We are off to a very interesting year so far in 2009! In many ways there are a lot of changes and uncertainty in this market. However, these are the times and circumstances that create amazing opportunity for those that are willing and able to make decisions and take action.
One interesting observation is that in 2005 when buying real estate was “the thing to do” everyone was willing to buy anything they could even if the numbers, affordability and fundamentals of buying didn’t always line up. The truth is NOW is the best time to buy property in San Diego and the fundamentals are in line for buying vs. renting and investment properties yield a positive cash flow. All of this with safe, secure conventional financing.
In addition to all of this the new stimulus package allows for up to an $8,000 First Time Buyer Tax Credit…NOT just a deduction.
Here is a quick snapshot of some examples and what we are seeing in the market.
Owning Vs. Renting
January 2009 median price for a single family house (not condo) was $325,000. (See Report Below)
Purchase Price: $325,000
Down Payment: $ 32,500
Mortgage: $292,500
Payment: $1,570.00 5% 30 Year Fixed
Mtg. Insurance: $ 170.00
Taxes/Insurance: $ 400.00
Total: $2,140.00
Tax Savings: $ 430.00 25% Tax Bracket
Principal Reduction: $ 351.00
Net Cost To Own: $1,359……..This is much less than it would cost to RENT. You also could qualify for the $8,000 credit right of the top of your taxes in 2009!! Plus the long term benefit of appreciation. YES, at some point prices will rise again!! Believe it or not we are not slipping into the oblivion or the Pacific Ocean.
On investment properties we are regularly seeing at 10% Cash on Cash Return, plus principal reduction and appreciation.
Good properties are selling very quickly with multiple offers and it is critical to have financing secured and work with professionals that know how to find deals, present and negotiate offers in THIS market.
I have included a current Market Trends Report below and some great properties we have come across.
Property Searches – Featured Properties
Filed under: Market Update - Stats Tagged: | Financing, foreclosures
