Mortgage Equation: Buy High, Feel Low

I don’t mind telling you I’ve got the blues.

More specifically, the early-in-the-mornin’, middle-of-the-evenin’, gurglin’-in-the-stomach, twitchin’-of-the-eyelids, poundin’-of-the-brain-cells, got-to-start-house-huntin’ blues.

Perhaps you know the feeling.

By next spring, I have to move. Contrary to the wishes of many of you, it probably won’t be out of Orange County. But it possibly will be out of the rental market that has rendered me comfortably numb for the last 15 years and into the home-buying market. My L.A. landlord is moving back and reclaiming her townhouse.

Everyone is telling me, “You have to buy!” in the way that people in another era told their friends, “You have to get a color TV!”

Fine. So I’m sitting at my desk now looking at a brochure someone gave me for SeaCove at the Waterfront, a “rare enclave of stylish condominiums” just a few blocks from where I live. The cheapest is a two-story, two-bedroom unit of approximately 1,600 square feet. My place is also a two-story, two-bedroom unit, but not as roomy.

The brochure says the low-end SeaCove condo is “priced from $836,990.” The high-end places start at $1 million.

OK, scratch SeaCove. By comparison, I’m living in “Shantytown at the Waterfront.”

This is how the next several months will go -- one jolt after another -- as I enter a housing market that has left me far behind.

The Times reported last week that the median home and condo price in Southern California increased more than 20% from a year earlier. We got that information from DataQuick Information Systems, my personal bad news bearers who also reported that last month was the busiest April for sales since it began keeping records in 1988. Orange County was the six-county region’s most expensive market.

“You watch all this with growing astonishment,” a DataQuick analyst told a Times reporter last week.

That’s one way to describe it.

So, why buy? Why not just find a new rental? Because, friends and real-estate people say, rents are also high. If you’re going to spend a fortune for housing, why not invest?

Grasping that logic, I met with a Realtor and a mortgage lender about six weeks ago. I remember it being a sunny afternoon that began clouding up as soon as they began providing me with raw numbers.

I expressed my home-buying paranoia; they seemed amused. And why not? They both own homes. The home-buying market, while pricey, was the only place to be, they said. I told them my income, and they told me what I could afford. I gulped and felt pangs of liberal guilt. I asked what the mortgage payment would be for a gilded palace of that price.

Palace? They laughed and exchanged knowing glances. The figure came up on the lender’s computer. “Would you like a drum roll?” he said.

He recited it. The figure was roughly three times what I’ve been paying for rent for the last decade.

Somewhere in the distance, a coyote wailed from a lonely hilltop and a swarm of locusts flapped their wings and flew away. I heard the cracking of thunder.

“I can’t afford that,” I said. “Yes, you can,” the lender said.

I asked if he would print out the information, so I could study it later -- much later.

Within days, his letter arrived. That was several weeks ago. When the lender phoned a week or so afterward to ask if I’d decided anything, I sheepishly told him I hadn’t opened his letter yet. He chuckled again and told me things would work out.

I like his bedside manner. He sounds like a good guy to borrow tons of money from.

Someday, I probably will.

Dana Parsons’ column appears Wednesdays, Fridays and Sundays. He can be reached at (714) 966-7821 or at [email protected]. An archive of his recent columns is at www.latimes.com/parsons.