mgdeals said:bassmanben said:cameron2003 said:I am a UC Davis Alum too. I guess Davis graduates are cheap, I had a feeling...Aggie pride. We pwn Stanford.

UCD = backup plan if you don't get into Cal.

Haha, no its for people that dont want to live in or near Berkeley.

bassmanben said:cameron2003 said:I am a UC Davis Alum too. I guess Davis graduates are cheap, I had a feeling...Aggie pride. We pwn Stanford.


i gave up the cold war university and went for uc berkeley

vinny09 said:In all, I'm thinking if I walked in right now, I could probably get one for $410K-$420K. Currently, they have 32 total homes released in their 1st phase, with 15 sold so far, but none built. Advice greatly appreciated. Thanks!

I know this area well; we just sold our rental house in Davis early 2005 after 8 years. We did not do any 1031 exchange, contrary to advice of many real-estate professionals; just paid our taxes and took our profits. The pricing in Woodland has gone crazy; at least the Davis school district is good and is a nice town to live(hated the city bureaucracy as a landlord).

Woodland does not have an economic base to support the current home prices, has poor schools & and is not as attractive to Asian immigrants as SF & LA areas are.

If you can afford a fixed-rate loan and have 20% down-payment, go ahead and buy the home if you plan to stay in Woodland for the next 5 years.

chuzzlewit said:cameron2003 said:Interesting, but I doubt many people would walk away from their house if they still had liquidity (stocks, paychecks, savings as mentioned) to make payments. Just my gut feeling, but why would you walk away if you still had resources left to pay it?

I guess if you were upside down by a lot and thought the housing market would never come back, you might.

I hear this argument repeatedly and don't buy it one bit. Any normal, rational sane person paying $5000/ month mortgage on a $700,000 loan realizes their new neighbor next door will be paying ~$3000/month on their $400,000 loan for an identical house, I don't believe there are many people who will happily keep paying the $5000 because they "can afford it" and be content to wait 10 years until the market comes back.But that's assuming the same interest rate is paid. What seems a constant is the total housing payment that is about equal to rent (despite booms and busts).

hope69 said:tooshy said:But that's assuming the same interest rate is paid. What seems a constant is the total housing payment that is about equal to rent (despite booms and busts).

That is true in a normal market.... Not so in some hot spots like Cali, NY, DC, FL. Also I would rather pay a higher interest rate than a higher price house. Rates will always go down.

did u ever see such a "normal market"? maybe just some urban myth, if housing payment is close to rent, who will rent....

chuzzlewit said:cameron2003 said:Interesting, but I doubt many people would walk away from their house if they still had liquidity (stocks, paychecks, savings as mentioned) to make payments. Just my gut feeling, but why would you walk away if you still had resources left to pay it?

I guess if you were upside down by a lot and thought the housing market would never come back, you might.

I hear this argument repeatedly and don't buy it one bit. Any normal, rational sane person paying $5000/ month mortgage on a $700,000 loan realizes their new neighbor next door will be paying ~$3000/month on their $400,000 loan for an identical house, I don't believe there are many people who will happily keep paying the $5000 because they "can afford it" and be content to wait 10 years until the market comes back.

I dont think its as easy as that to walk away. Im not sure about this, but I think your credit is pretty much ruined. You also lose your down payment. There are other reasons that make staying rather than walking away attractive. Im sure there are examples of major corrections (in your example its more like a bubble which is another question) where people could walk away in droves. What about L.A. in the 90s?

"Housing Market Cools in SoCal" LA Times 12 July 2006

"Southern California's housing market continued to show more signs of weakening in June as the median home price in San Diego fell for the first time in nearly a decade and sales tumbled in Los Angeles County, according to real estate figures released today.

The median price of all homes sold in San Diego last month sagged 1% from the same month last year to $488,000, according to DataQuick Information Systems, a real estate research firm. The last time San Diego County, which once ranked as one of the region's hottest real estate markets, reported a year-over-year drop in the median price was in July 1996, DataQuick said....."

Namlemez said:
My expense
$1900+190 (maintenance)+ $20 RE for 15years = $2210/month 30year mortgage + $130k down
My renter pays
$3100/month
$3100 - 2210 = $890/month = $10,680/year profit per year, which equates to 8.25% return on my 130k down payment.

Renter pays my mortgage, maintenance, RE and I get 8.25% return on my $130k investment. Not a "urban myth" to me

How about property tax on the place? Accounting for vacancy? Insurance? Income tax on the rental?

RE (Real Estate tax) = $20/month (15year tax abatement)already accounted on my bill above.
Vancancy? 2 year lease, need 15days to freshen up paint.
Insurance? included in maintenance
Income tax on rental? everyone pays income tax (140k on my bank is also subject to income tax)

it doesnt work that way.
Most home mortgages are tax deductible and you can get little creative with your rental thus avoiding any tax on rental.

I was talking about getting creative with $900 profit from rent - mortgage.
Thanks for clarifying the information though.