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JH says

SFace says

expensive does not make it overpriced. I can make a case it is underpriced.

hahah, SF is cheap, BUY BUY BUY!!!!

SF housing should start at $10 million for a studio with no modern amenities. That would only be for 1/2 share. If you don't have that cash then you shouldn't have protection from the elements. You don't deserve it.

JH says

SFace says

expensive does not make it overpriced. I can make a case it is underpriced.

hahah, SF is cheap, BUY BUY BUY!!!!

cheap/expensive, overprice/underpriced are completely different things. Don't commingle the two.

Based on those logic, everything good in nature are expensive/overpriced which are faulty logic.

notice Jdubb only wants the Marina district in San Francisco, which also means they would not live in Vallejo even if you pay him $500.

RE only goes up. There has never been a better time to buy!

I know this sounds obvious and I assume this is totally out of the question as I imagine its SF or nothing for you all.... but have you thought about the East Bay? You get WAYYYY more bang for your buck, better weather, and only about a 15-20 minute hop skip and a jump over to the city.

edvard2 says

I know this sounds obvious and I assume this is totally out of the question as I imagine its SF or nothing for you all.... but have you thought about the East Bay? You get WAYYYY more bang for your buck, better weather, and only about a 15-20 minute hop skip and a jump over to the city.

Especially if you have HOV access.

SFace says

cheap/expensive, overprice/underpriced are completely different things. Don't commingle the two.

cheap [cheep]
adjective, cheap·er, cheap·est.
1. costing very little; relatively low in price; inexpensive: a cheap dress.

JH says

SFace says

cheap/expensive, overprice/underpriced are completely different things. Don't commingle the two.

cheap [cheep]

adjective, cheap·er, cheap·est.

1. costing very little; relatively low in price; inexpensive: a cheap dress.

There are many people in San Francisco that overpay for housing in cheap areas because they trust the expensive advice of Realtors.

If you acknowledge you messed up by NOT buying three years ago.

YET, you are still willing to buy.

If you're giving away money, I got a few ideas. Let me know.

APOCALYPSEFUCKisShostikovitch says

You forgot to buy before 1974?

I guess you're fucked.

But but but interest rates are so low now...loans were so hard to get in the 70s.

Even at 1.2 mil, you are looking at over 22 annual rents. Don't ever buy primary residence if it's over 20 annual rents. Personally, I would get the hell out of there because paying 54Gs a year in rent is colossal expenditure, but if you insist on staying in marina, I would continue to rent.

dublin hillz says

Even at 1.2 mil, you are looking at over 22 annual rents. Don't ever buy primary residence if it's over 20 annual rents. Personally, I would get the hell out of there because paying 54Gs a year in rent is colossal expenditure, but if you insist on staying in marina, I would continue to rent.

Don't do the math. Just pay the genius who bought the home all your current and future savings and watch your testicles get pulled back into your body. You deserve nothing in this life unless you were part of the baby boomer generation and went up to your eyeballs in debt.

Well, the way I see it, rent is about a little less than 1/3 of my take home. It's too much, but it is what it is. I hope to make some more money from my job over the next 5 years. I'm not big on lots of debt, I can sleep pretty easy knowing I can pay all my bills with no problem, go travel the world if we want to. Freedom. If I could buy a place for a payment equal to or a little less than my rent with say, $100K down, it would be a no brainer to buy.
But this market makes it tough.

jdubbs29 says

If I could buy a place for a payment equal to or a little less than my rent with say, $100K down, it would be a no brainer to buy.

That'll work in Idaho or Illinois. In California even the homeless have a few hundred thousand in the bank. They made that from just washing windshields at stop lights. Your preaching to the choir. If you want to buy around here, be prepared to get stripped naked and taken in all directions while you cry out in agony. Not for the weak at heart.

RentingForHalfTheCost says

In California even the homeless have a few hundred thousand in the bank. They made that from just washing windshields at stop lights.

What street corner? I want a piece of that! All the bums on street corners where I lived aren't getting shit. Everyone is broke. Except for the few that aren't...the few who bought in 80s or 90s.

RentingForHalfTheCost says

In California even the homeless have a few hundred thousand in the bank. They made that from just washing windshields at stop lights.

hmmmmmm, I need that job. Where do I apply.
Get some sun, work at your own pace, no tax, flirt with pretty women. A few hundred thousand in the bank.

Don't laugh. A couple of years ago, they had a news show and one of the features was a street guy who would forcibly and unsolicited start cleaning windows of cars stopped at intersections in New York City until people gave him money.

He estimated he cleared tax free 80k to 100k a year. He would make money up to a point, then go to a pay phone, call a limousine to pick him up to take him to Atlantic City, where he would gamble until he lost the amount.

Then being a good loser, the casino would comp him a limousine to take him back to his street corner to make more money.

Ceffer says

Don't laugh. A couple of years ago, they had a news show and one of the features was a street guy who would forcibly and unsolicited start cleaning windows of cars stopped at intersections in New York City until people gave him money.

He estimated he cleared tax free 80k to 100k a year. He would make money up to a point, then go to a pay phone, call a limousine to pick him up to take him to Atlantic City, where he would gamble until he lost the amount.

Then being a good loser, the casino would comp him a limousine to take him back to his street corner to make more money.

To make $100K tax free, you would have to clear about $273 a day. At a generous $3 a car, you would have to clean 91 cars every day (or about 8 cars an hour for 12 hours) for 365 days a year.

Unlikely.

jdubbs29 says

To make $100K tax free, you would have to clear about $273 a day. At a
generous $3 a car, you would have to clean 91 cars every day (or about 8 cars an
hour for 12 hours) for 365 days a year.

Unlikely.

Plus they better have good insurance cause it's only a matter of time until a type A personality driver who's in a hurry runs them over like a stray dog.

JH says

RentingForHalfTheCost says

In California even the homeless have a few hundred thousand in the bank. They made that from just washing windshields at stop lights.

What street corner? I want a piece of that! All the bums on street corners where I lived aren't getting shit. Everyone is broke. Except for the few that aren't...the few who bought in 80s or 90s.

http://www.outhousedaily.com/2013/05/worlds-richest-bum-offering-panhandling.html

http://www.sfgate.com/bayarea/article/S-F-man-is-homeless-by-choice-He-has-a-2833486.php

http://www.huffingtonpost.com/2012/07/23/shane-warren-speegle-says_n_1694577.html

We are the stupid ones. Actually working trying to get ahead.

jdubbs29 says

8 cars an hour for 12 hours

They showed him in action. He plucked money from the cars pretty fast, basically to make him go away. They also showed him on the phone calling the Atlantic City express.

It is a high risk endeavor. I would imagine just one angry person getting out of a car and kicking the crap out of him and putting him into the emergency room.

jdubbs29 says

Ceffer says

Don't laugh. A couple of years ago, they had a news show and one of the features was a street guy who would forcibly and unsolicited start cleaning windows of cars stopped at intersections in New York City until people gave him money.

He estimated he cleared tax free 80k to 100k a year. He would make money up to a point, then go to a pay phone, call a limousine to pick him up to take him to Atlantic City, where he would gamble until he lost the amount.

Then being a good loser, the casino would comp him a limousine to take him back to his street corner to make more money.

To make $100K tax free, you would have to clear about $273 a day. At a generous $3 a car, you would have to clean 91 cars every day (or about 8 cars an hour for 12 hours) for 365 days a year.

Unlikely.

Sit on a corner in SF and watch the amount of money getting exchanged. I have, and it would surprise you. Your vision as a car driver is just a 3 minute stop at the light. If you see one exchange each light then that is 20/hr.

Hey I've considered East Bay, but every time I go over there, I just...don't like it. I like living in the city.

I'm willing to live in other parts of the city (close to where I am now), and well aware of the earthquake situation. Just making it simple to say Marina, could be Russian Hill or Pac Heights.

Would like to stay at 1,200+ sq feet and 2BR/2BA. Would love to pay around $900K-$1M but unfortunately nothing in that price range.

I'm not unhappy renting by any means, and I've managed to save a decent amount. But buying is always in the back of my mind.

I am pretty close your your situation. Always made sense to rent.

One option would be to buy a cheap 2nd home somewhere that you guys might be able to escape to on the weekends- if you guys like the mountains or something like that. Wine country? You can improve it over the years etc. Anyway, I rent my primary and bought a 2nd home that I do all my fun stuff at.

Best choice I made.

jdubbs29 says

Hey I've considered East Bay, but every time I go over there, I just...don't like it. I like living in the city.

I'm willing to live in other parts of the city (close to where I am now), and well aware of the earthquake situation. Just making it simple to say Marina, could be Russian Hill or Pac Heights.

How much time have you actually spent in the east bay? As in did you go for dinner or something? The thing about the east bay is that its HUGE. Its actually more diverse in terms of geography, type of neighborhood, age, demographics, and weather than SF. IMHO, you are at this point over-paying for your rent now. Perhaps it wouldn't hurt to consider renting somewhere in the east bay, and spend a good 6 months to a year feeling it out. To be honest, when I first moved to the east bay i didn't like it either. Then I discovered another area I liked a lot and that's where I bought my house 2 years ago.

Should you buy in SF?

I approach this in the exact same way that I approach in buying anywhere else.

If your annual rent exceeds 6-7% of the price of the house, it's OK to buy. 9+ percent means great buy. And less than 6% is an absolute no go.

Keep in mind that reaching 6% in SF isn't common...

Best of luck.

You mean the ghetto calculator. The higher the %, the more ghetto and more ok?

SFace says

You mean the ghetto calculator. The higher the %, the more ghetto and more ok?

While it's true that there is a correlation between rent:buy ratios and how ghetto a city/zip code/neighborhood is, it still has to make sense on some level to buy vs rent.

The original question is should the thread starter buy in SF. I'm not saying he should look for rent:buy ratios that match East Oakland or Vallejo (>10%), but you never know what the future holds in terms of job loss or financial distress. If I can't at least break even on my mortgage with rent on any given property, I really have to think twice if it is a move I want to make.

If you can't make money renting, then you are banking on the value of the house rising. With this latest bubble, I'm not sure that's a bet I'd want to make, at least for the not too distant future.

Of course there is the counter argument that if you are ready to buy, and you can afford it, and you have/want to start a family, and there's value for you in being in SF, then by all means...