Prolegomena. My name is Tim Trainor. The goal of this blog is to be informative. I will use this space to write about my experiences, real estate in Corona, CA, finances, non-profit organizations and my life in general. My hope is that you would return to this page in an effort to learn more about my practice, as well as more about me. The initial focus is going to be on real estate, because it is such a relevant topic and because this is where my business is focused today.
So, we have a stimulus package that is in front of the Senate (60-38 with 3 GOP votes). They are voting on it as I write. I thought I would put a few notes about the package. Read all about it here - stimulus.
Passed in the house 246-183...with no GOP support
$787 Billion total cost
Will raise national debt to $12 TRILLION!!!
Temporary AMT relief
$800 payroll tax cut for married couples, $400 for individuals, $250 for vets who do not get the $800 cut
$59 Billion for unemployment aid
$29 Billion for highway construction
$15.6 Billion for tuition aid
$11 Billions for new electrical grid
$8 Billion for mass transit
I will offer my insights (opinions) about the stimulus after it passes the Senate (although, I was listening to a Senator today who said that his office received the 1,400 page document after 11pm last night - exactly how is any Senator going to be able to know the scope and nature of the stimulus package having that large of a document less than 24 hours?). Everyone thinks this is a done deal (since we are clearly a partisan Country).
SIDE NOTE: Citi, Chase, B of A, and Wells Fargo (added to Fannie and Freddie) have decided to freeze all foreclosures until March due to a housing recovery plan that Obama's administration is presenting next week (more on this once it comes out).
In order to determine the car expense, I calculated the distance from the house to the "work" site. I then figured out the monthly expense for fuel. The problems with this was 3 fold:
1. It did not take into account the wear and tear on the vehicle. 2. It did not take into account the cost of toll roads. 3. By calculating only fuel the costs were VERY close. For example, the closest home was in Irvine and fuel costs per month was $14.66. The furthest home was in Corona and the fuel costs per month was $131.02 per month. Making the difference only $116.36.
Therefore, I decided to see what the difference would be if I calculated at the mileage reimbursement given by the Federal Government. Using the above example, the per month car expense for Irvine is $84.37, and the per month car expense for Corona is $861.96. The Corona expense also got bumped for the cost of using the toll roads daily.
The only city that comes close to Corona in monthly cost for housing and car is Santa Ana. However, to get that home in Santa Ana (which I am not saying is a bad area - but it ain't the best) you have to put out $22,000 more in downpayment. Which isn't so bad...because that nets you an internal rate of return of 10.9% on your monthly savings.
All of the other cities are not even close. The reality is simple, in Corona you will get a lot bigger bang for your buck than you will of any of the cities I looked at in Orange County except Santa Ana. The other factor that was not included in this study was HOA. The vast majority of all homes in Orange County have an HOA. In fact, a large portion of Irvine has HOA's in excess of $400 per month.
I am not going to go as far as to say that Corona is the center of the universe, but it is a very viable option for those living in the O.C.
So, every other Tuesday a lovely lady comes to clean our house (this is a requirement of my wife working full time). She prefers us to not be home...so Mac and I usually go to the bear place (Hunney's Restaurant) for breakfast. A couple weeks back I was reading an article in the Orange County Register - I know print is dead, but I had nothing else to do for 3 hours. But, I digress...
The article basically said it doesn't make financial sense to live in Riverside County when you work in Orange County. Now, the author of this article not only had a certain amount of snobbery in their writing, but they also lacked the ability to do simple math.
So, I decided to open the MLS, google maps, etc...and see what the actual numbers looked like. Here are the constants for my experiment... Work address: 17951 Macarthur Blvd, Irvine, CA Downpayment: 20% Interest Rate: 6.5% Mileage: $0.545 (current mileage reimbursement by the Federal Government) Car: '09 Mercedes Benz C300 Sports Sedan (26 MPG highway) Premium Gas Price: $2.47/gallon (Chevron as of today)
The City's looked at:
1. Aliso Viejo 2. Costa Mesa 3. Irvine 4. Newport 5. Tustin 6. Villa Park 7. Santa Ana 8. Orange 9. Rancho Santa Margarita 10. Corona
These homes are average...they are obviously not the top of the market, nor are they the worst houses available.
The homes:
31 STONE PINE Aliso Viejo $599,000 4 3 2108 2513 Colby Place Costa Mesa $509,900 4 2 2200 36 Gillman ST Irvine $584,999 5 3 2294 2120 Vista Laredo Newport Beach $929,000 4 3 2100 14112 Carfax AV Tustin $449,900 4 3 2138 10535 South Cedarhil Villa Park $675,000 4 3 2387 1911 West SECREST Santa Ana $350,000 4 2 2112 3343 East Ruth Place Orange $419,000 4 2 2200 19 Sunny Slope R. S. M. $524,900 4 3 2300 13453 Barker LN Corona $239,900 4 3 2100
Here is my promo video from Zip Realty. Zip is in the process of refining the process so there may be some updates...but check out my video and let me know what you think.
* Gasol and the Lakers played tough this week knocking off Boston and Cleveland on the road.
* A-Fraud shows that baseball is in horrible shape...was anyone NOT doping? Here is Jeff Passan's take, "...he (Rodriguez) still has no saintly clue who he is: family man or cheat, religious man or agnostic, Dominican or American." Here is the whole article from Passan.
* Sean Casey wondering how A-Rod's name got out is a little disingenuous. Since when did right stop being right, and wrong stop being wrong. This country is built on the following premises "if I don't get caught, I didn't do anything wrong" and "if you aren't cheating, you are trying"...A-Rod, Barry Bonds, Roger Clemens are cheaters...and apparently so are about 103 other major league players.
* Congress passes the new stimulus plan - does anyone else wonder how we are going to pay for this? If I print money at my house...they call it counterfeiting...hmmmm!
* USC's recruiting class will be great. Telfort and Jones are going to make Trojan fans forget about Te'o and Burfict...one who can't hack it academically, the other can't hack it without his friend.
* I know I ramble about it a lot...but it is worth repeating. Barack Obama wants to raise our taxes, BUT he keeps appointing guys who don't want to pay taxes!
Coming soon...
1. Kenny Chesney top 10 2. More on the bailout and congress 3. More on the landscape of REOs and Short Sales
