In the outlying burbs of LA, you can see the meltdown. New homes going up for 600K, and others around it for sale/foreclosure/repoâ€™d/quick sale for 375kâ€¦.you know someone is taking a butt kicking. But idiots keep buying!
If you make 200k a year, get a house WAY out and commute. Or, rent.
It seems like you do not like the answers and you are shooting the messengers. There is no secret. You want to live in a beach community in California, you gotta be loaded. You do not have money, then maybe you want to try renting (though is still very expensive).
Artificially low interest rates, low inventory (due to new restrictive foreclosure policies and cost and difficulty to build new) and prop 13 also keep California home prices artificially propped up higher then they should be.
I see that the responses you got all came from realtors and I was hoping to see more feedback from real buyers. Iâ€™m afraid there wasnâ€™t anything very useful in the feedback I saw. But donâ€™t let the negativity from some accusing you of not doing your homework affect you. This market has changed drastically within the past few months and even professional realtors are surprised by this hot market. And Iâ€™m sure you already knew ahead of time that the standard of living in Southern California is vastly different than Texas before you moved. I wish us both luck in home buying search!
Though $200k income takes you a long way in Texas...in Los Angeles it does not in terms of buying a home. Most people in LA bought a long time ago or inherited a large sum to make downpayments...
To get the standard of living you want, you probably need to make double what you are making now or have a $599k downpayment. As crazy as it seems, I represent people buying and selling multimillion dollar houses all cash quite often. All I can say is welcome to LA -What's your dream?
Lets just say for the sake of answering your question, a buyer using 3.5% down on a house priced at 700k would be looking at a payment of around 4,100 per month est. To qualify for a loan, this hypothetical buyer would need to bring home at least 10k a month. Other agents may disagree with my math and that's fine, but I guide buyers with a conservative route towards their purchase so that they are not merely working to keep up with payments.
Now I would recommend expanding the area you are looking in. Depending on where you work there are some really great options at that price range that won't leave you feeling like your getting a dump.
Good luck and happy house hunting!
As far how much the average home buyer in L.A. makes and their occupations - I would have to Google that but much of the higher end jobs are executives, self employed, film related - whether it is acting, production, etc and technology jobs - from website/internet design to game creation as well as Government contract for engineers for military equipment etc. Granted, this is just a rough summary but it gives an idea.
If you are currently living in the immediate Los Angeles area you may want to consider looking into San Fernando Valley area. You will have to contend with the commute, but you may be able to find a more affordable home that can suit your needs. In actuality, your combined income and lack of debt puts you high above most California residents. It is a very different lifestyle here and way of thinking in regards to money compared to most of the U.S. I'm still getting used to it after 20 years.
Do you just want to vent?
Are you angry that you didn't do some research before you moved?
Do you think that knowing the answers to your questions will solve your problem?
A lot of those residents have owned the house for a long time.
A lot of those people make more than you.
A lot of those people are renting?
A lot of those people are in serious trouble with their mortgages.
A lot of those people have a 2 hour commute to work.
It is, what it is.
Other than that, have you thought about looking for a townhouse? You would be able to get more for your money, and town homes are most similar to single family residences, but generally cost less.
Here are the major reasons:
1) adjustable rate mortgages allow buyers to cut their payments by 1/3 or more (they will be sorry later when their payment resets).
2) 25% of properties have been bought by investors who hope to make a quick profit. They are asking for 20% or more over what they paid despite only owning the place for a year or less.
3) Many people bought these properties in the 80s and early 90s when prices were more reasonable. Now prices are ridiculous.
4) There are a lot of high income earners in LA.
5) Many inherited money or were given money for a large down payment by their parents.
Many families have two income earners which helps with the mortgage payments. The down payment can be a gift from the family of the buyers.
I realize it must be very upsetting coming from an area such as Texas when you see what your money will purchase here. If you research this, many major cities are very expensive, San Francisco, New York and others.
Some buyers will move to suburb areas where housing is less expensive. There are some lovely homes in Valencia and Santa Clarita and they are in the 400's for a new home.
There are some areas that are more reasonable then others. You need a really good Realtor to assist you.
In Va our home is on 5 acres, 6000 sq ft home, it's with about 950 now. Our mtg is 3500 and my dh makes over 500k per year. we have 6 kids and 2 dogs . I've lived in San Diego, OC and Santa Barbara. We can't afford to move. I'd love to live in Santa Barbara but a home with no land and 1/3 the size of my current home is 1.4 million. If we move down south, I'd only want to live in Seal Beach, Hermosa...small beach communities.
So, I wish real people with real situations would answer your question as well. Seems as if the only options are to live pay check to pay check or rent. Neither of these options seem viable to me. But who knows I am desperate. And perhaps that is the key... Once you've lived in California, you never want to leave and that makes up for everything else.
On a home in the upper 400â€™s, after taxes, insurance, HOA fees, possible school bonds, etc., look at above 4K a month for a homeâ€¦I donâ€™t know what the Relator below is smoking saying 4100 will pay for a 700K home! LOL.
Rent a small crappy apt. or get ready for a LONG commute out from a crime ridden city if you want to buy a home and actually keep it. LA is insane. 100K here has the buying power of 29.5K in Texas. Welcome to the intro level pay scale in the land of fruit and nuts.
However, on the bright side, post melt-down prices never touched LA. So, if you do buy a 750K 1906 home, you will get your return on investmentâ€¦.that isâ€¦.if you can keep it!
There are some options in the Greater LA area. Which part of town are you wanting to buy in?
Once, you let us know where you're interested in buying, a realtor that specializes in that area is your best option.
For example, I specialize in the Westside, Pacific Palisades, Santa Monica, Brentwood, Westwood, Venice, Marina Del Rey, Playa del Rey! & Westchester.
Although, I'm familiar with some other areas, because I've been an investor for 12 years.
RealtorÂ®, Certified HAFA Specialist (CHS)
Coldwell Banker Residential
Tel. (310) 463-8088 http://www.douglaslagos.com
It also looks like prices are increasing, there for - right now is pretty good time to buy.
I'm not sure about Texas, however there are different cities and counties close to Los Angeles where you can purchase property for less than Los Angeles - for example San Bernardino county, Riverside county, Kern county, etc...
There you have some options - and if you need to buy closer to LA you may consider San Fernando Valley, San Gabriel Valley, and other cities where I can locate properties for you at a lower price.
Hope this info will help you!
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While this is clearly a tough transition right now, I can tell you that 5-10 years down the road, it will seem easier for you. Salaries tend to be higher in California and unfortunately, so is the cost of living.
For now, you may have to rent, or live in a much smaller home than you had dreamed of. Hopefully, you moved to LA for some really good reason, and will have opportunities to move up in your housing at some point.
I grew up in midtown but live in the San Fernando Valley now and love it. Less traffic, less congestion, some breathing space.
You are going to have to pay market price wherever you choose so decide what factors are most important, how much remodeling you are willing to do and look there.
The sellers aren't kidding anybody with the asking prices. They're asking that much because that's what the market will deliver. Sellers aren't all randomly putting up crazy prices that won't result in a sale.
The average buyer in your price range makes $150K a year. There are tens of thousands of jobs like that. Since prices have come down from the peaks, homes are now more affordable and people are buying.
Texas (even in Dallas, Houston, Austin. San Antonio, etc.) is notorious for low home prices, but the property taxes are extremely high.
But in the the end, moving to LA is a wallet shock, especially from Texas where housing is so inexpensive in general. You have to stretch yourself, over time it eases and you get used to it.
I lived in Minnesota for 2o years/ I sold a 4 bedroom, 2,300 SF house totally remodeled and updated for $425,000. I came to LA and ended up buying a 1,500 SF fixer upper for $500,000! Those are just the realities.
I too don't understand how $250K a year can be considered rich here.
If you want to speak with a qualified loan officer about your loan needs, I can recommend Bridgette at WestCom Lending (818) 335-0283 / email@example.com
All in all, location is key in finding a home that is for you. Maybe try searching a slight further commute to work to have the luxury home you want. Any questions, feel free to contact me.
8700 Reseda Blvd., Suite 213-B
Northridge, California 91324
(818) 967-9626 mobile
(818) 979-0226 fax