Downtown San Diego Condos: 9 Steps to Buying a Downtown San Diego Condo
Sunday, January 1, 2012 at 11:45AM 
There are 9 simple steps to buying a Downtown San Diego condo. Purchasing be financially and emotionally rewarding and provide a long term view to build your real estate equity. When the San Diego real estate market seems to be at its lowest, it appears also to be a great buying opportunity. Here are 9 steps in the buying process.
1. Make the decision.
This is a long term commitment so you need to think about and research the possibility of buying a Downtown San Diego condo. If your finances are in good order and you find a "good deal" in this market, this may be the best investment you will ever make in your lifetime.
2. Find your agent.
In other parts of San Diego County you can pick any agent you want, even your cousin who is an agent in San Luis Obispo. As agents and brokers we are licensed to sell anywhere in the state of California. A 3 bedroom/2 bath house is pretty much the same in a subdivision. Once you get into purchasing in a urban setting, local expertise is critical. Buildings in downtown San Diego are unique. The different neighborhoods are incomparable. Little Italy is totally separate from the Marina District. As competent as an agent in Vista or Oceanside might be, they need the education and knowledge for the Downtown San Diego districts. Does your agent know where the Gaslamp District is located and what specific characteristics make it separate and unique from East Village, or Cortez Hill. Pick an expert in the area. You have too much money at risk for both you and your agent to be on the same learning curve.
3. Get your mortgage application started.
The days of saying "I will meet with my lender after I find a property" are over. Short sales and foreclosure sellers won't waste time with your offer if you are not preapproved or can provide your source of funds with the offer. Why would a seller, any seller, in this market pick your offer over 4 or 5 other offers when they can choose from all cash offers or buyers with preapproved mortgages? It doesn't make sense. Downtown San Diego is not as bad as you might think. Line up all your ducks in a row as they say. Pick a good lender and we don't mean the mortgage broker who may be able to provide a loan if they are able to speak to the underwriter. Go direct. We have strong lenders we recommend to our buyers.
4. Find the property.
Make a list of what you would like in your Downtown San Diego condo. Do you want to walk to the Farmers Market? Then Little Italy may be for you. Want a stroll along the harbor? Try the Marina District. Interested in the heart of the action? Gaslamp may be the choice. Decide if a mid-rise or a high-rise appeals to you. How much are you willing or able to pay for HOA (homeowner dues). Dues in downtown San Diego buildings are based on amenities, services, security, parking, etc. Dues can range from approximately $250 in a mid-rise building to $1700 in a building like The Metropolitan. Create your dream list but be realistic. Prices are based on lifestyle. If you want the best, you will pay the most.
5. Write the offer.
When you find the condo that you love and can afford, it is time to write an offer. Nothing happens until you write the offer. Your agent will help you determine an asking price. What is selling in the building? What is selling in the neighborhood? What is the condition of the unit? You may be thinking you can lowball the price and the seller will counteroffer you. Don't assume that. We just had an offer come in on one of our listings that was $60,000 under the asking price. The seller did not counter the offer. They just rejected the offer because they think the buyer is a bottom feeder. If you want the property, be realistic. Give yourself some negotiating room, unless there are multiple offers, and be in the ballpark. If you are in a multiple offer situation (which your agent can ask), write your best offer. Don't dance around an offer if you don't want to lose your partner.
6. Inspect.
If your offer is accepted you have time (usually 17 days) to inspect. Pay the money to get a home inspection. Don't assume your Uncle Joe can give you an inspection in order to save you money, unless Uncle Joe is an expert on downtown urban high-rise buildings. This is one area where it is not smart to be pennywise and dollar dumb. An inspection can run between $300-$650 depending on the size of the unit. Ask your realtor for the names of several home inspectors and compare and contrast prices and services. Check the HOA (homeowner association) documents, minutes and budget. You will be provided these documents. Read them. Ask questions. Check out where your parking place is located. Parking is critical. Make sure you car fits the space. After the sale may be too late to make a change.
7. Stay financially sound.
Don't go crazy and start buying things for your new condo. Many lenders pull a credit report just before issuing loan documents. The couch you purchased for the new condo can show up on your Visa bill and sink your loan. Sit on your hands so as not to spend money. Stifle yourself until the escrow is closed.
8. Final walk thru.
Be prepared to walk thru the unit again prior to the closing. You will be signing documents stating all your purchase contingencies are being released. Check the property out again. If the unit was tenant occupied, make sure the tenant is gone. Ensure there is nothing new since the time you first saw the unit.
9. Sign, deposit and close.
Loan documents will be prepared and sent to escrow. Escrow (which is a topic for another day), will organize the documents and call you for an appointment. Read your documents. Escrow only provides what the lender sends. They do not vet or read the documents for you. Check docs out. Once documents arrive at escrow, you will be told how much money you need to deposit into the escrow for closing. You can either have your bank wire the money, which is the most common way, or hand carry a cashier's check to the escrow. Escrow do not accept personal checks for the closing due to the time they have to wait for the check to clear. Read over your estimated HUD (estimate of closing costs). Ask questions if something is confusing. Be careful, clear and concise in your review.
