Moving to Orange County...help please!

[DisneyFF]

Just want to note that I’ve been on these boards since 1999, but I’m doing this anonymously since we haven’t accepted the job yet and haven’t told anyone in our family, etc.

DH has been offered a very good position with his company, but we would have to move from our home here in the Bay Area, where we have both lived our entire lives, to southern Ca. He would work from home part of the time and would need to be in the office in Tustin part of the time.

Given the traffic in the area, being as close to Tustin would be ideal but I know, even coming from the Bay Area, that we are going to have severe sticker shock with the home prices. We live in a relatively cheap county (given the downturn in the market you can get a nice house in a good neighborhood w/good schools for around $325k or so, whereas those same houses were around $700k before the market dropped).

I went to college in San Diego, but that, and our Disneyland trips, is the extent of my southern California knowledge. It’s intimidating to think about moving there, to say the least, but I know the DIS will have some suggestions!

We are first going to narrow down some areas and then check home prices, schools, etc. What areas should be focus our search on? A good school would be my priority (we have a 1st grader) and we’d even consider renting for a few years in order to get into a good school district (ideally we’ll move back up north after a few years, maybe 5?). If we set a house limit at $500k is that going to get us anything decent? I’m ok with small and old, but it has to be safe and again, has to be in an area with a good school district.

I was thinking about looking south on I-5 toward north San Diego county (I love San Diego and would move there in a second) but is that all built up and expense now too? DH’s territory would include San Diego, so he’d need to drive down there sometimes, but would a drive up to Tustin a few days a week be too much?

We truly have no idea where to start looking so ANY help or suggestions you can offer is really, really appreciated. Thank you!

 

[FlameGirl]

Good luck!

I was born in San Diego and would absolutely LOVE to live there again but it is expensive!

I realize I am no help whatsoever. Just envious.

 

[blackjackdelta]

I can not help, but welcome to the boards.. best of luck in house hunting.

Jack

 

[cyclenut]

First of all, check out the site GREATSCHOOLS.NET. It has scores, reviews and other comments of all sorts of schools. You'll want to look at the elementary all the way through High School, even though you are thinking of leaving before your child is out of 6th grade.

$500k should buy you a decent place 3 bedroom in a good area. If you want more, you'll have to look harder but they are out there. As with any home purchase, you'll need to consider all the costs, including home owner association dues. I prefer to avoid the HOA hassles and stay away from those areas that are governed by a HOA.

Commute will be a factor so you'll want to make your choices based on where in OC your DH will be working. OC is fairly spread out and could take you more than an hour to commute from one end to the other, depending on traffic.

On one end of OC are some great communities. Los Alamitos, Seal Beach, Rossmoor, Cypress and West Garden Grove (this is the 92845 zip code of Garden Grove) are all in the same general area and have different things to offer, depending on what you are looking for. Rossmoor homes can be VERY expensive, topping $1M in some cases. Los Alamitos and Seal Beach also have some very expensive real estate, but there are also more reasonably priced areas. Cypress is on the lower end of that same scale. West Garden Grove homes are less expesive but are smaller and tend to be older, but they also have a larger lot with most lots having some sort of RV access.

Contrast that with the other end of OC. Mission Viejo, Laguna Hills, Irvine, Trabucco Hills. Those areas tend to be more "planned" with HOAs being more prevalent. The homes tend to be newer and the schools tend to be very good. The price point of the homes can be a bit higher as well, but are typically in the same range as the Los Alamitos/Seal Beach communities.

The other area you may want to consider is Brea, Fullerton, Yorba Linda, Placentia, La Habra, La Mirada. Some areas within those cities are more run down than others, but they are all generally good choices. You'll just have to be careful when looking.

I know others will have differing views on this as people do tend to take a certain pride in the area they have chosen to live. You'll really need to take a look for yourself. Starting with the schools is a good idea though. If you choose a few schools throughout OC that you think fit your expectations, then go visit the school and the surrounding neighborhood to get your start. While your kid will be in elementary school, I'd start by looking at the high schools and then narrowing it down from there. As a general rule, a high school is good because the elementary and intermediate school are also good. Since the High School draws from a larger boundary, you'll get a better idea of what areas you would consider by starting at the High School level.

Notice that I didn't list many coastal communities above. Those can be good choices too but you start paying more for those areas than you get in return. Again, just my opinion. The inland area of Seal Beach is a possible exception.

Personally, commute time is huge for me. I try to live between 30-45 minutes away (one way) and no more. I'd prefer less, but that distance seems to be OK. Any longer and I think I'd had to find a new job. That would put you more in south county.

Hope this helps.

 

[Kathymford]

I completely agree with cyclenet FWIW. I'm from the South Bay (way too far to commute for your purposes), but lived in Orange County for a while (Buena Park, don't look there).

I would definitely agree that $500k should get you plenty in those areas listed. The coastal areas won't get you much (Hungtington and Newport Beach for example). But Cypress is nice, and I love Seal Beach.

So my pointless post is just telling you to definitely check out what the PP suggested. Good luck!

 

[DisneyFF]

Thanks for the well wishes everyone and thank you very much cyclenut for the GREAT information! It really helps me get a better picture of where to start. I really appreciate your time.

I'd love to hear additional options and suggestions...thanks again!

 

[cats mom]

I think your instinct to focus on areas as close to your DH's office as possible is spot on. Even though he won't be in the office full time, he will be there often enough that an ugly commute will make his life miserable.

I wouldn't stress too much about an elementary school, especially since you plan to leave the area in a few years anyway. It's not like the high school level where I might actually suggest choosing the school first and working backwards into housing from there. Of course you'll want to check out the school in any area you're considering before making a purchase or lease commitment, but there are lots of good elementary schools.

But since you did ask about school districts... Irvine Unified is probably the most coveted in the area, but you will pay for the priviledge of living within the boundaries. FWIW, even though it's very highly regarded, IUSD wouldn't necessarily be my choice for every student, even highly motivated ones, and if I had an average student I guarantee I would think long and hard before subjecting him/her to the pressure in that district.
Just a little op-ed note there.

And another opinion, which I'm sure plenty of peole will disagree with, but I'll put it out there anyway...

I'd think long and hard before buying if you think you'll be staying 5 years or less. Of course no one has a crystal ball, but IMO housing prices are still above historical norms (using both income and rent ratios they certainly are) Personally I think there's potential for more downside, and even if prices stabilize, I don't see some magical turnaround where RE starts appreciating in double digits anytime soon. Again, just my thoughts.

Good Luck with your search.

 

[DisneyFF]

Thanks Cats Mom for the info, especially about the Irvine district. I appreciate the help.

I was thinking it would be silly to rent considering how low the housing market is now, but I'm really basing that on what I know/hear/read about the market up here, obviously I need to do some more research on the market down there.

I've been doing a bunch of looking at real estate on line, what did we do before the internet?

Thanks again & more posts are greatly appreciated!

 

[sonnyjane]

Thanks Cats Mom for the info, especially about the Irvine district. I appreciate the help.

I was thinking it would be silly to rent considering how low the housing market is now, but I'm really basing that on what I know/hear/read about the market up here, obviously I need to do some more research on the market down there.

I've been doing a bunch of looking at real estate on line, what did we do before the internet?

Thanks again & more posts are greatly appreciated!

I guess I'll just give you the mandatory caveat about buying Make sure that your husband's position in the company is VERY secure and that you will indeed be there for a while, because yes, while housing prices are incredibly low for those that want to buy right now, that means if you have to sell your home for any unexpected reason, you're in a heap of trouble. A friend of mine recently relocated to North Carolina for his job. They purchased a house because the market was so great in that area. After FOUR MONTHS he was told he was being laid off and has been out of work for 8 months now, leaving his wife to pay their entire mortgage on her own. He accepted a job two weeks ago in Washington, D.C., but because they bought the home and the market is so saturated with low-cost homes, they can't sell it without taking a huge hit, so he will be getting a studio in DC while his wife stays at their house in NC. It is not ideal for anyone involved in their case. Unemployment here in SoCal is around 12-13%, so if something were to happen, you might find yourselves having a hard time getting another source of income, and I'd hate to see you in a similar situation to that of my friend!

You might want to enter a short-term lease for 6 months or even a year when you first move here and then you'll be able to investigate different neighborhoods in more depth that you could by doing so online from afar.

Just my two cents! Good luck!

 

[cats mom]

Thanks Cats Mom for the info, especially about the Irvine district. I appreciate the help.

I was thinking it would be silly to rent considering how low the housing market is now, but I'm really basing that on what I know/hear/read about the market up here, obviously I need to do some more research on the market down there.

I've been doing a bunch of looking at real estate on line, what did we do before the internet?

Thanks again & more posts are greatly appreciated!

I guess I'll just give you the mandatory caveat about buying Make sure that your husband's position in the company is VERY secure and that you will indeed be there for a while, because yes, while housing prices are incredibly low for those that want to buy right now, that means if you have to sell your home for any unexpected reason, you're in a heap of trouble. A friend of mine recently relocated to North Carolina for his job. They purchased a house because the market was so great in that area. After FOUR MONTHS he was told he was being laid off and has been out of work for 8 months now, leaving his wife to pay their entire mortgage on her own. He accepted a job two weeks ago in Washington, D.C., but because they bought the home and the market is so saturated with low-cost homes, they can't sell it without taking a huge hit, so he will be getting a studio in DC while his wife stays at their house in NC. It is not ideal for anyone involved in their case. Unemployment here in SoCal is around 12-13%, so if something were to happen, you might find yourselves having a hard time getting another source of income, and I'd hate to see you in a similar situation to that of my friend!

You might want to enter a short-term lease for 6 months or even a year when you first move here and then you'll be able to investigate different neighborhoods in more depth that you could by doing so online from afar.

Just my two cents! Good luck!

Regarding the statements I bolded above, I don't think I will ever acclimate to California attitudes about real estate.

Prices are down from the astronomical highs of several years ago, but they're still crazy high by any accepted measure I'm aware of, and yes that's taking the sunshine premium into account since I'm aware it has always been a given in most California markets.

While it's not perfect, and obviously you'll want to take a more in depth look at your own numbers and situation, I find this calculator to be a reasonably good tool to use for running quick rent vs buy comparisons:

http://www.nytimes.com/interactive/business/buy-rent-calculator.html

I seriously doubt you'll find much, if anything, well priced enough to buy assuming a holding time of 5 years or less. But I admit I'm not familiar enough with every segment of every So Cal market to know for sure. Some markets/segments have definitely corrected more than others.

I agree about the internet. It had to be sooo much harder to make a move before you could research so much online yourself. I can't even imagine!

 

[sonnyjane]

While it's not perfect, and obviously you'll want to take a more in depth look at your own numbers and situation, I find this calculator to be a reasonably good tool to use for running quick rent vs buy comparisons:

http://www.nytimes.com/interactive/business/buy-rent-calculator.html

What a cool calculator! I'm glad you posted it because it validates my current choice to rent I'd have to live in a home for 8 years before I would get to the point that buying would save me just $1,000 a year! Frankly, I don't know what I'll be doing in 8 years AND I'd gladly pay an extra $1,000 a year to know that I have the freedom to just break a lease if I desire instead of losing thousands in a bad re-sale!

 

[cats mom]

Yep, I've found the calculator to be pretty interesting. Of course it's relying on appreciation numbers for any calculation, and who knows for sure what will happen there, but it's easy to try lots of different scenarios. You can also personalize it quite a bit if you use the advance settings.

There are a couple of houses near me that are currently listed either for sale or for lease, and when I ran the default settings on them I got 18 & 21 years before buying would make sense. And given the realities of the market here, I actually think the default settings are slightly skewed in favor of buying.

Of course the key is to invest the money you save by renting so when it does make sense to buy, you're cash heavy.
I know that's easier said than done, especially in an expensive housing market, obviously rent in So California isn't cheap either.

I hope we're not discouraging you with all our discussion about housing prices DisneyFF, but as you were already aware, that definitely is an issue you have to consider here.

 

[DisneyFF]

Thanks again everyone & the calculator is very eye opening. I'm reading a lot about real estate down south and am finding that many think the bubble has not yet burst (prices will continue to go down), although I'm sure that I could find an equal number that say buy now. We certainly have a lot of researching and thinking to do.

 

[lcasa]

I live in Huntington Beach - which does tend to be expensive - but we haven't seen prices crash so badly around here, and they're starting to go back up ( have been watching because I'd love to help my kids get into something). Someone suggested that it's because there is only so much coastal property in the US, and even less with our weather. The take-away I think is it may be safer buying in an area nearer the beach. And I'd nearly always be worried about being out of the CA housing market once you're in it - I have a lot of friends who sold for out of state jobs and now can't afford to come back.

I work in Irvine and the commute can be awful, especially at night. Don't underestimate the value of spending less time and $4 a gallon gas ! As someone else said the problem with the south county communities can be the HOA fees - and in newer areas the Mello-roos property tax. There are really nice areas but also some bad ones in Tustin -- be careful! Unfortunately Redfin and the other on-line sites don't warn you about that.

Maybe San Clemente would work? There's a toll road that might make it accessible for you. nice, cool - closer to San Diego.

 

[cyclenut]

Thanks again everyone & the calculator is very eye opening. I'm reading a lot about real estate down south and am finding that many think the bubble has not yet burst (prices will continue to go down), although I'm sure that I could find an equal number that say buy now. We certainly have a lot of researching and thinking to do.

A word or two about the market here in SoCal.

There are definately pockets where there is a glut of homes on the market and prices are depressed and may even go lower as foreclosures hit the market. There are also those who look into their crystal ball and think that the younger kids entering the market today are not interested in single family dwellings but are more interested in what I'll call "high rise" living, more like what you find in Manhattan. I don't see that trend taking hold myself.

Whether or not to purchase is a very personal decision and one I waited on for a long time. Part of that depends on your relocation package and how good you think the job security is. It also depends on how good of a deal you get on the home you are buying and what sort of tax you might be subject to from the sale of your current home if yoiu don't put it into another home. I'm not a tax person at all, so you'll need to ask. It may not even bee a concern.

While I do agree with the PP that "Beach" communities have held their value better than those in the Inland Empire, I still believe you don't get as much for your money to start with and that is important to me. Also important is that there are a number of other communities further inland that have also held their value relatively well. That said, there is NO area that hasn't suffered pullback and loss of value.

Where are the markets going? Nobody knows for certain but the encouraging news is that while there are people who are saying the markets have more room to give, there are also signs of stabilization. One thing is certain, we are not going to see the "investment" market that we saw a few years ago. That was unsustainable. What is much more likely is that if you were to buy a home today, you'll be able to sell it in 5 years for roughly what you paid ... maybe a little more ... maybe a little less. That is especially true in the $450 to $500 k price point, where there is much more market stability.

The best thing you can do is keep doing your research. As I said earlier, those areas with a highly rated high school tend to have good "feeder" schools AND a much more stable housing market. Those things all tend to work together. It isn't an exact science, but its a good indicator as a first layer of screening.

As for south county properties, I really don't know that much personally, except I just don't like what Irvine, Mission Viejo and those types of areas have to offer. Some people love them. A coworker of mine rents a place in Aliso Viejo because of "quality of life" and then sits on the freeway for over an hour each way ... and still thinks it's worth it. Point is, it is really a matter of preference.