Monday, July 25, 2011

Now really gambling

I am in process of buying house (A).

My thinking originally was we would buy a condo, put 3% down pay the PMI and get 5/1 ARM which would get me Mortgage payment ~$600 less than apartment wanted for rent if we moved to upgraded unit (which we have to do within a year or move out). Advantage was thought I could walk away saving a few dollars at expense of credit rating if housing market out here continued to plummet.

Problem with a condo is you never know what you are going to deal with as far as resident below or above you goes. My latest downstairs neighbor seems nice enough but he smokes about once an hour, his wife doesn't let him smoke inside and he has not adhered to my polite request to warn us when he is lighting up so we can close sliding glass door and windows for a few minutes.

I would rather have the brothel back downstairs than have apartment smell like cigarettes.

Townhouse has only 2 neighbors no one below so we have solved the smoke problem.

What I can't help but think is I own the downside risk of home price until down payment is exhausted and I also need price to rise 6% to break even.

Other risk is to choose 5/1 ARM at 3.375% or 30 year fixed at 4.625%.

3rd risk is that wife won't spend too much money once we are in a "home"

On positive side demon child gets to stay in same High School and would live closer to her BFF as well as my tax adjust cost of housing is fixed at ~ what I was looking at for rent in a year.

Tuesday, July 12, 2011

A Job Opening and real estate observations

My current job will probably have layoffs this months. A bunch of people accepted early retirement and I am not a numbers cruncher like some people but I assume that a one time write-off in the financial reporting will mean early retirements and layoffs will occur in same financial quarter.

Managers at work are going batshit trying to be make sure aspect of big project they are responsible for gets done ahead of restructuring makes work a little more stressful, but managers are always a bit stressed to make the deadlines that they had no clue how company could accomplish. Every engineering schedule is based on noting going wrong. My current project is first one that had schedule impacted by a tsunami.

I have decided with Timberwolves firing of Kurt Rambis I should apply to replace as I think it is nice raise and how hard can it be to do better than 32-132. Saying in baseball is team wins 50 games no matter what manager does, team loses 50 games no matter what manager does and it is other 50 games where manager earns his pay (154 game season made this saying a lot cleaner). Doing better than 20% seems trivial.

South Bay rental prices are a bit out of control. In general monthly rents are increasing by ~$400/month and a lot of apartments are refurbishing to add granite counters in kitchen as well as stainless steel appliances. I have no frkn clue why counter top and what surface you add art and notes to on refrigerator rates a rent premium.

My observation is washer/dryer in apartment is $400
Square footage over 800 is $20/sq ft/month
Granite + stainless is $300/month

Deal with current apartment is they want to jack rent $400/month but end of lease we have to either move out, move to another apartment in complex (that this year would cost $300/month more) or move out for a month where we refurbish.

This morning my wife tried to talk me into just sucking it up and renewing lease for year.

I countered with we should buy a condo a mile away because kid would go to same frkn bus stop and from prices I am seeing on zillow Mortgage + Insurance + HOA + Property tax would be $300/month less. I leave for work thinking it is no brainer decision and am frustrated wife is still arguing. Wife does decide when I leave for work go ahead and get condo if you want! I think this is case either where she has forgotten I do not understand subtlety or believes my trend of not paying full cable bill or cell bill each month has torpedoed credit rating.

At lunch I talk about condo pries vs. rental rates with co-workers. I work with engineers so OF COURSE none of us have wife's view of granite + stainless having any value.

Work hypothesis developed is people who paid $500-$600k for local condo are underwater and thus shortselling or walking away letting foreclosures happen since they can't refinance underwater properties and are now increasing rental demand. The math for buying these same condos in the $300-$400 range make it attractive for renters who can afford down payment to jump in.

This all prompts me to check credit rating, apply via web for loan pre-approval and try to find buyer broker.

I get home and much to my surprise wife has bought into idea with both feet and has lined up buyer broker. Little do I realize that her friend Sunny (who I have met) probably is involved in buying or selling house/month along my route to light rail station. I am quite oblivious but I swear her picture on real estate sign is a LOT different than she looks in person.

Sunday, July 03, 2011

Happy 4th

My wife finally decided it was okay to give away the family room furniture that has been sitting is storage for 5 years. 1st year was paid for by company that moved me down here which sadly enabled us to not make decisions that should have been made long ago. Clearing out a 10'x10'x10' space takes some time especially when mainly using a Prius to haul shit away but at this point I am probably 80% done and other than some golf clubs it is tempting to leave it unlocked and thank anyone that decides they want anything in there.

Best finds in the cleaning out are a bunch of old pictures:

This is from Kapalua in August 2008. In the golf cart are Rick Carlisle (driving) and Marc Ivaroni. They were going to Oahu the next week to help at Pete Newell Big Man camp and I was too much of a dumbass to get them to actually pose for a picture with me. At the time they were both assistant coaches in NBA but I talked to them more about ACC Basketball as I was at Tech when Rick was still at Virginia.

Wife and Demon child got to meet them as well as me and the Scottish gentlemen who I was paired with paid off our lost wagers (drinks afterwards I think only Scotsman had alcohol) as I think Rick shot just a few over par.