patrick.net

rowemoore says

California is easily the best state in the union. Does it have problems, sure. But short of falling into the ocean, there is nothing that will stop it from remaining so. Captain, where do you live? Texas, Idaho or some other god forsaken place?

I've lived all over. With kids, this is the worst state. And most homes are moldy, asbestos ridden tiny pieces of junk with garbage schools. The infrastructure is collapsing under the load and the quality of life stinks for those not in the one-percent club.

I'd rather be poor and free then be enslaved to this horrible place with the best marketing team inflating its value.

Family and friends is the most important thing. The bay area is about money. Nobody is friendly anymore, families often have 2 to 3 jobs, and the kids are all latchkey. This system sucks.

Mick Russom says

The obsession with unearned income in the US and Bay Area is killing the ability for people who do work for a living to maintain the rentier class's lavish lifestyle.

If you don't approve of unlimited untaxed unearned income extracted from working class labor that means you are a SOCIALIST! At least according to the Republican Party.

dunnross says

Ask some people from Chicago what they think about California. They say, California is full of fruits and nuts, and they aren't talking about the agriculture.

I moved from Chicago to California, and my boss's first comment when I said I was leaving was "But California isn't real. Chicago is real."

Chicago is very real. Too real for me. I still love Chicago in spring and fall, but not in winter or summer. When I'm rich I'll have an apartment there for visiting.

California is like a very beautiful but stupid woman. Kind of painful and expensive to deal with at times, but just looks so damn good that you forgive it. Can't have everything.

chemechie says

the national average house is about $140k (IIRC); what about the BA makes it worth 4+ times the average?

A lot of people say it's because there is a lot of money floating around here. Well, if that was really true, than everything else would be 4x times more expensive. But you don't see gas or food prices 4x more expensive than everywhere else. I don't pay more for medical care here, than my friends do in Chicago. Clothes isn't more expensive. Cars aren't more expensive. Its just houses are 4x times more expensive + they are 4x worse in quality than everywhere else.

Mick Russom says

Nothing quite like living on unearned income, like taking peoples hard earned just scraping by money and living off of them.
The obsession with unearned income in the US and Bay Area is killing the ability for people who do work for a living to maintain the rentier class's lavish lifestyle.

Oh come now, that's what America is all about: getting rich at someone else's expense. Ask any black guy how that works. Or any native American. Or any white guy who's ancestors worked in coal mines or steel mills in the 1800s.

If you don't approve of unlimited untaxed unearned income extracted from working class labor that means you are a SOCIALIST! At least according to the Republican Party.

Well said.

rowemoore says

When it comes time to sell, you may feel differently.

The school district was the same when he bought it, so that cancels out:

Bad school district = discount when you buy, discount when you sell
Good school district = premium when you buy, premium when you sell

You get exactly as much as you give, so there's no need to feel good or bad about it.

If both goes up by 10%, gain for the premium one is higher in absolute dollar. Just for illustration:
Price Bad school district Good school district
-----------------------------------------------
Buying $400,000 $1,000,000
Selling $440,000 $1,100,000
-------- ----------
Gain $40,000 $100,000

dunnross says

Clothes isn't more expensive. Cars aren't more expensive. Its just houses are 4x times more expensive + they are 4x worse in quality than everywhere else.

Supply of houses are limited. Plenty of choices for cars and clothes. Law of supply and demand.

wthrfrk80 says

Oh come now, that's what America is all about: getting rich at someone else's expense. Ask any black guy how that works. Or any native American. Or any white guy who's ancestors worked in coal mines or steel mills in the 1800s.

The whole world knew that. Other nations are awakening and are responding accordingly.

Our way of life where we paid peanuts for other nations' labor and then sold them products at high price is fading. Going forward, our life could be a lot tougher than previous generations.

hanera says

If both goes up by 10%, gain for the premium one is higher in absolute dollar.

Yes, they both could go up by 10% and the more expensive house would gain more. But if you assume that, then you are assuming an ever-larger divergence in prices.

hanera says

Law of supply and demand.

Not entirely. We also have much higher jumbo loan limits here in CA, to encourage people to prop up the ultra-high prices via ultra-high mortgage debt:

Seven Bay Area counties currently have ‘high cost’ conforming loan limits at the national maximum of $729,750.

http://bayarearealestatefinance.com/when-do-conforming-loan-limits-change/

Or has that been reduced a bit now?

The real injustice is that people in the Midwest are forced by federal law to guarantee ridiculous mortgages in California, amounts far beyond anything people in the Midwest themselves are eligible for.

2 years after a short sale and your credit is good enough to buy and you have a nice down payment?

I'm an idiot. I'm actually mad at you Patrick for convincing me not to buy during the bubble.

hanera says

dunnross says

Clothes isn't more expensive. Cars aren't more expensive. Its just houses are 4x times more expensive + they are 4x worse in quality than everywhere else.

Supply of houses are limited. Plenty of choices for cars and clothes. Law of supply and demand.

And I suppose, supply of gas is also unlimited. Actually, for those of you who think that supply of land is limited in the Bay Area, I invite you to get off your ass, and travel to a place like Monte Carlo or Honk Kong, to see what a place with limited land really looks like. After you come back, you will see that there is plenty of land in the Bay Area.

The real injustice is that people in the Midwest are forced by federal law to guarantee ridiculous mortgages in California, amounts far beyond anything people in the Midwest themselves are eligible for.

What about the fact that we pay the same federal tax rate in a place where the cost of living is so much higher. And besides, most flyover states take in more federal dollars than they pay.

http://motherjones.com/politics/2011/11/states-federal-taxes-spending-charts-maps

Rowemore is the moron. You must employ illegals yourself to attack me. "When you have no basis for argument, abuse the plaintiff."
I didn't say illegal aliens sometimes are not hard workers. Of course they work to make money. The minimum wage today in mexico is about 6 bucks, per day.
The family loving comment made me laugh but in another post I will tell you some interesting heartwarming stories. They are no different than we, the *functional families* appear great. You wouldn't often know anything about the dysfunctional ones, however I do since I met so many people when I lived there.
Either way, they are just one reason you want to be wondering about the future of California real estate, taxes, debt, and economy.
As I mentioned previously, although a college education is essentially free in Mexico, most Mexicans are high school dropouts.
This of course is the polar opposite of China for example.
Everyone who believes that the people south of the border are NOT capable of sitting through classes and studying is of course the bigot racist, not I. I believe that every kid can sweat out school if he is not rewarded for dropping out with a job in the US.
There is physical laziness and intellectual laziness and ignorance. Neither should be rewarded.

dunnross says

hanera says

dunnross says

Clothes isn't more expensive. Cars aren't more expensive. Its just houses are 4x times more expensive + they are 4x worse in quality than everywhere else.

Supply of houses are limited. Plenty of choices for cars and clothes. Law of supply and demand.

And I suppose, supply of gas is also unlimited. Actually, for those of you who think that supply of land is limited in the Bay Area, I invite you to get off your ass, and travel to a place like Monte Carlo or Honk Kong, to see what a place with limited land really looks like. After you come back, you will see that there is plenty of land in the Bay Area.

Supply of houses NOT supply of land.

jessica says

I'm an idiot. I'm actually mad at you Patrick for convincing me not to buy during the bubble.

Well yes, fraud is definitely more profitable if you can get away with it. Sorry about that.

clambo says

Rowemore is the moron. You must employ illegals yourself to attack me. "When you have no basis for argument, abuse the plaintiff."

To begin, I was commenting on the fact that you insulted the op by saying you felt sorry for her husband.

But having read the rest of your comments, I have no problem standing by my description of your intellect.

jessica says

2 years after a short sale and your credit is good enough to buy and you have a nice down payment?

I'm an idiot. I'm actually mad at you Patrick for convincing me not to buy during the bubble.

I am still wondering why your kinda comment was not the first on this thread. Seriously,no offense to OP,but I am amazed at your guts of getting out on a short sale and getting into buying that fast.

rowemoore says

California is easily the best state in the union. Does it have problems, sure. But short of falling into the ocean, there is nothing that will stop it from remaining so. Captain, where do you live? Texas, Idaho or some other god forsaken place?

They should call it the Stockholm State.

I guess you folks just feel like it's worth it for the by chance happenstance you might run into a movie star at 7-11 buying a pack of smokes.

rowemoore says

And besides, most flyover states take in more federal dollars than they pay.

True, because those crops grown in the "flyover" states must get to the population centers somehow. Usually that's done with roads. Do you want to privatize the road network?

hanera says

Supply of houses NOT supply of land.

Right ;) I guess, construction workers are much more expensive these days than either doctors or petroleum engineers.

dunnross says

hanera says

Supply of houses NOT supply of land.

Right ;) I guess, construction workers are much more expensive these days than either doctors or petroleum engineers.

Please refer to orbitron's post #50 on houses, land and built-able lots.

Condohelp says

I'm also concerned about all of the IPOS in the silicon valley and all of the wealth that gets pumped through this area.

very little concern to have.. this isnt 1998-1999 with a tech stock bubble. There is a very very big difference.

to give you a perspective.. lets take a 'no one ever heard of company stock' like Invensense... and give it a stock price of say $450 or 650/share. Amd lets have maybe 50 other companies have similar situations. Today, at best you have only LinedIN with PE at 900x next years earningsm, which means at best its really worth less than $5 per share and not $100 per share.

http://finance.yahoo.com/q?s=INVN

You talk of wealth, but the reality is its the stock buyers major Loss... Yahoo at say $350/share in 1999 which goes down to $15-20/share. What wealth ?

The real injustice is that people in the Midwest are forced by federal law to guarantee ridiculous mortgages in California, amounts far beyond anything people in the Midwest themselves are eligible for.

Its the same midwest and eastern people who have came to California and became bullish on prices creating the bubble... did you see Californians overbid overpay to the same extent back in the late 80s and early 90s. But you are right people in the Midwest and East coast who will paying the bill. It all depends who you call a Californian.

Can I say something unpleasant?

we are renting a 3 bedroom and 2 1/2 bath townhouse with much more space. ... I don't plan to work as soon as we have children

You don't have any kids yet, so it's just the two of you, yet you rent a massive townhouse with three times as many bedrooms and two and a half times as many bathrooms as you actually need.

Since you're planning to not work (your husband is OK with this, isn't he?), my suggestion is to buy a 2BR condo within walking distance of your husband's job. If he can get home right away every day, he'll be a lot less exhausted and a lot happier, and when your family has one breadwinner, that person has to be happy. Make the second bedroom the eventual kid's room. Trying to "stretch" to buy something even more expensive than you can afford now, then dropping down to one income, is sure to make the earner of that income feel like a slave or beast of burden. Don't buy more house than you absolutely need.

Are you planning to have a second child? If so, and if this child is the opposite sex of your first, then yes, years down the road you'll eventually need a third bedroom, but you certainly don't need that now, while you're renting.

You blame your husband for making a "mistake" in purchasing a 1BR condo that left the two of you "stuck in such small quarters". Millions of newly-married couples and soon-to-marry couples live in that kind of space. That's just sensible home buying. JVolstad knows what's up: don't let Suzanne talk you into buying something you can't afford and making your husband miserable. Small and convenient is the way to go.

wthrfrk80 says

rowemoore says

And besides, most flyover states take in more federal dollars than they pay.

True, because those crops grown in the "flyover" states must get to the population centers somehow. Usually that's done with roads. Do you want to privatize the road network?

I'm not a libertarian, just a sixth generation Californian who is tired of all the haters.

Ironically, California has been the #1 agriculture provider to the US for like a half a century. We could do just fine without your corn...

BTW, if it makes you feel any better I think NYC is the greatest city in the world.

Austinhousingbubble says

http://www.guardian.co.uk/world/2012/jan/09/texas-police-schools

From the article..."In 2010, the police gave close to 300,000 "Class C misdemeanour" tickets to children as young as six in Texas for offences in and out of school, which result in fines, community service and even prison time. What was once handled with a telling-off by the teacher or a call to parents can now result in arrest and a record that may cost a young person a place in college or a job years later."

Loving it! thats one way to put some discipline in schools and put the hammer down on bullies..

CaptainShuddup says

rowemoore says

California is easily the best state in the union. Does it have problems, sure. But short of falling into the ocean, there is nothing that will stop it from remaining so. Captain, where do you live? Texas, Idaho or some other god forsaken place?

They should call it the Stockholm State.

I guess you folks just feel like it's worth it for the by chance happenstance you might run into a movie star at 7-11 buying a pack of smokes.

We don't smoke in California.

thomas.wong1986 says

Loving it! thats one way to put some discipline in schools and put the hammer down on bullies..

but...no...that's not how it works in the final analysis. If you read the article, it was actually the subject of repeat bullying who was caused the most mental anguish thanks to this crazy assed policy.

rowemoore says

Ironically, California has been the #1 agriculture provider to the US for like a half a century. We could do just fine without your corn...

You may get your wish. If demographics are any indication, California will become part of Mexico within the next 50 years. Like it was before the Treaty of Guadalupe-Hidalgo.

Bad school district = discount when you buy, discount when you sell
Good school district = premium when you buy, premium when you sell

You get exactly as much as you give, so there's no need to feel good or bad about it.

Areas & school districts can always change...

Austinhousingbubble says

thomas.wong1986 says

It all depends who you call a Californian.

Most of the greatest and even iconic Californians I can think of throughout history weren't from there.

That's true. California has always attracted the intelligent, creative and adventurous people who were itching to escape the god-awful states they were born in.

rowemoore says

That's true. California has always attracted the intelligent, creative and adventurous people who were itching to escape the god-awful states they were born in.

Until about ten years ago. Now it's just attracting illegals.

wthrfrk80 says

rowemoore says

That's true. California has always attracted the intelligent, creative and adventurous people who were itching to escape the god-awful states they were born in.

Until about ten years ago. Now it's just attracting illegals.

I agree. Guys like Mark Zuckerburg should be deported.

In fact, illegal immigration is down and now that employers are under increased scrutiny to hire legals, this trend will continue. But if the threat keeps folks living in fly-over land from moving here, I encourage you to keep spreading the fear to all your friends.

E-man says

So Condohelp,

The housing crash is over. It is stabilizing in some areas, slowly increasing in some areas, and slowly decreasing in some ares.

Forming a right shoulder.

rowemoore says

But if the threat keeps folks living in fly-over land from moving here, I encourage you to keep spreading the fear to all your friends.

Folks in "fly-over" land aren't planning on moving to CA in the first place. They know it isn't smart to pay $500,000 for a run-down shack in a bad neighborhood. They aren't suckers.

wthrfrk80 says

rowemoore says

But if the threat keeps folks living in fly-over land from moving here, I encourage you to keep spreading the fear to all your friends.

Folks in "fly-over" land aren't planning on moving to CA in the first place. They know it isn't smart to pay $500,000 for a run-down shack in a bad neighborhood. They aren't suckers.

So, the illegal immigrants are suckers?

It's true California is an expensive place to live. Maybe where you live a home can be had for very little. You get what you pay for.

rowemoore says

Maybe where you live a home can be had for very little. You get what you pay for.

I get what I DON'T pay for. I get far MORE here for far LESS money compared to CA.

But hey, if you want to live in a run-down shack with no yard in a bad neighborhood...and pay half a million for the privalege, that's your business. Enjoy a lifetime of debt-serfdom to pay for it. Some banker will get rich off your labor.

I hope the nice weather* makes up for it.

*except there's no rain during the warm season, which is when you need it for growing things

The real injustice is that people in the Midwest are forced by federal law to guarantee ridiculous mortgages in California
For foreign-born (legal) immigrants*. CA has a net out migration of people born in the US.
*CA is in trouble if the world starts thinking like the rest of the US.

Rowemore it's true I was slightly impolite to the lady for making my comment. Think of me as the Greek Chorus that you find sometimes inconvenient but that also makes you think. I still pity a guy who has a wife asking strangers on the internet important questions. To each his own.
You of course don't like me because you 1. hire illegal aliens 2. have a wife. 3. justify breaking laws because you have the responsibilities of marriage and all the rest of it.
RE: The weather in California. Truly it's a nice climate weather wise. But, have you spent the winter of 82 and 83 here?
The rain was incessant and so depressing. The rain started in October and never stopped I think until May, but I actually cannot remember.
I spent a winter in Connecticut in a quaint town for one year a while ago. It was interesting that there were many sunny days although there were cold days. The cold was however not so intolerable compared to the damp cold here in Santa Cruz. Snow is a pain in the ass to drive around in, but it's also beautiful.
Springtime was incomparable because the tremendous flowers and dogwood trees, etc. made perfume. I called up to tell my friends "I'm walking around and it actually smells like flowers as I am walking!"
Summer is humid and warm, but it also feels like summer. Santa Cruz summer feels like October in Corning NY much of the time, depending on how foggy our summers are.
Going out at night is a freezing experience here. I dated a hot asian woman in San Francisco once and I had to wear my coat every time I was up there during the summer nights. It's goddamm cold.
Generally where I live the climate is like September on the East Coast, so it's pretty nice. But, for up to 5 months per year it's rainy and nasty. The last winter was the driest in over 35 years but we may have another "el nino" and watch out.
I don't know Corning but have been often to Cazenovia and environs besides New England. It's nice and the people are nice.
Americans in California sometimes have the experience of feeling like a foreigner in their own country. It's sometimes fun and interesting and later it's sometimes tiring.
Incidentally, the Mexicans know they're ripping us all off. They believe Califorina was stolen from them, and they also believe that poverty in Mexico is our fault, so it's justified in their feeble minds.