Good afternoon.

Thank you for takeing my question. I live in So. Cal., have 30,000 in an IRA and after looseing, moved it to safer funds. I am considering buying a condo/TH or house. I estimate I can pay 1500/1600 a month TOTAL for monthly payment on a 150,000 to 250,000 property. 1. Should I use more than the 5% nessary for down or use all of the IRA. 2. What is the better investment a condo/TH in a nicer part of town (Santa Ana) or a house in a not so nice an part?, or should I go inland a little (GG,Buena Park) and go for a property their? I would like to keep some of the money their and try to build it back up for later. I plan to stay in the place for at least 5+ years.

You never really own your house if you buy it. Prpoerty tax never goes away and is a reagular crap shoot. You don't know how your assessment changes year to year so can't plan long term. If you rent you are more mobile. you might have to pay a lease penalty but compare that to selling a home and giving a realitor 5 to 7% of the sales price.

IT REALLY MUST BE NICE TO BE ABLE TO JUDGE OTHERS, I AM IN PROCESS OF TURNING IN MY HOUSE... NOT BECAUSE MY HUSBAND AND I WERE TAKING ON MORE THAN WE COULD AFFORD, BUT, RATHER DUE TO BANKRUPTCY OF MY HUSBANDS BUSINESS OF 32 YEARS WITH NET SALES OVER 30 MILLION ANNUALLY. WE ARE OUT OF WORK AS WELL AS OVER 150 OF OUR EMPLOYEES ...

WHAT DO YOU SUPPOSE IS HAPPENING TO THEIR HOMES?  IS THEIR LAY OFF THEIR FAULT?  MY ADVISE: DO NOT BUY A GLASS HOUSE!!

I think there is a big difference between "people that can afford to buy a house" and "people that can afford to buy a house right now".  The lenders don't look at someones earning history or employment history enough to determine whether they are truly suited to take on 30 year commitment.  And likewise, to many people assume that the will be earning as much or more in the future as they are today....without figuring for fluctuation in earnings or employment status.  Try figuring your mortgage at 70% of one weeks salary....this is morbidly conservative for some, but it would allow for some fairly drastic changes in earnings and still be able to maintain a mortgage.  If after 5-7 years of consistent growth or stability you feel the need to upgrade, redo the 70% formula at your new earnings, and upgrade...but have a formula that makes sense and leaves room for life's backhands.

I belive prices may have hit the bottom and are bouncing along, by May or June I belive buyers will stake a second look, low interest,low prices,removing rhe jumbo loan restrictions

1) How does an inflation protected security work?

2) I read Mr. Jubak's articles whenever I can and his suggestions are great.  But what if you are stuck with Mutual Funds as your sole investment vehicle with your 401k and your company only offers broad ranging funds (large cap, mid cap, international, bond funds), not industry specific funds or company stocks.  Any suggestions?

People are so naive, the fact is that real estate is limited by land which in turn is not a renewable source and therefore a limited asset. Is just a question of time but there is no doub whatsoever that the only way the real estate market will move is upward. If I had the money I will be buying cheap properties now to be rich in the not so far near future.

What does one do when it comes to this current situation?  My husband and I want to buy our first home. We have two children and its getting a little cramped. We are saving every penny we can for this. What do we do move to a bigger apartment or keep saving until the "experts" say it is time to buy?

I'm mad as heck about how out of control housing prices had gotten...I'm so glad prices are coming down, and I hope they plummet another 50%. Serves people right who overpaid for a home. There's no way people making $30-$70k per year should be "squeezed" out of the housing market. I think I'll go play with my balls now.

It's been quite some time since this country has experienced a significant economic downturn.  You can only postpone the inevitable for so long.  The 2001 recession should have been much worse but the Fed lowered interest rates to a very low level.  That didn't fix the financial issues that came from the Tech bubble.  It merely transfered them into a housing bubble and by doing so has set the stage for a much harder fall in 2008.  Now the Fed is powerless to fight the problem.  You can't fix a problem caused by cheap money by throwing more cheap money at it.