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Buy now or be priced out forever 2.0

By PockyClipsNow   May 9, 1:35pm   11 links   9,363 views   90 comments   watch (2)   quote      

Real estate is a' boomin in Los Angeles. Apparently the anti-trump rhetoric doesnt apply to real estate OR stock market - in fact it appears to be inversely proportional. The more they bash Trump the higher the markets go. (finally a reason to like liberals!)

So it turns out the permabears who said I would be bankrupt after buying a house in 2012 were wrong.

I sold that house(250k net profit) 2 years ago and bought a small condo which is now up 200k.

So I'm up 450k in 7 years(tax free too). I'm going to sell this condo now to take advantage of the 2 year tax free cap gains rules to cash this shit in before the next 'happening'.

I believe California coastal prices have a solid floor under them ESPECIALLY in the 'good school' district areas (this is racist code word for white/asian of course).

CA will remain a sanctuary state, and the remaining 'good school districters' will pay ever increasing amounts of money to flee the brown horde. Anti-white rhetoric is crazy high, and did not go down after the eletion. School kids take that shit seriously and god help the poor white kids in a 'low test score' school.

I'm probably going to move to Tahoe, NV or Reno so I can bash California online and bitch about how awful it was and I had to leave.

People seem to enjoy doing that. I remember all the people who sold and moved out of state in 05/06 and they made a pretty good choice.

I didn't do as well as Iwog or that mexican economics professor who got doxxed(roberto?) here bragging about his properties.... BUT i will have a paid off house of around 400k and 1m net worth outside of that when I retire (probably by year end). I turn 50 soon, and getting too old to code.

Anyone else here going to white flight from CA soon? What is your prediction about CA residential RE prices?

#housing

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51   Strategist   May 9, 7:09pm     ↑ like   ↓ dislike   quote    

iwog says

Strategist says

May i remind you we live in the 21st century where the free market determines the rent?

Feudalism is the state whereby all or most properties are owned by the aristocracy, they are literally in bed together, and the only thing that determines rent is how much money can be collected without putting a family into the street.

We don't have feudalism anymore. You have rental properties, so are you telling me you are one of those evil aristocrats?
I have rental properties, and I don't price any of my rentals based on how much the serfs have, I base it on who the most qualified serf is, and what the market is. By the way the Serfs in my properties are literally lawyers, executive chefs, and professionals make upwards of $150,000. My rents are still below market, and I think I am the one who is being exploited.

52   Strategist   May 9, 7:15pm     ↑ like   ↓ dislike   quote    

iwog says

Strategist says

The serfs have all the opportunities that everyone else has. If they don't take it, that's their problem.

This is so cute and naive and dead wrong. The serfs in the Philippines can't even buy a car. Most can't even buy a motor scooter. They live at the mercy of the aristocracy which will pay a typical pinoy worker about $200 per month to do whatever is required of him. All the condos in Manila have a servants quarters. ALL OF THEM. I toured many. When is a worker making $200 a month going to be buying a car or even renting a house?

That I agree. The serfs in Somalia, Ethiopia, Cambodia, India and many other countries can't even buy food, least of all a car. They need to have a system that we have. Hello?

53   iwog   May 9, 7:19pm     ↑ like   ↓ dislike   quote    

Strategist says

We don't have feudalism anymore.

It's coming back.

Strategist says

You have rental properties, so are you telling me you are one of those evil aristocrats?

Yup, but I'm a small fry. I'm going to get gobbled up.

Strategist says

Serfs in my properties are literally lawyers, executive chefs, and professionals make upwards of $150,000. My rents are still below market, and I think I am the one who is being exploited.

Do a genuine analysis on what $150k will get you these days. At 5% (good luck with that) it's enough capital to generate $7,500 per year. Meanwhile rents in areas where the average wage is about $150k are approximately all of it after the car and insurance and cell phone payments. Maybe a few shopping trips for clothing and shoes. Even the top 5% of wage earners are still living on the edge.

This system is unsustainable and the reason is because there's STILL a river of capital flowing to the top. Everyone knows how a Monopoly game ends. It's incredible that no one seems capable of applying that lesson to real life.

54   PockyClipsNow   May 9, 7:30pm     ↑ like (1)   ↓ dislike   quote    

iwog says

Everyone knows how a Monopoly game ends. It's incredible that no one seems capable of applying that lesson to real life.

Yes in monopoly my brother always cheated, my sister always loses first then she threw a tantrum and tossed the board. We NEVER finished ONE damn game.

Its just like the housing bubble, the people playing the game doesnt follow the fucking rules printed on the damn box.

55   Strategist   May 9, 7:45pm     ↑ like   ↓ dislike   quote    

iwog says

Strategist says

Serfs in my properties are literally lawyers, executive chefs, and professionals make upwards of $150,000. My rents are still below market, and I think I am the one who is being exploited.

Do a genuine analysis on what $150k will get you these days. At 5% (good luck with that) it's enough capital to generate $7,500 per year. Meanwhile rents in areas where the average wage is about $150k are approximately all of it after the car and insurance and cell phone payments. Maybe a few shopping trips for clothing and shoes. Even the top 5% of wage earners are still living on the edge.

This system is unsustainable and the reason is because there's STILL a river of capital flowing to the top. Everyone knows how a Monopoly game ends. It's incredible that no one seems capable of applying that lesson to real life.

Ha ha ha. Those poor serfs making $150K. What a miserable life they lead. They have to pay to live in a good area, they have to pay for the Mercedes and BMW's, they are even forced to pay for their well deserved Hawaiian cruises.
One of my tenants, a hot beautiful Swedish blond, makes a ton of money, only eats at high end Newport Beach restaurants, and wants the best of everything. I wish I could live like that, and I'm the fucking landlord. I wish I was a serf.

56   BayArea   May 9, 7:48pm     ↑ like   ↓ dislike   quote    

There sure seem to be a lot of landlords on this site...

57   iwog   May 9, 7:51pm     ↑ like   ↓ dislike   quote    

Strategist says

Ha ha ha. Those poor serfs making $150K. What a miserable life they lead. They have to pay to live in a good area, they have to pay for the Mercedes and BMW's, they are even forced to pay for their well deserved Hawaiian cruises.

They end up destitute and in my bankruptcy office if anything goes wrong. We get Lafayette and Orinda clients all the time. All it takes is one good divorce or a medical problem and the whole house of cards comes tumbling down.

58   BayArea   May 9, 7:55pm     ↑ like   ↓ dislike   quote    

iwog says

Strategist says

Ha ha ha. Those poor serfs making $150K. What a miserable life they lead. They have to pay to live in a good area, they have to pay for the Mercedes and BMW's, they are even forced to pay for their well deserved Hawaiian cruises.

They end up destitute and in my bankruptcy office if anything goes wrong. We get Lafayette and Orinda clients all the time. All it takes is one good divorce or a medical problem and the whole house of cards comes tumbling down.

That's so grim, but I don't doubt it for a second. Most people can't keep their head above water for more than a few months once the income supply is cut off.

Iwog, what do you do for a living beyond the rentals?

59   iwog   May 9, 7:59pm     ↑ like (2)   ↓ dislike   quote    

BayArea says

Iwog, what do you do for a living beyond the rentals?

I manage a bankruptcy law office and sell shit on ebay.

60   Strategist   May 9, 8:04pm     ↑ like (1)   ↓ dislike   quote    

iwog says

Strategist says

Ha ha ha. Those poor serfs making $150K. What a miserable life they lead. They have to pay to live in a good area, they have to pay for the Mercedes and BMW's, they are even forced to pay for their well deserved Hawaiian cruises.

They end up destitute and in my bankruptcy office if anything goes wrong. We get Lafayette and Orinda clients all the time. All it takes is one good divorce or a medical problem and the whole house of cards comes tumbling down.

You know, you are probably right. They are living on the edge, and one step away from BK. The lawyer tenant is just saving up to buy a house. The executive chef I'm not too sure. The others are like Indian medical students whose doctor parents have co signed for the lease.
Trust me on this....I am very good at picking tenants. Most of my tenants are just moving up to buy their own home. They are well educated, have a head on their shoulders, and just want a decent place to live in until they move on. These are the tenants who will never give you problems.

61   just_passing_through   May 9, 8:09pm     ↑ like   ↓ dislike   quote    

iwog says

All it takes is one good divorce or a medical problem and the whole house of cards comes tumbling down.

Which is why belonging to a good family is important. Something that isn't prioritized in the CA culture we have here.

Two of my houses are in one of the top-2 fastest growing zip codes in the nation. There's plenty of jobs a diverse job market and easy opportunity for anyone who applies themselves there.

Problem with CA is the govt and older greenie generation have decided: Fuck You! We've got ours and we won't let you have yours because BUILDING! is baaad... If you don't like it GTFO!

Seriously I listened to a radio broadcast of the mayor of El Cajon just yesterday who said how only 15 years ago mail carriers and jobs like that could buy a house here but not any more for just those reasons.

In CA you can't build up and you can't build out. CA does not represent the entirety of the USA. If you play it right you can make a lot of money though. Some of those young software developers living in rider vans on the SF peninsula are stashing some serious bank for their future.

62   Strategist   May 9, 8:24pm     ↑ like   ↓ dislike   quote    

BayArea says

There sure seem to be a lot of landlords on this site...

Fucking capitalists, exploiting the poor who make more than me.

63   FortWayne   May 9, 8:43pm     ↑ like   ↓ dislike   quote    

E-man says

FortWayne says

iwog says

The building is not going up.

The elevator is going down.

I keep telling you people.

Prices can't go to infinity.


At some point income is below mortgage

Look at Vancouver, Canada, Sydney, Australia, Shanghai, China as an example. Don't argue against the market.

Do you boys think it'll keep going up for a while still? Personally I don't see anything that will cause a major shift in any direction, demand is pretty high though, supply isn't going up, we all know what that means in theory.

64   FP   May 9, 10:03pm     ↑ like   ↓ dislike   quote    

E-man says

Look at Vancouver, Canada, Sydney, Australia, Shanghai, China as an example. Don't argue against the market.

Canadian bubble is imploding, or about to start. It will be fun watching.

65   Quigley   May 10, 3:41am     ↑ like (3)   ↓ dislike   quote    

The problem with capitalist policies when it comes to land and residences is that as iwog has said, it's a zero sum game. Sure, it might look free market for a while, but only until the properties are all gone within reasonable distances of commercial centers. Given enough capital, the wealthy will buy up all available land and rent it back to the peasants for whatever they got. This trend will only exacerbate as population expands, and monetary and tax policy continues to grossly favor the rich. At some point the entire country is owned and you have little choice but to pay asking rent on whatever hovel your wages will afford wherever it's located.
We are getting there real fast in much of California.
The only way to stop or reverse the trend is progressive taxation on property owned beyond the first. Say double tax on the third non commercial property and triple on the fourth, and so on.
The problem with land is that they aren't making more of it while they are making more people to fill it up.

66   BayArea   May 10, 8:03am     ↑ like (2)   ↓ dislike   quote    

Quigley says

The problem with land is that they aren't making more of it while they are making more people to fill it up.

I agree with most of your post above.

But the problem is not land, the problem is lack of building.

Take a plane flight across the country and look out the window to see how much of this country is uninhabited.

67   Dan8267   May 10, 8:13am     ↑ like (1)   ↓ dislike (1)   quote    

BayArea says

Take a plane flight across the country and look out the window to see how much of this country is uninhabited.

Those places don't have jobs. The problem with land is that it's usefulness is proportional to its population density, and thus also to its scarcity. This is why Georgism is the best economic philosophy.

68   just_passing_through   May 10, 8:17am     ↑ like   ↓ dislike   quote    

Dan8267 says

Those places don't have jobs.

Not true and although wages are lower in those places the standard of living is higher than it is in the bay area.

69   goat   May 11, 7:47pm     ↑ like   ↓ dislike   quote    

iwog says

although I'm still going to take some money off the table and perhaps buy abroad.

How come? Is it just that you've reached an amount of wealth that your content with and would rather secure it than risk losing it by trying to get more playing future usa turbulence?

70   Strategist   May 11, 7:54pm     ↑ like (1)   ↓ dislike   quote    

Dan8267 says

BayArea says

Take a plane flight across the country and look out the window to see how much of this country is uninhabited.

Those places don't have jobs. The problem with land is that it's usefulness is proportional to its population density, and thus also to its scarcity.

I can't believe you said that. I'm glad you started reading Econ 101.

71   Strategist   May 11, 8:03pm     ↑ like   ↓ dislike   quote    

goat says

iwog says

although I'm still going to take some money off the table and perhaps buy abroad.

How come? Is it just that you've reached an amount of wealth that your content with and would rather secure it than risk losing it by trying to get more playing future usa turbulence?

Reinvesting abroad is probably OK. I do know prices in California can only go up because in the last 10 years Ca has averaged building 80,000 residential units when we needed 180,000 units. It will take a long time to make up for this building deficit.

72   just_passing_through   May 11, 8:12pm     ↑ like   ↓ dislike (1)   quote    

Strategist says

I do know prices in California can only go up

The last chick I dated in the bay area before leaving belonged to an organization I'd rather not name. Through here though I was invited to some interesting parties. Literally one of the Rothschild's mansion in the East bay where I hung out next to that guy and the then San Jose mayor. (5 years ago)

Just eaves dropping this is a summary: By the end of the century the state expects the west coast and CA in particular to be more populated than the East coast. The SF bay area will make the NY area look small by comparison. I don't want to get all Agenda-21 whack job but they discussed the need to get people out of the suburbs and into planned corridors. Removing services from the suburban areas (fire, police etc) to prep for this. Their corridor would extend from the bay area, along the 5 and blend into Sacramento. One big super region.

Primarily they expect the population to come from Asian countries. China in particular.

If you can't beat em join em! I do believe over the long run in CA prices will go much higher than they are right now.

73   RealEstateIsBetterThanStocks   May 11, 8:38pm     ↑ like   ↓ dislike   quote    

at the same time i also hear we are long overdue for a Huge earthquake in CA.

74   Strategist   May 11, 8:49pm     ↑ like   ↓ dislike   quote    

just_passing_through says

Strategist says

I do know prices in California can only go up

The last chick I dated in the bay area before leaving belonged to an organization I'd rather not name. Through here though I was invited to some interesting parties. Literally one of the Rothschild's mansion in the East bay where I hung out next to that guy and the then San Jose mayor. (5 years ago)

Just eaves dropping this is a summary: By the end of the century the state expects the west coast and CA in particular to be more populated than the East coast. The SF bay area will make the NY area look small by comparison.

There is no reason why it could not happen well before that. People like to live where they love to vacation, and there is no reason why Hawaii, California, Florida and the Caribbean won't see spectacular increases in population and real estate prices.

75   EBGuy2   May 11, 11:04pm     ↑ like   ↓ dislike   quote    

Just saw today that Yik Yak pissed away $47 Million. Free apps. Who could have known. This will not end well...

76   YesYNot   May 12, 4:10am     ↑ like   ↓ dislike   quote    

just_passing_through says

Not true and although wages are lower in those places the standard of living is higher than it is in the bay area.

I interviewed in Santa Clara in the late 90s. A manager warned me that I'd have to pay 400 k to buy a house, and that would be for a small house with a commute. It seemed high for a 100k or so salary they are offering. Otoh, I wonder what that house would go for now. The point being that a high price with inflation is fine. It's only deflation that would make it a bad really shitty deal.

77   JZ   May 12, 7:39am     ↑ like   ↓ dislike   quote    

I read through the discussions and i think it is all speculations from different angle.

My thinking is that the price/rent is now 30.
In 2009, it was 15.

Above are valuation numbers without any sleculatikn on future state/feseral policies/plannings or money flow on international or rich/poor/serf/elite.

I will be a buyer when that number gets to 20 or so. I will sell when that number hits 40 in CA.

78   just_passing_through   May 12, 9:14am     ↑ like (1)   ↓ dislike   quote    

Strategist says

there is no reason why Hawaii, California, Florida and the Caribbean

I've been looking at Hawaiian condos as well. I've got a pal who makes a killing on vacation rentals which are pretty easy to manage remotely via VBRO.

79   goat   May 12, 9:54am     ↑ like   ↓ dislike   quote    

For those interested, here's some govt CA population projections http://www.dof.ca.gov/Forecasting/Demographics/projections/
This http://www.dof.ca.gov/Forecasting/Demographics/projections/documents/P1_County.xlsx shows they expect about 25% overall state pop increase 2020 through 2060.

but...
About 32% in Alameda, Contra Costa, & San Francisco counties
18% San Mateo & Santa Cruz county
39% Santa Clara & Solano counties
46% San Joaquin county
43% Sacramento county
58% Merced & Yolo counties
37% Stanislaus county

wow@santa clara. where will they build....gilroy? lots of multi unit housing in the urban areas?

looks like the eavesdropper's info matches this. there's a lot of expected growth in the area between the bay and sacramento.

80   goat   May 12, 10:23am     ↑ like (1)   ↓ dislike   quote    

just_passing_through says

I've got a pal who makes a killing on vacation rentals which are pretty easy to manage remotely via VBRO.

please elaborate on how much a killing is :p

81   iwog   May 12, 12:27pm     ↑ like   ↓ dislike   quote    

goat says

How come? Is it just that you've reached an amount of wealth that your content with and would rather secure it than risk losing it by trying to get more playing future usa turbulence?

Simple diversification combined with my exit strategy if this place gets too hostile to intellectuals.

Chile is so safe and prosperous right now, and the climate is so similar to California that it's a natural for me.

82   iwog   May 12, 12:30pm     ↑ like (1)   ↓ dislike   quote    

just_passing_through says

I've been looking at Hawaiian condos as well. I've got a pal who makes a killing on vacation rentals which are pretty easy to manage remotely via VBRO.

I'm doing that also and the returns are fantastic.

83   just_passing_through   May 12, 1:18pm     ↑ like   ↓ dislike   quote    

goat says

please elaborate on how much a killing is :p

Okay, well, 'killing' may be a bit of an exaggeration but I'd take it and hold it for 30 years expecting it to get much better:

He bought a two bedroom condo steps away from a sea wall 2 years ago for 650K. It appreciated 80K - just sold it for that much more this week. On leases he grossed ~100K and netted ~40K yearly.

He bought it 2 years after the 40 year sea wall was rebuilt so didn't expect any large assessments in the near term.

He's a real estate broker and lawyer here in SD. He wanted to get the cash back out of it because he thinks the stock market is about to crash and wants to take advantage of that. Then buy back into the Hawaii market. If I were him I would have kept that place.

84   goat   May 12, 1:51pm     ↑ like   ↓ dislike   quote    

just_passing_through says

He bought a two bedroom condo steps away from a sea wall 2 years ago for 650K. It appreciated 80K - just sold it for that much more this week. On leases he grossed ~100K and netted ~40K yearly.

If by net you mean after mortgage, taxes, property management, house cleaning, and whatever else....damn that really is great.

I took a quick peek at vrbo and judging by the availability calendar of a few units I looked at, it looks like most rentals in HI are booking 80-90% of the days per month. Looks like a very effective marketing platform....it's cheap too.

85   just_passing_through   May 12, 2:00pm     ↑ like   ↓ dislike   quote    

goat says

If by net you mean after mortgage, taxes, property management, house cleaning, and whatever else

Yup, that's what I mean. The cool factor is you have a frigin condo to go visit as a tax write off as well! His place was in a small building, sort of homey. Maybe 15 or 20 units? Initially he let the building management handle things but they did a crappy job getting high leases and charged 30%. He took it over with VRBO and got to know the building maintenance guy who did side work for him on the cheap.

86   just_passing_through   May 12, 2:01pm     ↑ like   ↓ dislike   quote    

His cleaning fees are part of the leasing contract: An extra $175

The VRBO app automatically notifies the cleaning service when guests check out.

87   goat   May 12, 2:19pm     ↑ like   ↓ dislike   quote    

just_passing_through says

The cool factor is you have a frigin condo to go visit as a tax write off as well!

haha ya, I was just thinking about how cool it would be to just fly out there and use it if you had a few days you couldn't book, but write it off as business expenses :p

88   just_passing_through   May 12, 5:00pm     ↑ like   ↓ dislike   quote    

That's what my pal does - but he does do some work on the place when he visits. Generally he goes in the 'off season' which starts right around now. His rates are variable and peak around the holidays.

Perhaps somewhat counter-intuitively the airlines drop prices right before he wants to leave rather than raising them the last two weeks. Or usually apparently. He also has an Alaska airlines credit card which lets him bring a friend or family member 1x per year for only $100. I think the card has an annual fee of $50 or $80 though.

89   0d2e   May 12, 8:16pm     ↑ like   ↓ dislike   quote    

Yes the chance that all dirtskins have been waiting for is to act out violently towards whites. Been their ambition and motivation since the first one swam across the river. This antifa bullshit should be a major wakeup call for what happens when you allow this many latin american and muslim terrorist into our country. I'd love to leave ca but its the same everywhere except in inhospitable places but their showing up their also. If you never want to see another shitskin Mexican or Muslim ever again, and deal with their uncivilized approach to life, you have to move out of the country.

90   Dan8267   May 12, 8:52pm     ↑ like   ↓ dislike   quote    

Strategist says

I can't believe you said that. I'm glad you started reading Econ 101.

They don't teach that in econ 101. I know because I actually took economics in college. College 101 courses are very basic.

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