Home Buying in Toluca Lake>Question Details

Lostinla, Other/Just Looking in Los Angeles, CA

To buy or not to buy - and if so, what? Questions about first time home buyers looking for property in Toluca Lake/Studio City

Asked by Lostinla, Los Angeles, CA Mon Sep 26, 2011

Hello, my husband and I are new to SoCal and are thinking of buying property here. Some considerations -

1. we are first time home buyers in our late 20s/early 30s
2. we are not sure how long we will live in SoCal - definitely 2 years but after that will depend on jobs etc. We could see ourselves living here for 5-10 years but no gaurantee
3. we can't afford more than 500K for the property - preferably around 250k-300k
4. we would like a 2 BR/2BA or bigger and are open to condo/town home/single family home

I would appreciate it if you would let me know -

1. is it worth buying, given that we are unsure about our future in SoCal
2. given that renting a 2BR apt is $2200-$2600, how much would mortgage payments taxes be for a similar house we buy? ie. how would we fare monthly if we put down 20%
3. if we are to buy, condo or town house or stand alone house? which is financially better if we plan on selling soon

Your thoughts and professional advice would be much appreciated! Thanks!

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Answers

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BEST ANSWER
Hello,
I live on the Toluca Lake/Burbank town line, and the area you're looking in are highly desireable. Studio City and Toluca lake are near Warner Bros, and Disney, St. Joes hospital, as well as major highways that make it easier to get to downtown, Hollywood, and the Westside.

For easy math lets look at a $500,000 house with 20% down which means $400,000 mortgage. There are many very nice condos and townhomes available for $500,000, and fewer fixer type 2-3 bedroom houses, but at this price range generally need some serious remodel work. Assuming good credit that would provide a 4.5% interest rate your mortgage payment would be $2,026/mo. Taxes would be $5000/year or $417/month. HOAs, and Condo Insurance is extra for a condo/townhome which could be300-400/mo. This totals around 2,800 per month after the 20% down. There are tax benefits to consider which can reduce your payment using the mortgage interest rate tax deduction which is dependant on your tax bracket, but 500-800 per month is rough estimate based ont that $2,026 mortgage. In this scenario your payments if you bought are back to $2,000-$2,300/month. Renting a house, condo, or towhome for $2,000-$2,300 per month does not rent you as nice a condo as buying a $500,000 condo could get you in my professional opinion.

If you buy a condo/townhome you're living with people who generally stay put longer and seem to care more about their neighbors and the place they're living in since they own it.
If you remodel and change decorations you can first of all make the changes without asking your landlord, and when you sell or rent the place in 2-10 years you may recoup some of the costs in updating or painting.

Since we're bouning along the bottom of the housing market and nobody knows when it will turn around its tough to suggest buying with your 2 year timing, but with a 10 year range it makes more financial sense. The housing market will change at some point for sure, and when it changes rents will go up, over long period of time that's for sure. But Taxes due to prop 13 in California, and your mortgage payments on a 30 year fixed will remain the same, then drops in 30 years when it's paid off to just taxes, insurance and HOAs.

Renting is a good idea for a year to get a sense of what areas in LA you like, what your commute is like, and gives you a chance to figure out where you'd eventually like to settle. As a 20/30 year old buying a house is usually a good idea, and gives you a lot of benefits, as well as a lot of responsibilities. There's a lot to consider! I hope this helps!

Please let me knwo if I can help in any way.
Linwood Fullam
Rodeo Realty
818/207-0080
Linwood@Rodeore.com
DRE # 01895482
1 vote Thank Flag Link Fri Sep 30, 2011
Hi Lostinia,

I would have to be the devil's advocate here. Since you are new to the town and based on your predicament or concern right now, I would not advise you to buy.

Get yourself acclimated first to get the feel of the environment, community, lifestyle, etc. Once you feel comfortable about the transition, then the decision to buy would be much easier.

I am only being honest here because if you buy a house now and then after a year, you decide to sell because things do not happen the way you and your husband would like them to be, with the cost of buying and the resale value, you might not be able to recoup your investment.

However, this is just my two cents. I am not familiar with the SoCal market. Talk to a realtor and check where the price of houses in the area is going. Also, find out what your closing costs would be. The factors you have to consider are: closing costs on the purchase, potential resale value in case you have to move out in one or two years, commission on the sale of the house and closing cost on the sale of the house.

Best.

Maria
0 votes Thank Flag Link Tue Sep 27, 2011
Hi Lostinla,

There are quite a few variables that would need to be discussed in order for you to make an informed decision that best fits your specific situation.

I would love to either speak on the phone or, better, meet in person with you and your husband so we can discuss the pros and cons in more detail.

Please give me a call in the morning and we can discuss further. (818) 795-8474
Web Reference: http://www.anaconnell.com
0 votes Thank Flag Link Mon Sep 26, 2011
Hi and Welcome to SoCal. My wife and I specialize in helping first time homebuyers and we have many new homebuyers workshops. We recently listed and sold a great condo in Toluca Lake in your price range so you definitely have many options. Please feel free to browse our website to learn more about us http://www.philandjill.com Interest rates are also at historically low levels so we can refer you to some terrific lenders that could help. You are right that you could find a monthly payment that would be the same as rent. We'd love to help you more and send you any information you would like.
Phil and Jill Keppel
Media West Realty
http://www.philandjill.com
818-516-7387
jillkeppel@yahoo.com

DRE's 01875431,01868844
Web Reference: http://www.philandjill.com
0 votes Thank Flag Link Mon Sep 26, 2011
Lostinla,

If you would like to discuss these questions please give me a call directly and I can help you with these and other questions you will have along the way. There are benefits to both renting and buying and by getting the full understanding of the two it will help you make a qualified decision.


DOMINIC PIETRANGELO
KELLER WILLIAMS HOLLYWOOD HILLS
323.497.2596
dominic@kw.com
http://www.theurbanhomesgroup.com
dre#01860025
0 votes Thank Flag Link Mon Sep 26, 2011
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