>

<p>-bix</p>
 
Jbatz - congrats on your purchase. Im not here to tell anyone when or at what price to purchase. Its a good feeling to be living in a brand new house, enjoy!





Also - i pay rent of 2,480 at woodbury for a 2 bed 2 bath townhouse, so looks like you will pay less than me.
 
Well the good thing is that it's 2 bedroom so at the time you are ready to sell down the road it will be an easier sell. However, at 353 dollars / sqft that is not my cup of tea. How much are you putting down?
 
<p><em>Also - i pay rent of 2,480 at woodbury for a 2 bed 2 bath townhouse, so looks like you will pay less than me.</em> </p>

<p>How big is your townhouse? Does this mean house prices finally dropped below rent prices?</p>
 
<p><em>Does this mean house prices finally dropped below rent prices?</em></p>

<p>Cheaper with some creative financing. After 10 years the payment on the loan only goes to $2992/mo. But I think 10 years is a good time frame to have an expectation we'll have seen the bottom. With 3.5% inflation/year, that $2992/mo is only $1980/mo in today's dollars. You're kind of risking your credit for a call option on the property that matures in 10 years.</p>
 
<p>Just to make it clear, I'm not saying this is a bad deal. As long as you're sure you won't have to sell for a while, it seems to make sense in at least a few ways.</p>
 
<p>10 years is a long time, I don't see a problem there. Great depression took that time to burn out.</p>

<p>Maybe you can scare the seller into granting more concessions, by threatening to leave behind the 5 grand. Might not work, but worth a try.</p>
 
thank you all.. for your comments so far....



i am bring in 20% down.



i am not planning to sell.... hoping to rent it out and buy my next house with the money i save up in the next 8 years. or worse case.... i will pay one big lump sum and end up living there longer if the market goes bad....
 
JBatzmaru





I guess it's not really that bad of a deal if you really love the place. If you are really thinking of keeping the place for the long run hopefully you will break-even after ten yrs.





My only suggestion is that you try to pay as much towards principal over the first ten yrs as possible. I am not sure if their is a penalty for this but the lower the principal is come the time for a reset the better position you could be in. On top of that if prices have not come back to the level you purchased at you have a bigger buffer....just my opinion so take it for what is it worth, not much.
 
lawyerliz.... i was thinking about that.... can you or anyone who have bought from lennar comment more on that? i was going to nick pick when we do the walk though and point out weak craftsmanship and demand that they fix it. walk though is jan 8 and closing is jan 15. doesn't give them much time to fix it and instead i will live with it if they give me 5k for furniture or something..... do you think it will work? i know they won't lower their price for sure cause i already took them down from 451k. their last phase price has been release for 451k with no incentives.... i asked the sales guy and he said that they are not worry cause they have 10 months to move it.
 
<p>jbatzmaru,</p>

<p>I am going to sound like a NAR shill but there really is not a bad time to buy if 1) you intend to live in the property for a long time (7-10 years), 2) you can afford it, and 3) you like the house for the house, not for economic reasons. If this it true for you for this house, I think it is great that you are buying. </p>

<p>However, my sense is that you are trying to pick up a bargain. If that is the case, I would not buy. Housing prices are likely to fall for the next 1 to 2 years and remain flat for 4-6 more. Renting the house out will create more problems than solutions. You can put the $80-100K in downpayment into a high-yield savings account and get 5-6 percent, you are not getting 5-6 percent back on your money by renting it out or selling it later. People always forget to factor in the 6 percent fee that you have pay to sell the house. </p>

<p>If you are planning to use this house as a step up, you can get a much bigger house in 2-3 years for about the same price and be able to put down a larger downpayment. </p>

<p>BTW: I just noticed your blurb about student loans. Is it a government loan? If so, what is the interest rate? I have some government loans locked in at 2.75 percent that I will drag out as long as possible. </p>

<p>Personally, I did not like the plans at Sannavah but I am not one buying </p>
 
thanks for the comment irvine commuter.... but right now me and the wife is running out of room.... i swear the christmas present at my apt is stack everywhere and it is about to cave in on me....



As everyone has agree a house is the worse investment you can make when compare to investing in stock in the long run.... but it does provide a roof over my head and some write off in tax. plus it cuts my commute down to about 10 minutes one way. putting it away in a 5% CD is nice but i still have to pay rent to some old junk apt in HB with no write off and risking my life driving though santa ana every night.... hahahhaaa



main reason i am buying is for more room and shorter commute.



Quick question.... has anyone put money in a CD and have the bank get taken over by the FED? what happens to your money and how long does it take for you to get it back from FDIC?
 
<p>jbatz...</p>

<p> Looks ok, i don't know if you can do anything to get them to come lower. I would negotiate up from and go from there. BUT i would make sure they deliver a good house to you.</p>

<p>-bix</p>
 
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