Mom, Home Owner in La Jolla, CA

Is it worth buying a 1 or 2 bedroom condo for our son who will be at UCSD for a 5 year doctorate funded program rather lose $15,000 a year in rent?

Asked by Mom, La Jolla, CA Tue Jul 19, 2011

Help the community by answering this question:


Probably not the best reason for buying property. In a declining market you can defintly lose more money than you're saving after depreciation of the collateral and after fees.
1 vote Thank Flag Link Mon Sep 26, 2011
in la jolla...not such a great plan. nearby though you will have better options. you can consider the areas of ocean beach, pacific beach, university city, linda vista, carmel valley and even mira mesa. if you get a two bedroom home you can easily rent a room. i just did a quick search and found four nice condos for less than $200k, one was a not far from the "other school in town", USD and was priced at $135k

whether or not you can finance it is a different story. loans are hard to come by these days and if you can pay cash the ROI on a lower priced home is WELL in excess of the rates you get on bank deposits and could easily beat your wall street type returns. you have a la jolla location in your posting...when he is done you are close enough to several good investments to make managing it do-able.

i m a long term bull on real estate and your use horizon, 5 years, is long enough to make it advisable.
1 vote Thank Flag Link Tue Jul 26, 2011

I have to agree with Santarosaguy. A loss of $15k a year may be far less expensive than the estimated 20% down payment $200-300 HOA fees, taxes, insurance and repairs. Not to mention the uncertainty of resale value. If you can find a unit priced way below value where you walk in with equity I'd say go for it. Or perhaps, a unit a short distance away where your son can commute by shuttle. All the advise posted seemed really good, I would just weigh all the pros and cons and try to decide the most cost effective, hassle free choice for you.

Best wishes to you both!
1 vote Thank Flag Link Wed Jul 20, 2011
You can "lose" $15,000 in rent or pay $20,000+ in interest per year plus a bunch of HOA's, insurance, taxes and repairs.

Choice is yours but I wouldn't touch a condo without a LONG expected duration.
1 vote Thank Flag Link Wed Jul 20, 2011
My daughter will be playing for the Tritons Water Polo team beginning this year! I own Top Coast Properties in La Jolla Shores, and I would definitely consider a 5 year window a good opportunity for a purchase provided your son has roommates and you can collect this rent. Zip Codes 92037 and 92122 should both be considered.

You may even decide at the end of the 5 years that this is an investment worth holding on to, renting it out even after your son finishes his program. I am going to consider this option for my daughter after her freshman year (I want her to have the dorm experience for a year first). Congratulations to you and your son and welcome to gorgeous La Jolla!

Cheri Sasson, Broker/Owner
0 votes Thank Flag Link Thu Jul 26, 2012
Hi Mom,

Congratulations to you and your son's acceptance to UCSD!

Just curious if you decided to make the investment?

Make it a great day!

Laura Kelley
Keller Williams Realty
0 votes Thank Flag Link Tue Jul 24, 2012
The only profitable way to buy a property for a student is to buy one with several bedrooms that the student can rent out. He/she not only gets a little business experience but Mom will likely break even. Good Luck!
0 votes Thank Flag Link Thu Jul 28, 2011
I would say it would be wise for the 5 year investment.
You can also continue to own it after that as a rental.
We are in a down market and the rent of 15,000 will be going up as will housing prices.
There are things to consider like HOA issues, and making sure you can sell the property down the road as in any purchase.

Harold Sharpe - Broker
So Cal Homes Realty
(951) 821-8211
California Department of Real Estate Broker License # 01312992
0 votes Thank Flag Link Thu Jul 21, 2011
this is a question many of my clients have asked. I agree with the other agents in that a 2 bedroom would be better - share the costs. I also agree that you need to discuss the tax benefits with your accountant to see if that would make sense to you as an investment property.

The least expensive 2 bedroom in the UCSD area is around $300,000. That should help with your calculations. HOA fees are around $200-$300, plus property taxes estimated at 1.25% of the purchase price.

I would suggest that if you purchase a condo that you do so in the UCSD area of La Jolla/UTC. There is a free shuttle for the students which is really a benefit because parking on campus is difficult. Students like the close proximity to school.

Thank you and good luck to you and your son. Regards. Maria Weiss, Coldwell Banker, 858-248-0863, DRE License # 01368844
Web Reference:
0 votes Thank Flag Link Wed Jul 20, 2011
In San Diego county rents are high and vacancy is low; you need to do your calculations but in general purchasing right now would be better, in my opinion, than renting. I would suggest that you purchase a 2 bedrooms unit because it will resell more easily. I would suggest that you work with a Realtor familiar with the condo market and financing who will direct you to the best condos available. While the area around UCSD is in high demand, the same is not true of all areas and all condos in San Diego. Owner occupancy and HOA solvency are two of the things to pay attention to in buying condos right now.
Web Reference: Http://
0 votes Thank Flag Link Wed Jul 20, 2011
Hi Mom!
Congratulations- how exciting! In my opinion, this would be a great option for you. Prices and interest rates are extremely low right now and you're absolutely right- why pay someone else's mortgage? Plus, when you son does graduate, you can either sell it or rent it as you know the rental market in that area will always be hot from the University. There are a bunch of very cute condo complexes I would love to show you. I have worked on a lot of Villa La Jolla units, which are very competitively priced. Let em know if I can assist.

Sinead McAllister
McAllister Homes Real Estate
0 votes Thank Flag Link Wed Jul 20, 2011

Congratulations on your son's success. It would be a good idea to look for a 2 Bed/2 Bath . It would give your son the option of taking on a roomate (additional income), or if your son eventually moves on, and you need to hold the property - you have the option of converting it to a rental until the market improves. You may also sell with profit/loss - whatever is more advantageous at the time. Consulting your advisors (Tax, Financial, Real Estate) is important in deciding if it is worth it for your family as there are many factors to consider.

Kind Regards,

Marcie Sands, REALTOR
Simply The Best Real Estate Co., Inc.
0 votes Thank Flag Link Wed Jul 20, 2011
The condos along the I 5 corridor near UCSD are some of the best values in the La Jolla Zip code. The location being near all of the shopping, movie theaters and restaurants make it so convenient for a college student as well as subsequent renters should you decide to keep the home after 5 years. UCSD, the VA hospital as well as vacationers should provide a steady stream of rental income. I am happy to provide you with homes in that area that are on the market as well as current rental income for the condos.

Congratulations to your son on his achievements!

Lenna Doyle
Pacific Sotheby's International Realty/La Jolla
0 votes Thank Flag Link Wed Jul 20, 2011
This may be a good option for you. There may be some tax advantages for you as well, talk to your accountant about that. A 2 bedroom would be better, in my opinion, because your son could get at least one roommate and after 5 years if you decide to sell, the market is usually better for a 2 bedroom than a 1 bedroom or studio condo.
More than likely you will have to put 20-25% down on an investment property. You can check with the lenders at this link (… ) to see what the requirements are for this.
No one can predict what the market will be like 5 years from now but you may realize some appreciation if you decide to sell the home after your son graduates. My website has a search engine that can help you find what condos are available in the areas surrounding UCSD.

Jerry Heard
Your Broker
The San Diego Property Shop
Direct 619-920-9796
Office 619-269-5545
Fax 619-269-9168
CA DRE #00648687
0 votes Thank Flag Link Wed Jul 20, 2011

The first thing to do is to talk to your accountant. It is fairly easy to use the internet get an approximate price on a condo to give to the accountant as a cost basis.

They can best advise you on the financial picture and the tax ramifications of what you are looking to do.

From a real estate perspective, you have to consider what you will do with the property 5 years from now. If the answer is sell, no one can predict where the market will be in 5 years so you have to be prepared to take a loss or break even on the investment in your son.

Best of luck to you,

Mark & Kari Shea
Shea Real Estate
0 votes Thank Flag Link Wed Jul 20, 2011
I would suggest a 2 bedroom so he/she can have a roomate to help pay the mortgage and taxes. I think your best ROI will be in a unit like 1780 S. El Camino Real Encinitas, CA 92024. Maybe 7535 Charmant Dr. Run the other direction anyone ever tells you investing in anything is a guarantee. But, I believe this will be a good play. In 5 years I think rents will be higher and if you can get the rents to cover the principle, interest, tax, insurance, HOA you can keep it as a rental even if it hasn't appreciated considerably. The depreciation write off will be nice too.
0 votes Thank Flag Link Wed Jul 20, 2011
with 5 years to wait, you are almost guaranteed of some appreciation, and at the least you will have the tax deduction and the opportunity to work on your own house, instead of someone else's condo.

Good luck and may God bless
0 votes Thank Flag Link Wed Jul 20, 2011
I've been working with a two families who are doing exactly the same thing. There are some benefits, but also some challenges when doing so right now, depending upon the property you decide upon. Generally speaking, it costs just about as much to own as it does to rent right now.

I would be happy to discuss our recent experiences with you at your convenience.

Best Regards,

Mark Stuart
Prudential California Realty
0 votes Thank Flag Link Wed Jul 20, 2011
It all depends on the area and price point your are looking to
purchase. If you were to buy in the right area I would say that yes you could come out a lot better with a good ROI on your investment, since rates and prices are still low. You can visity my site to start your search and get local markets reports in
the area you are interested in buying in. Thanks and have a great evening!
0 votes Thank Flag Link Tue Jul 19, 2011
Search Advice
Ask our community a question
Email me when…

Learn more

Copyright © 2015 Trulia, Inc. All rights reserved.   |  
Have a question? Visit our Help Center to find the answer