Housing Market - Specifically Southern California

[sentradude]

So, I am sure there are a lot of investors, maybe a few realtors and lenders that are on this forum. Wondering what everyones take is on todays housing market? As rent keeps going up and homes are become less affordable - makes me think we are in for another housing bubble? Maybe not as severe, but it sure feels like. So just wondering what everyones thinking, bubble? No bubble? If bubble, how long etc? Have a great day!

[S14kouki805]

Hmmm, interesting...

My first thought was that we are in a small bubble. Rates have gone up a full point since Trump got into office, that has softened the housing market and as interest rates increase (as predicted) throughout the year I believe IMHO that home values will soften.

Tension in the US and worldwide as well as imminent threat of war will definitely impact the housing market. It is a very turbulent time to say the least. My gut tells me to wait on making my next purchase. If rates continue to increase you will see prices fall.

At the advice of my CPA, it is better to purchase at a lower value and higher rate since you will be paying on a lower principal balance. If and when the rates drop again you will be in a better position to refinance since your loan to value will be lower.

Just my 2 cents for whatever its worth

[spooled240]

Originally Posted by S14kouki805

At the advice of my CPA, it is better to purchase at a lower value and higher rate since you will be paying on a lower principal balance. If and when the rates drop again you will be in a better position to refinance since your loan to value will be lower.

I was just talking to a buddy of mine about this and thought the same thing. I haven't ran the numbers, but it makes sense. You can refinance to get a lower rate, but you can't refinance your balance to a lower amount.

[ZenkiKid]

Originally Posted by S14kouki805

At the advice of my CPA, it is better to purchase at a lower value and higher rate since you will be paying on a lower principal balance. If and when the rates drop again you will be in a better position to refinance since your loan to value will be lower.

Just my 2 cents for whatever its worth

This is great advice. I WAS thinking about buying this year but the prices where I live (San Diego) are outrageous. Its really telling when a Loan Officer tells you straight up that its a tough time to buy right now.

(I have amazing credit and good DTI ratio for those wondering)