patrick.net

I have seen at least 3 loss cases in RE in CA, so people who claimed that they have never seen any losses in CA are just kids who haven’t been around the block long enough.

Very well said. One of my father's friend said that his home lost 50% of value after the tech bust. The house of my friend's friend lost millions in value just a few years ago.

Those two cases were in the Bad Area / Silly Valley.

But how many investors will call it a good investment to wait 10 years to see the price breaking even? How many 10 years do you have in your life?

Important distinction this time...RE has become "Dot-Com II". While I think most investors won't hold off until the bitter end, I'd venture to guess many haven't even caught wind of the change (such as my coworker). When investors do run for the door, I anticipate an inventory build-up that will pale past booms/busts.

I've posted examples before of people I know who also had to ride out the down market for 10 years just to see the house return to the purchase price. Also the post I put on this thread about the guy who's already dropped his asking price $100,000 should be a good indicator that right now is not the time to buy, but in 2-3 years you might look at the market again.

Important distinction this time…RE has become “Dot-Com II”. While I think most investors won’t hold off until the bitter end, I’d venture to guess many haven’t even caught wind of the change (such as my coworker). When investors do run for the door, I anticipate an inventory build-up that will pale past booms/busts.

Exactly. It seems that many people are trying to time the top of the boom. They will not hesitate to sell if they are convinced that the peak has arrived or has passed.

500 comments? OMG! We should celebrate!

Cathy, you should use your own judgement. We can only provide decision support. You need to make a decision based on many factors that are unknown to us. Moreover, most sources of information are biased one way or the other.

Cathy, the words of Peter P, just above this post, are the best advice that you could have received.

Sleepless

You sound like I feel. Even though I live in Ca, my area used to be affordable until all the bay area folks came in and bought everything for exhorbitant prices and bid everything up. You're absolutely right that nothing is being solved, only transferred to a new location. I think a lot of these people really don't have a clue. They think they're economically savvy, but they'll end up with multiple properties that will likely go down in value and probably face foreclosure or bankruptcy. I won't feel sorry for the greedy who get burned. I only feel bad for people who got pressured by their peers and their own fear into buying something they couldn't afford.

Frankly, my hope is a very sharp cutback in housing prices due to rising interest rates, but mostly due to tightening of credit, etc. I’m sick of people getting lucky in the market and then further trashing market fundamentals.

Market has its ways to punish excesses.

I realize that most of you are in CA and I apologize, I don’t mean to pick on Californians. It could be anywhere, but it happens to be that most people coming here (and AZ, NM, TX, NV) are people cashing out down there. Can’t you go to Iowa or Kansas instead? Thanks for letting me vent

Cali-phonier deserves such bashing.

Hi sleepless,

I lived in Seattle before. No worries, there will be a big crash up in the Pacific Northwest. In 1989 when many CA residents were driven north by the last bubble, Seattle properties literally tripled overnight. Then in 1991, after two years of flirting with the rain and the 9-month-out-of-a-year-overcast, and lack of jobs aside from Boeing + MS, most Californians had no choice but to move back down. Then, Seattle properties went down 2/3. Ask any Seattle native and he will tell you the same thing, just don't tell them that you are from CA!

Seattle's jobs cannot support the current house price, period. MS is no longer a payroll/stock option powerhouse, Amazon, Starbucks are low-ball employees, Boeing moved its HQs to Chicago. I know how much my Seattle friends are making, but some of the prime areas in Seattle is already at par with the prime areas down here. It is just ripe for an even bigger crash than CA.

I like Seattle, but the current Seattle property valuation just disgusts me. I was reading some article on Seattle Times which claimed that Seattle's property cycle is sustainable because "land is limited", what a big JOKE. Everyone knows that the land supply is virtually unlimited if you drive eastwards along I90 into the Snohomish County. When I was up there, Seattleits kept griping that Seattle was having exactly the same urban sprawl problem as LA. Limited land, yeahright.

"Time to start TAXING people for having kids, not giving them BREAKS (or at least take away the breaks).:"

Amen.

Well, I made an offer on this tiny 1 bed 1.5 loft in downtown San Jose' for $489K (980 sq ft). I could have gotten it year and a half ago for about $300K.

Somebody asked why I thought the prices were expensive back then. Well, 300K is a lot of money! And than I started reading about how Real estate market has maxed out and how people were moving out of the bay area and how doom is near ... Well, last I heard, San Jose' just made the 10 most populous city in the country and I haven't seen an inkling of deflating real estate prices. I guess I'm just tired of waiting. I've been waiting for prices to go down for 6 years.

It comes down to this, no matter what people say, immigrants (like myself) will always come to the bay area (or other metropolis). We're not moving to Lincoln Nebraska. I heard the chinese food there is terrible :). Anway, as long as this great country allows immigrants, the population will increase... mostly in places like the bay area, LA, NY, ... And they're going to need housing. Supply and demand. I predict that housing prices will continue to climb unless Bush builds a wall around North America. I could be wrong, but most of you (especially patrick) has been wrong as long as I've been reading these comments...

Wish me luck...

Well, I made an offer on this tiny 1 bed 1.5 loft in downtown San Jose’ for $489K (980 sq ft). I could have gotten it year and a half ago for about $300K.

Hey man, if you dig the place and aren't looking for an investment device, rock on. If not, you've got big brass balls my friend. Good luck either way.

Damn... I didn't get the place. I got outbid... I really can't go any higher so I guess I'll be renting for rest of my life.

Hmmm... Lincoln Nebraska is looking better everyday.

I could be wrong, but most of you (especially patrick) has been wrong as long as I’ve been reading these comments…

Well, if you expected the market to crash within a day of us putting up the site...

BTW, why downtown San Jose? It is a horrible place.

And Bush is effectively building a wall around America. Greencards are not as attainable as they used to be. There are very few opportunities for new foregin students to stay here permanently nowadays.

For 489K, you can almost get a nice 1BR in Palo Alto. Think about it. Palo Alto. Not crappy San Jose downtown.

Disclaimer: I live in San Jose downtown and I fear for my life every day.

San Jose is tops on my list of places that would benefit from carpet bombing, Berkeley is second. Ahhh San Hosebag, the city without a soul.

San Jose is tops on my list of places that would benefit from carpet bombing, Berkeley is second.

LOL

Ahhh San Hosebag, the city without a soul.

Yep. Zombie city it is.

What is it about San Jose that makes it this way?

I'm going to catch hell for this, but it's the people who are devoid of style and substance, the town which is ugly, filled with sprawl and just ugly, did I mention it's ugly? The gangs, the malise, the police who act like nazis, the polution, the people, the traffic, and now the ass reaming you are taking in housing. Forget it. I don't even buy gas in Santa Clara county, I'll push my car to the next county if I have to.

There might in fact be nice people in San Hosebag, I've just never met them.

What is it about San Jose that makes it this way? I don’t spend much time there, but when I’m there, I just want to leave.

To be fair, I heard that it is much better than 10 years ago...

Still, I do not know what went wrong there. Way too many red light runners. People look scary. Too many younguns. I think it is time to instigate a curfew for teenagers there.

Even Milpitas feels much better than San Jose.

To me, Milpenis and San Hosebag are the same city, same goes for Crapatino.

There might in fact be nice people in San Hosebag, I’ve just never met them.

I live there. But I am not so nice.

To me, Milpenis and San Hosebag are the same city, same goes for Crapatino.

Pretty much. But I feel less threatened in Cupertino.

As crappy as San Hosebag is, it's much much better than Pismo Beach. Whatever you do, don't move here, it's horrible.

As crappy as San Hosebag is, it’s much much better than Pismo Beach. Whatever you do, don’t move here, it’s horrible.

I have been there on my honey moon trip. I liked it. Cracked Crab has pretty good cracked crabs.

Yeah, it seems to me to have a very “concrete jungle” feel to it. Does the sun even shine if you’re anywhere downtown?

It is more like a concrete swamp. It gets super noisy when wind blows from the south and planes take off towards the city.

I have been there on my honey moon trip. I liked it. Cracked Crab has pretty good cracked crabs.

They've paved the whole area and put in a Walmart. I kid I kid, I freakin love it here, beyond beautiful. :) :)

5 years in Lincoln, Nebraska or Des Moines, or Bismarck

Actually it is my understanding that there are a lot of immigrants in these places, work in the meat packing industry.

I suppose I could be shot for saying such a thing, but doesn’t Mexico have restrictions such that an American expat can’t buy beachfront property.

Kind of, you can't exactly buy property as a non-mexican in mexico. It's held in trust by a bank.

See my rants about population above. This is one of my biggest gripes/concerns/pet peeves………and it’s mostly the scariest, dumbest, most financially inept that keep having kids.

Your comment is not without merit. The population mix of the world will reach problematic proportion in a few decades.

In addition to that, I would guess the population of Latinos (not lumping them in with the crowd above) will continue to explode exponentially as their religious beliefs tend to still be of the “a child is a gift from God” sentiment, especially if they are originally from Central/South America.

I see Latino as hard-working people that are generally useful members of the society.

This is a class thing, not a race thing.

I see Latino as hard-working people that are generally useful members of the society.

I'm 1/2 mexican, but as lazy as the day is long, must be the whitey in me ;) If you don't dig the mexi vibe, man, you're in the wrong place, this did, afterall, used to be Mexico. I love Mexico, and the latino culture in general. So warm, such good food. One thing I've never been able to understand, geographically speaking, is why back in the day, we didn't just take all of california, norte and sur, baja should be part of US california.

Portland’s getting there (still very white),

I lived in Porland for a year and half after undergraduate school back in '91. Couldn't stand it, got to where I made peace with myself that it was ok, but god damn dude, they are so fucking red-neck there it's amazing. They put this ballot iniative forward, measure 9, that would declare homosexuality an immoral, perverse behavior, now here's the real kicker, anyone PERCEIVED to be homosexual would be illigible for any type of public job. The fucking thing failed by 51/49. Get this, in the ballot book there were over 100 agruments against, the mayor, governor, etc all against, 3 agruments for, all quoted the bible. Time to go. I'm not homosexual, but do the math man, for every gay dude, well, there's an extra girl for me.

Why downtown San Jose'? Well... let see...

Walk to the new opera house
Walk to the Shark Tank
Walk to PF Changs (just happens to be one of my favorite)
Walk to Sonoma Chicken (my second favorite)
Walk/bike/roller blade on the new Guadalupe Trail (nice tennis courts too)
Walk to the Cinema
Walk to Starbucks
Walk to Improv
Walk to MLK Library (The best in the bay area)
Walk to Adobe (where I work)
Walk to the Vault (Awesome club)
Walk to the new city hall for a leisurely lunch
Grand Prix this summer was awesome
Hang out at the Fairmont on weekends
Something is always going on at the park, the same place where they have the annual "Christmas in the park"
Free summer time concerts and jazz festivals
Voted the safest large city in the country for god knows how many consecutive years

You know what... I'm going to stop here but I can go on forever..
You know guys, there is a reason why the condo prices and the housing prices specifically in the downtown are has doubled within last couple years. There is a reason for everything. People don't spend hundreds of thousands of dollars just for kicks...

All I know is that I didn't get my condo. And NO, I will not move to 50 something lazy downtown Shallow Alto. University ave is dead and compare to downtown SJ, it looks like ghost town. But I'll give you Stanford. Much better than SJSU... but that's about it.

Walk to PF Changs (just happens to be one of my favorite)
Walk to Sonoma Chicken (my second favorite)
Walk to Starbucks
Walk to Adobe

Like I said, San Hosebag has no soul. Glad you like McFood and McCoffee. Me, I prefer the steaming bean, walking to the beach, and not having a bunch of carbon copy trite bullshit formula corporate bullshit nike slave labor businesses to suck my every last dime out of me. I grew up in San Hosebag, it's a shithole, always has been, always will be. What do you get when you gilt a turd? A gold plated shit. But, experiences might vary. Enjoy.

Loved reading the posts about San Jose. For years my husband and I have referred to Milpitas as the armpit of California, I don't even want to guess what you guys would call San Jose. ;)

Milpitas aka Milpenis.

Just an extension of San hosebag with more facist cops.

You know what… I’m going to stop here but I can go on forever..

You can go on forever.

You know guys, there is a reason why the condo prices and the housing prices specifically in the downtown are has doubled within last couple years. There is a reason for everything. People don’t spend hundreds of thousands of dollars just for kicks…

Prices in the Central Valley went up even more... How about Pahrump, NV?

All I know is that I didn’t get my condo. And NO, I will not move to 50 something lazy downtown Shallow Alto. University ave is dead and compare to downtown SJ, it looks like ghost town. But I’ll give you Stanford. Much better than SJSU… but that’s about it.

It is boring in Palo Alto without the risk of mortal danger. It may be a ghost down but there are fewer ghosts of random/non-random violence.

Walk to PF Changs (just happens to be one of my favorite)
Walk to Sonoma Chicken (my second favorite)
Walk to Starbucks
Walk to Adobe

I live in the same block as PF Chang's. There are way too many Gen-Y'ers around there, especially at night.