patrick.net

Atherton, Palo Alto, Los Altos, Menlo Park, Cupertino, Saratoga and in the most part Mtn. View are sought after areas to live in. Big Tech companies surround these cities. Schools are above average in the most part. It seems like the higher you go in elevation, the home prices shoot the roof. Is this sustainable? Probably. Is it practical? For a few. Google doesn't own the southbay nor it pays every new employee $250,000. I am sure the people that actually make a million or two shake their heads with the high homes prices out there generating interests.

There is going to be a point where enough is enough. I don't think it is sustainable. If people are okay purchasing homes at these prices and knowing that they are able to make their mortgage payments for 5-10 years, so be it.

Actually, I almost bought a house for 800K a few months ago but That would mean my wife will have to work for awhile. I grew up with mom at home setting us straight. She made sure we do our homework, chores etc... My wife would rather stay at home and raise the kids. We'll buy in a few months after things settle a bit. It may not be in the Bay Area unfortunately.

KP,

I simply don't see the logic behind retiring to the rust belt, except as an exercise in extreme self mortification.

If money is a problem, retiring to a small apartment/2bdrm house (if violence does become more prevalent in USA as it is in RSA, I'm sure gated communities will spring up for the middle class -- in any case, I don't see why it would be demonstrably safer in Buffalo than in Orlando) in FL or AZ seems more sensible. If that's still too expensive, perhaps renting (since owning can be tricking) in a banana republic.

The rust belt is done -- it's a crappy brown field in a country still full of green fields. Why would any sane businessman open a business in Michigan or Ohio (with their union friendly laws and relatively high taxation) when they can go to the mountain west or the south for similar costs and less headache?

- tricking
+ tricky

Muggy,

I do wonder if the realtors charge more than 3% each for these under $10K listings. If this agent actually goes through with the listing you showed and collected the std fee, the net would be $130.

OpinionsPlease Says:

> FAB - Speaking of Pac Heights, did you not see my link
> in the last thread about a PAc Heights SFH that went for
> $4 mil, vs. 3.5 mil asking? Was on the market for 14 days.
> 5 bidders supposedly. Address is 2707 Laguna St.
> Purchase price in 2005? $1.85 million.

You are correct about the recent sale for $4mm (to a former Robby Stephens guy), but the property (or any property like it in the area) did not “sell” for under $2mm in 2005 (there was a recorded “transfer” by a long time SF RE family to a family trust for $1.85mm in 2005).

P.S. Let us know if you know of a single property that was listed and sold in 2005 (or even 2004) that is selling for more in 2007.

P.P.S. What real estate firm do you work at (your "The SF market is crazy in 2007 already" comment has been in e-mails from many SF reators)?

P.P.P.S. Nice move pretending to not know what a short sale is...

Unless global warming is going to turn Buffalo or Syracuse into a sub-tropical zone, forget about these frozen places. Very soon the residents in the rust belts are going to run out of money for their heating cost.

What do you think will happen when NG and heating oil spikes again? What if there are more frequent snow storms?

If cheap real estate is all you are after, there are plenty of choices in the mining outback towns in Australia with much more pleasant weather, and these places have more jobs you can imagine, and these jobs will be around for the next decade. You can pick up a nice home in Mt. Isa for $100K AUD.

The reason why both coasts are so expensive is because that is where the most lucrative jobs are, and where the job growth is. $20K home sounds great, but who is going to take it over from me for $40K a decade later? Perhaps nobody since I will be the last one leaving town turning off the lights.

Buffalo is well known among the first generation immigrants for one thing and one thing only - the processing center for immigration petition.

Apart from that, I can't think of any reason why anyone will want to live there.

For those retirees with less money, Chile is a good place to check out. I have an ex-colleague who went down to Chile to open a resort and retirement community targeting Americans and according to him, the business is booming big time. Chile has similar landscape and weather as California, only at a fraction of the cost. The only problem is medicare, but in the first couple of decades of active retirement ages, they can fly back to American for treatment. What about later? Well, in 25 years the medicare may be entirely bankrupt so it may not make a difference at that point.

After Different Sean says that his rent is going up 35% in a year Jon Says:

> This is exactly why I favor rent control.
> There’s no benefit to society, as far as I’m concerned,
> forcing people to drop everything and move to a new
> place because some greedy ass landlord wants to turn
> a commodity into a luxury.

Let’s assume that Different Sean’s rent is actually going up 35% in a year. Since Australia has not had 35% inflation or an overall increase in rents of 35% it means that Different Sean has been getting a great deal. If I was renting a 4 bedroom bay view home in Sausalito for that past couple years at $1K a month and the landlord raised the rent to $3K a month I should be happy that I saved $24K in rent over the past couple years…

> It destroys productivity, uproots communities, forces
> children to make new friends at new schools, puts average
> joes in situations of longer commutes or switching jobs, etc.

Very few places in America have rent control yet the percentage of people that move every year due to an increase in rent is in the (very) low single digits (every major apartment owner and manager keeps track of why people leave). In the past 40 years my family has never had even one person move from an apartment or due to the increase in the rent (every now and then an apartment with way below market rents sells and a large number of people are forces to move, but I bet more people win over $1,000 from state lotteries every year)…

> The landlord’s right to make a profit is superceded by the
> tenant’s right to have a stable, predictable, safe and affordable
> living situation. I would flip your landlord the bird.

If any tenant wants a stable safe and affordable living situation they can buy a home in Upstate New York or Ohio for less than $500 a month.

OO,

Perhaps some shrewd businessman can start a medical services business catering to these active retirees, especially for any service that cost less than a round trip flight to the US.

PS - I think southern China (Hainan, Guangxi and Guangdong) will be pretty good for Asian retirees. The summers hot (though less hot than Shanghai and Beijing) but the winters are quite nice. Nursing and servants are dirt cheap. The main problem would be access to high quality hospital care.

As much as I want house prices in the BA to crash, I am not seeing any signs of price concessions in high-end markets of Palo Alto & Los Gatos. Au contraire, prices in PL & LG have risen sharply in the Q1 so far. This is really very discouraging. How can prices in these cities go up when we are seeing large price concessions in all the surrounding areas? Does this mean that I would have to move to a high-end city in LA or San Diego? I personally think that the high-end markets in those markets have more to offer than the BA, and the prices there are falling, or at least they are not going up? What gives?

I see no reason for landlords to be required to subsidize their renters, just as there's no reason for renters to subsidize FB landlords. Each party should adhere to the terms of the contract for the duration of the lease. Great if the LL/renter relationship turns out to be a mutually beneficial long term relationship, but certainly no a moral obligation to forgo profit.

If you REALLY want to rent long term, find a long time landlord like FAB's parents, offer 10% above the market rent, agree on a benchmark for future rent increases and ask for a really long lease (which also means you'll pay big penalties if you break the lease).

Otherwise, take your chances.

Moving is a hardship for people with kids. For singles and DINKs, it should be no more than a nuisance - $400-1,000 for movers and 2 weekends packing up the delicate stuff.

I would think that a long-term lease is a bigger advantage to the LL than to the renter, therefore, it should be 10% below market value.

goldboy,

what are you talking about? The high-end markets of Los Gatos is NOT moving, the multi-million-dollar homes just keep sitting. Even for those in the LG district that are moving, price is not going up. The trailer-park converted Creekside Village for example, used to sell for $920K at the peak, now you can pick one up for lower than $850K.

As for the rest, only the sub-$1.5M home in the LG/Saratoga school district is moving. LG homes in the Moreland school districts are NOT moving either.

Right now, it is all about the school district, not the address. You can have Saratoga on your address, but if you are one of those Saratoga addresses east of 85, the odds are, your house is not moving.

I do not feed race baiting trolls.

OO: But why is zillow showing an 8% y-2-y increase in the median prices in LG? What's depressing me even more, is that the house I sold in the early summer of 2005 in Almaden, which was suppose to be close to the peak, is now showing over $250K higher than what I got for it. Is this a total insanity or what?

goldboy,

I agree that your scenario is more likely in a normal market. I was speculating on the BA market, where lots of the rentals might be flips in disguise and LL would prefer short term lease so they can kick out the tenant quickly.

Opinions,

Your posts are identical in tone and content to 'ConfusedRenter' who finally admitted to being a realtor after pretending to be an innocent renter merely wanting information. Absolutely identical in language, phrasing, content, tone and style. That is probably why he thinks you are a Realtor (TM).

KP,

I grew up in the Finger Lakes area, and my little brother moved back up there a few years ago. It is gorgeous, drop dead gorgeous, in the spring, parts of the summer and early fall. The winters, however are killer.

My brother bought a beautiful fixer upper. He calls it a colonial, I think it's actually a Greek revival. It's on an acre and a half, water views, the house is large, and it only cost a little over $250,000 a few years ago. He did some renovating and upgraded the insulation, etc.

The houses are inexpensive, but heating the house isn't. It is a minimum of $1000/month for him to heat the place. It can get a lot higher. Heating costs could be very difficult on someone on a fixed income. He and his wife love it there, but I notice they do take pretty frequent trips to NYC or Florida.

astrid: but I see very little bites in the rental market right now. The house across the street from where I rent now in Los Gatos, had the FOR RENT sign on the lawn for over a year with no takers. Finally, they decided to sell it. I guess there is lot's of inventory because of these so-called "flippers" who got trapped.

goldboy,

I'm glad to hear that and sincerely hope that is the case! I'm not in the BA right so my speculation could certainly be completely off. Anything to convince a good family friend from making the worst financial mistake of her life.

I should clarify that a bit more. I'm trying to persuade this friend to rent for a couple years in a good school district before buying. If there is an abundance of multi-year leases, that's certainly a good thing.

SFWoman: You beat me to the punch. OpinionsPlease sounds exactly like ConfusedRenter. In fact, I'm fairly certain that the two are the same person. Ever notice that ConfusedRenter doesn't post anymore, but we have a new "innocent" RE troll posting "This property sold for 150% of asking, I just can't explain!" every couple weeks? How many times can the same person have a "conversion" experience where they talk themselves out of believing in the real estate bubble with bogus "evidence" of properties selling over asking price?

astrid: yes but it seems that the asking prices are completely detached from the supply/demand curve. Haven't these sellers taken Econ-101? Maybe they are all hoping for the bigger fool, but the bigger fools keep coming and coming, and they scooping up these homes at these outragous prices. All of the people I talk to, seem to be buying into this "we've reached the bottom" talk from the RE Cartel.

SFWoman says: The houses are inexpensive, but heating the house isn’t. It is a minimum of $1000/month for him to heat the place. It can get a lot higher (in the Finger Lakes).

Come on, $1000/month? Either his house has terrible insulation, or he needs to get a wood burning fireplace or pellet stove.

Brand,

I can't comment on SFBrother's insulation or HVAC, but I know my mom's coworkers regularly have $600/month natural gas bills in the winter months for 2,000 sq ft SFH. My parents' cardigan wearing ways save them at least $400/month during the winter.

Goldboy,

Yeah, it sucks to be the raving Cassandra character.

AZ homeowner,

Agreed. Heat and lack of water are the major constraints to growth in the Southwest. I wish the local planning people were more imaginative about building to climate type (more adobe, strawbale, underground and solar power; less two story foyers).

KP,

I share some of your pessimism, though not quite the Mad Max results(at least not the first wave - I think ghettoizing the immigrants and crowding the public health/public school is the more immediate concern).

If I ever have kids, I'm likely to move out of this country. The US has a highly illogical immigration policy.

The psychology of a soon to be FB

To OpinionsPlease,

4 bedroom home in Northern NJ asking $590k in May 2005 is currently asking $435k. Owner was made an offer of $390k last week, countered with $410k and never heard from the buyer again. Will be interesting to see how much more he drops his price at the end of this month.

Meanwhile, some friends who put a lowball bid on another place in same area just found out that it was foreclosed upon and owned by the bank since Dec. Funny how not even their realtor knew about this until they put in a bid. I can understand why the bank was not forthcoming with this information. The mls however still listed the former owner. Sneaky little devils.

My advice to you is to get another job while you can. You'll have a lot more competition after the spring. Perhaps you can try astrology. You already have a talent for coming up with bullshit.

Roving bandits is a reference to a time in the future when the American dream disappears and the youth are in gangs, roving from one temperate region to another, looking for gated communities to pillage.

That's okay, at that point I will have stockpiled enough gold, food and ammunition to escape to Canada. Then I will build a giant robot with chain cannons and missiles, and re-invade Colorado. I will blast the bad guys just like a bad Sci Fi movie, eventually claiming the gorgeous heroine and kingship of the Front Range.

Or perhaps you have claimed the gorgeous heroin...

Brand,

astrid DEMANDS ray gun eyes!

"Well, what happens when enthusiastic youths discover that the dream is a myth?"

Time to invade Mexico? Or maybe Soviet Canuckistan...they don't have weapons of mass destruction yet, right?

Sorry to be so glib.

astrid, will your raygun eyes be a part of your destroyer robot, or will you be genetically mutated by the plague that sweeps America while the gangs are running free?

Frankly, I am looking forward to the anime future of America. I will have a huge anti-troll gun that can freeze white trash racist trolls. Their eyes will bulge for a long moment before they explode into a hail of ice splinters. And then I will say something witty in my cockpit, but it probably won't sound that cool in the dubbed English voice.

And in a moment of serious debate--I thought the goldbugs on this forum were paranoid. I guess a couple bad days of the stock market gets us to the ammo and ration bar crowd?

Opinions,

I didn't ask you about a ski house, ever. I simply said your posts are identical to those of ConfusedRealtor's.

CB asked you about the ski house a few times, and FAB thinks your posts smell suspiciously of booster-ism. Go back and read some ConfusedRenter posts. Identical.

Brand,

My brother did significantly increase the insulation in his place after he bought it. The house has regular fireplaces, so a pellet stove or wood burning stove wouldn't really fit in or have a space without taking out a regular fireplace (which I don't think either my brother or sister-in-law would ever do), but getting one of the EPA heater rated fireplaces would be a good idea for them. They did replace one of the wood burning fireplaces with a gas (propane??) heater rated fireplace (the kind that have a fake ceramic log with gas flames), but the rest are still regular wood fireplaces.
At one point that whole house was heated with those fireplaces, imagine how it must have been living in it back then.

KP,

Well, the important thing is that it works for you and your family. However, you think you should recognize that it wouldn't work so well for many others. I would also worry about leaving a house empty all winter.

naturopath = astrologer of the body???

Brand,

I was thinking of gigantic robots with raygun eyes, but I'll be, ergh, happy to accept the latter :) Cyclops is probably my favorite X-Men.