Last weekend was a big event for my family. My cousin got married, so everybody gathered together to celebrate. I had a chance to see my two uncles, one from Salt Lake City and one from Orlando, and other cousins. I have not seen them for a long time, so it was really really fun to talk to each other. We also have a new family member. My uncle from Utah adopted a little girl a few years ago but this was the first time he introduced her to the whole family. Her story was really heart-broken to me. Her mom was my aunt’s coworker. They have worked at a Chinese restaurant. That lady got pregnant with a married guy and had to raise this little girl by herself. He did not acknowledge this child as his daughter. Then the mom had cancer and died. Before she passed away, she asked my aunt to take care of this little girl. No one in China could take care of this girl (her mom was a Chinese immigrant), so my aunt and my uncle decided to let her live with their son and daughter as a family. When I met her, I thought she was my cousin’s friend. She rarely smiles, but she is very beautiful and I can’t wait to see her grow up and live happily and independently. This story reminds me that I am still happier than a lot of people and I should not take this life for granted.
Ok, so go back to my home shopping. One of my mom’s customers is a real estate agent. She also has an office in the same building with my mom’s store and she gave my mom a list of townhouses and houses for sale. So I decided to go with her on Sunday. I have seen 3 townhouses and 3 houses. The one I like most is a townhouse in Garden Grove. The listing price is 259,900 and it is an owner’s sale. Here are the actual pictures of the unit:
It has 2 stories, 3 bedrooms, 2 1/2 baths, 1500 sq ft, 2 car garage and a designated parking space outdoor. The downside of this unit is high HOA fee $255/mon. Also, we saw the townhouse on Sunday but the parking lot was kind of empty, so I wonder why not many people living here. By the way, zillow.com does show the history of sale. You can find out how much it was sold, how many times it was sold, when it was sold and how much the market prices were at various years. The owner of this townhouse bought it in 2002 with 288k. In 2008 before the housing bubble, its value went up to 311k, and now it is down to 260k.
My boyfriend told me to buy a 3 bedroom condo in Vegas which is about 54k with HOA fee $45/mon. I will be able to pay off the unit without mortgage loan or down payment and I can rent it out to students of my school. With 3 bedrooms, the rents are about 900/mon, minus HOA fee, savings for maintenance, property tax, hazard insurance, I still take home 600/mon as profit. In contrast, to the townhouse in CA, I can rent it out but the rent is just enough to cover the mortgage. I still have to do calculation on tax benefit in these 2 situations. I don’t know. It is really complicated when it comes to tax filing. I have spent 2,3 hours just to read about real estate tax deduction and still don’t get it. After couple lines, it will refer to another publication, form or instruction to read. I have a headache after reading those materials. But I know I have to read until I understand it. Challenge makes it more interesting, don’t you think?
I watched an interview of Professor Shiller yesterday and he mentioned about American dream of home ownership. He said that “many Americans were raised to believe that housing was always the best investment. But on an inflation-adjusted basis, U.S. home prices were flat from 1890 to 1990, meaning the whole concept of housing wealth was “a bill of goods”…But the idea of the “American Dream” does have merit. Home ownership pays a dividend in self-respect. Indeed, the idea of owning your own home has personal and societal benefits; the problem was the widespread misconception that housing was the path to wealth and financial freedom. 11 million homeowners under water is a proof that they weren’t protected and need a way to hedge their housing risk”. His idea is to improve the financial law to protect homeowners from foreclosure. I totally agree with him. My uncle is also a victim of foreclosure, and his family is broken into pieces after that incident. I have 7 uncles and 2 aunts, and three of my uncles have complicated lives. The bigger the family you have, the more complicated it is.
I really like Professor Shiller. My next book of reading is one of his books, Animal Spirits. In this book, he mentioned that Singapore Prime Minister Lee Kuan Yew “may be one of the most important economic thinkers of twentieth century”. I will tell you why in my next post. Have a good weekend, hasta la vista.