Home Buying in San Diego>Question Details

Frank, Home Buyer in San Diego, CA

Moving PQ/RB area for 4 yrs. I do not intend to stay , should I rent or buy? 1st time buyer VA Loan 250k range.

Asked by Frank, San Diego, CA Mon Jan 28, 2013

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Frank, I don't know what you are going to decide, but I wanted to drop a line and vouch for semper fi homes. They do a phenomenal job for veterans both in the real estate arena as well as helping veterans charitably.

I am not affiliated with them in any way, but if you have questions, they are a great resource...
1 vote Thank Flag Link Mon Jan 28, 2013
Va loans are at less than 3.25%, housing on an upswing. With 100% financing you might even cashflow positive should you decide to keep it after the 4 years.

As a fellow veteran, I would buy... If you have any specific questions or would like a rent vs. own scenario with VA specific loan information, drop me an email and I will shoot it out to you...

Thanks, and thanks for your service...

Daniel Lehman
WJ Bradley Mortgage
1 vote Thank Flag Link Mon Jan 28, 2013
If you think home appreciation will cover the transaction costs, or you are willing to become a landlord at the end of your stay, then I would buy! Otherwise, renting is the simpler way to go!
1 vote Thank Flag Link Mon Jan 28, 2013
Interesting question. San Diego county has such valuable real estate, that if you did buy, you could easily rent the property once you left. Also, with sales prices starting to climb, I think you're definitely in the right time frame to make a profit on your investment in 4 years. Of course, renting is certainly an option, though in that part of town, rents are pretty high. I hate to sound like an agent pushing you to buy, but we are definitely at the bottom of the market right now, which means you're very likely to have a profitable investment if you purchase. Valerie Stiles 619-825-0001
0 votes Thank Flag Link Tue Jan 29, 2013
Hi Frank,
To address your question, I would need to know a little more about what you intend to do in four years. Chances are, with prices low now, your new home will appreciate. Will you sell it or rent it? I would lean towards buying versus renting, for many of the reasons my colleagues below have listed. However, it only makes sense, if it makes sense for you. :)
Secondly, if you do pursue buying you need to equip yourself with the right tools. Namely, an experienced real estate agent who knows, 1)How to make sure that the property you are interested in is VA approved 2) How to negotiate to get your VA financed offer accepted over other offers that are cash, etc. The market is very competitive right now, inventory is low, especially at your price point, so you will need to form an alliance with a great real estate agent to go into battle for you! :)
Of course, I can be that agent. If you need any additional assistance or have any further questions, I would be happy to help you.

Sinead McAllister
McAllister Homes Real Estate
0 votes Thank Flag Link Tue Jan 29, 2013
Hello Frank,

Since real estate prices in California are probably as low as they will be for the foreseeable future, I would buy if I could. In the next few years real estate is predicted to be in an up-cycle and you should be able to gain some equity, sell the property in 4 years and move on to the next location. Or....you could begin your real estate investment portfolio with a nice rental property with a cash flow.

By buying now your monthly payment with today's low interest rates will be less than what the rent is in PQ/RB. As a San Diego native and loan officer for over 23 years I have seen many, many real estate cycles and buying a home would be a smart move in this market. Contact me with any questions and I will make sure you are properly pre-approved for a VA loan.

Michele Kole
Land Home Financial, Inc
0 votes Thank Flag Link Mon Jan 28, 2013
Be sure that if you do buy with the intention to rent when you move, that you'll at least have break even cash flow. Not all purchases make good rentals.
0 votes Thank Flag Link Mon Jan 28, 2013

Homeownership has many advantages, specially the chance to have the home act as an investment account with appreciation, you will have a nice tax shelter (consult your cpa) and the freedom to do what you want. If after 4 years, you want to keep it as a rental, good, if you want to sell, great as well!

I feel the worse thing you can do is rent.

Hector R. Gastelum
Candidate for California State Senate District 40
& Realty Executives Dillon
REALTOR #01382940
2240 Otay Lakes Rd. #306
Chula Vista, Ca 91915
efax 619-270-2516
0 votes Thank Flag Link Mon Jan 28, 2013
Hi Frank,

Great question! It depends. On sooo much. Real Estate is generally a long term investment and it works best to consider it as such. You are just on the cusp of that. Generally, I would advise my clients to hold their property longer than 4 years to benefit from the build up of equity over time. However, I'm assuming you are a younger person in the military, recently, or soon to be seperated from service. As such, making use of your VA benefits now as opposed to later may be ideal for you. One of the newer condo developments in the area would give you an "apartment" to live in while you are here and with the restrictions on closing and loan costs to service members your cash outlay would be about the same as security deposits. The key I would think would be to find a property that has added value in it's design or amenities that would make it a good option for as large a percentage of possible buyers in the future. In other words, buy with an eye to what would most people like, not just what you would prefer.
The other more difficult and most important consideration in the rent vs. own formula is to find a property at a price good enough to allow some cash out equity in 4 years. There's no guarantee in this part, but you have a wonderful opportunity to make the most of your VA benefits.
I'd love to help you find a suitable property. Please give me a call or send me an email and we can discuss your questions and criteria in further detail.

Best Regards,

Maureen Hanley
0 votes Thank Flag Link Mon Jan 28, 2013
All good answers from what I've read. I'll add this: I know you may think its only 4 years, but assuming you rent a place at $2000 a month, multiply this times 48 months. You'll spend $96,000.00 over the course of your lease term towards your landlords mortgage. That money could going towards YOUR mortgage. And like what has already been said, the interest so low right now!
As for finding something in that area for 250k, its probably not going to happen. However, if you can handle the commute, we have homes in that price range in the Temecula/Murrieta area. Its a straight shot up the I-15 and if you leave in 4 years, you have instant rental in your portfolio.
0 votes Thank Flag Link Mon Jan 28, 2013
I would buy without hesitation...and I am. Mortgage rates are at historic lows which equates to about one third of your monthly mortgage payment going to principal paydown. Contact me and I will show you. Besides...the risk of property values is much lower as the prices have been beaten down after the housing bubble popped. Property values are biased to move upward from here since the banks are not holding tons of foreclosed inventory and short sale activity is slowing down.. Meaning there isn't a ton of inventory slated to flood the market. The only thing I see that can cause numerous homeowners to sell would be a hit to the economy which seems to be doing ok.

I would love to have a conversation with you. Call me at 619-888-1688 for more details.

Take care,

David Crowell
RE/MAX Solutions
Realtor, SFR, CDPE, CIAS
DRE Lic# 01846329

0 votes Thank Flag Link Mon Jan 28, 2013
Hey Frank:

I don't care what anyone says, when and what to buy is a case by case and personal decision. Now may be a perfect time to buy for some, but not for others. It depends upon your situation, your needs, and your objectives.

In some respects, it depends on what you want to live in for those four years. $250k today will fetch you an 1100 square foot 2 bedroom/2 bath condo/townhome in that area. One thing to remember is that the HOA and other monthly fees knock down how much you can qualify for - they seem to range from $200-400 per month. There is not a whole lot to choose from right now and many are short sales, so you will be waiting a bit before you can actually own the condo you are successful in getting your offer accepted.

If you have large dogs, then maybe a condo isn't an option for you.

The downside with renting is that you could be asked to vacate at certain times during that period and have to find another place.

Is it practical for you to become a landlord after those for years? That has to be a consideration if the market doesn't go your way if you buy. However, as Alisha points out, with such low interest rates now, it is hard to imagine that rents won't cover your costs in using a place as a rental moving forward.

For me, I am a buyer. I like the stability that I feel owning as opposed to renting. But that is just me.
0 votes Thank Flag Link Mon Jan 28, 2013
With VA programs my preferred lender currently offers you can pay zero to little closing costs, rates at 3.5 and homes prices still low across the county ..I say there's never been a better time to make that move..if you're seriously considering making a purchase..I wouldn't wait and miss this opportunity! Great time to buy..as he said below ..cheaper than renting! I can help in that area if you're interested give me a call. Thank you.
0 votes Thank Flag Link Mon Jan 28, 2013

The first question is what type of home could you be approved to buy, and you could determine this by obtaining a pre-qualification through a VA lender. As a direct VA lender, I would be happy to help you out with this.

Right now in San Diego you can purchase a home for less than you can rent a home for in most areas. There are closing costs to consider, but those can mostly be covered through closing cost credits.

In 4 years you have the option of selling your home, or renting it out to cover the mortgage if the housing market has not appreciated enough to cover the cost of sale and mortgage payoff.

If you 'd like to discuss this further, you can call me at 858-229-5399, or check out our web site listed below.
Web Reference: http://www.guildMESAsd.com
0 votes Thank Flag Link Mon Jan 28, 2013
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