Yes, prices have gone back down to 2002 levels in Palo Alto, but they're still falling. Vast amounts of money remain to be lost.
Even more interesting than prices is the near-death of the jumbo market in terms of sales. There's still a stalemate between buyers and sellers at these levels. Buyers are boycotting (and can't get huge loans) and sellers don't yet realize that they must keep lowering prices to have any chance of selling. I've seen houses in PA and Menlo Park on the market for over a year.
That stalemate was broken long ago at the low end, because poor people were living much closer to the edge, and literally could not make their payments. So asking prices actually reflect reality much better in poorer neighborhoods.
Many Palo Alto properties are very old and they indeed could have foundation problems. But that's not the point. In 2007/2008 these properties were sold in $1.7M range irrespective their conditions. Is there similar property in Palo Alto that sold for $1.3M in 2007/2008, because it had foundation problem?
I beleive a mortgage should never exceed 15 years. This allows an indivual to save for retirement the last 15 years by which they can still get their tax incentive through an IRA. Then after 30 years from the purchase date of their home, they have a home that is paid for and a sizable retirement account. If people could only see this more clearly, they would be so much better off.
Palo Alto has always been a very expensive area to buy in even before the bubble. Im not sure why it is so expensive. The houses are tiny. I suppose the short commute to higher paying silicon valley jobs.
" I suppose the short commute to higher paying silicon valley jobs."
If the commutes you, I and everyone else sees every morning are any indicator, many who work in SV dont live anywhere near Palo Alto. Even if you live in PA, there is no guarantee that your next job will be anywhere near PA. So your commute may well be very far. What does it say about the IBM plant in So San Jose, Seagate in Scotts Valley, Autodesk in San Rafael or maybe someone in the East Bay.
I suppose the short commute to higher paying silicon valley jobs.
The same argument could be made for higher-paying jobs in SF's Financial District, but just compare what you get for $1.3M now in nearby Sausalito, Berkeley, Mill Valley, or even Tiburon. The commute is in fact easier than sitting on 101/280 from PA to SV, especially taking the ferry. Then compare homes in terms of scenery, views, proximity to culture (SF/Berkeley). SV might as well be Fresno in terms of things to do, although I imagine people in Fresno are nicer.
I lived in Marin for years, and there are things I dislike about the county (the snobbery and New Age crap). Even so, the price premium for PA, Los Altos, MP--even Atherton is simply mind-boggling considering what you get. Residents tacitly know this, and get more uppity simply to offset the value:price disparity. If a value could be put on community charm, many of the "prime" towns are in negative territory for their cold, aloof neighbors--and essentially nothing to do.
I think the lack of warm neighbors around Palo Alto follows directly from old Mr. Stanford's attitude. He was not a warm friendly community-oriented guy, and he deliberately isolated the university from the town. He was also supendously rich, and I think the very rich never know who their friends really are, because the money just attracts all sorts of false friends. So they get paranoid, and isolationist. And the whole area gets infected with that attitude.
Money solves some problems, but it cause other problems.
I recall back before the bubble Condos being around $300K before the bubble. They were flat for the decade.
Here is the price inflation/deflation history of one I was able to dig up on zillow. The price swings
are very telling about what prices were once and how much prices went up, and how much still
to come down... Inflation since 1997 is still around 30-35% which would put that same condo
at $400K .. certainly not $800K-1M. And as the price history indicates the same home went into
foreclosure several times over.
I think the lack of warm neighbors around Palo Alto follows directly from old Mr. Stanford’s attitude.
I can see that, people follow the lead, hoping to be just as successful. There's an analog in Marin, where some guy made a killing on RE during the depression. A lot of people want to be the second coming of that guy, and if/when Marin crashes no doubt somebody will clean up again.
The SFBA is essentially a boomtown culture; the bug has been here since the gold rush. A lot of people come here hoping to become the next "tech entrepreneur". A few do, but the rest of us are just working stiffs--who face a lot of peer pressure to "succeed"--because living costs are so high. Some people get so fixated that work never leaves their head. I've been to several dinner parties where some guest opens up their briefcase and makes an impromptu sales pitch on "the next big thing". Perhaps I've seen the more crass end of the local scene, lol.
patrick, I invite you to come vist the 1000 block of Ramona and talk to the neighbors before making such assumptions. I am a former neighbor of a surrounding block and they are the nicest group. They shut down the street once a year and have a neighborhood block party, they watch out for each others houses while they are away on vacation, and are generally a very friendly bunch.
And, if you would like to become their neighbor, you have a chance as the reincarnation of 1029 Ramona has come back on the market.
They shut down the street once a year and have a neighborhood block party, they watch out for each others houses while they are away on vacation, and are generally a very friendly bunch.
For a Million dollars I would expect a lot more than that. But really now, didnt we all that back before there was a bubble during the 4th of July anyway? Im sure the birds sing Mozart in the morning as well.