patrick.net

CrazyMan says

I'd like to add that the company I contract for is ~80% EE PHDs and quite frankly the majority of them have the common sense of a turnip.

Of course some of them are absolutely brilliant, but it stands for paid high dumbass for a reason.

This is precisely why the BA is so ridiculously expensive. As I have been saying for a long time, you don't have to have any financial sense to make a lot of money. Start handing 6-figure salaries to people that find a way to live paycheck-to-paycheck, BEFORE buying a house, add 3.5% FHA loans & other creative instruments, and voila, you have stupid high RE prices!

Crazy,
Like bmwman bimmerman says, I am office mates with those folks but i don't drink their Cool Aid. I am more like you than like them but like bimmerman says it is what it is and many of them will diss you off inside of their minds as being jealous.
It's sad really when you think of it. In the extreme, we wind up with things happening like what happened at Siport or on the train tracks near a local high school.

When you guys say buy, you really mean borrow, right? I mean you don't actually have the money for the house... and if you did,.. then you would just borrow for a bigger house , right?

E-man says

You guys like to rent and save money. We like to buy real estate and save it. It's just a different form of saving.

Sure. I have no problem with anyone buying a house to LIVE in it, and to pass it on to children. That's what houses are supposed to be for. My gripe is with all the dummies that saw houses as ATM machines and quick money makers (and many that still do). Doling out loans to people that can barely save 2 months worth of income to buy $700k houses is also a big problem.

I wish to have a house someday for my own reasons (garage for woodworking & car projects, no attached walls so that I can fully enjoy my speaker-building hobbies). I rent apartments (relatively) cheaply to save money faster so that I can eventually buy what I want to live in. I could rent a house now, but that is prohibitively expensive!

bimmerman, your comments about your inlaws' values speak volumes about the outlook for your intended union.

Good luck.

B.A.C.A.H. says

bimmerman, your comments about your inlaws' values speak volumes about the outlook for your intended union.

Good luck.

I didn't mean to imply that my in-laws are the folks that I have a "cultural disagreement" with. Her dad is slowly understanding the whole idea that here, a house is just a house. Her family is mostly all here anyway, and has been since the 1980's, so they are about as American as anyone (except they seem to eat healthier lol). We all get along fine, and I never get hassled about the house thing personally (her dad nags her about it). Perhaps there was a little exaggeration on my part about her dad's outlook. The segment of her family that I have met is a bunch of nice good people. There is another segment that I have never met, and nobody talks to because they sort of put money before family in the past...and they live 6500 miles away so it isn't really an issue anyway. I wouldn't be marrying her if her family wasn't solid since you marry more than just the individual!

bmwman91 says

it IS true that housing here is a bargain for anyone that lives in HK and has any money.

RE prices in major cities of Asia is very expensive. For example, the price/rent ratio in Sentosa of Singapore is 764. S$17.6 mil (US$14.1 mil) for a house on a 8000 sqft lot size.

Source: http://www.propertyguru.com.sg/listing/5447781/for-sale-warm-welcoming-balinese-style-bungalow.

Helloeeze says

... why do white guys marry Asian women so often?

And yet hardly any white gals marry Asian men?

bmwman91 says

Second, it is highly likely that all this FB IPO jazz will be largely done & over with by then. From talking to a friend that works there, they have to have their IPO in the next month or so, since employees can't sell until 6 months later. Well, the top tax bracket's tax cuts expire on 12/31/12, anf FB wants its employees to be able to sell off their vested RSUs before the rate goes up. So, the market will get a few hundred, or thousand perhaps, new-monied folks looking for houses right around election time, and I am willing to bet that they will have spent it on housing by the time the inauguration rolls around.

I don't know...in the IPO-rich 90's, I don't remember housing shooting up that much -- maybe the upper upper end will see a little thrust, but I think this is mostly an overplayed scenario.

For the original poster -- I'm in your boat. I just renewed the lease on my baby-shit green hovel, as I see nothing worth a damn out there, and no good lots to build on. I've been saving for the last four years. I had been saving and looking to buy in 2003-4, but backed away from that plan for obvious reasons. Spent the money on other stuff, and then started saving more seriously in mid-2008. Most of our salaries, plus every bonus, every ebay sale, every freaking onesy-twosy surplus. The biggest expense this year was paying my income taxes and replacing the transmission in my '89 Volvo. My savings habits have gone beyond frugality and well into abstemiousness. If most of Americans enjoy wealth effect, I enjoy something like poverty effect! The crisis I am encountering right now is that longer I defer gratification and live beneath my means in this way, the more my expectations rise in tandem. I find myself thinking, "is this really the dump it's all been for?" about places I would have readily considered even two or three years ago. I know I can't be alone in this.

E-man says

We're more than happy to work two jobs so we can pay-off our mortgage early

Most bay area real estate results in a 625k loan. No amount of multiple jobs will ever pay that off. In fact, the people I see with the most money do nothing, its unearned, massive bonuses or massive capital gains. Working like a dog is not going to pay off a house.

1sfrenter says

how long do you expect to wait?

Patrick designed and operates a website devoted to this question.
Our gubmint decided to manipulate prices to mitigate damage caused from over-lending & over-borrowing. We will never know who would have suffered the most between citizens & financial institutions, if gubmint did NOT intervene.
No one knows the exact year that Real property will once again begin to appreciate. But we ALL agree, values are still being artificially propped up by centralized gubmint. Hopefully, our grandchildren will not be asking why housing keeps falling ?
What OUR gubmint ignores is the fact, that banks lack morality. Does that make you wonder who the gubmint is working for ?
Miss a few payments ? banks demolish your home.
Gubmint gives bank your tax money.

Helloeeze says

Btw, why do white guys marry Asian women so often?

my own experience:
1. from the guy's perspective: asian women usually have less attitude than white women(less hassle)
2. from the asian girl's perspective: asian women want to be white and can move up in class (an economic decision). white guys are more generally masculine than asian guys making them more physically attractive

the guy and girl both see benefits, for the small price of getting used to a different race.

E-man says

We are not into selling to upgrade into a bigger home. We tend to keep the small home in the family or rent it out, but not sell it.

So, who was selling in Hong Kong, when house prices dropped 70% back in 97-03. Where these not Asian people?

Helloeeze says

Btw, why do white guys marry Asian women so often? What attracts men to marry a woman of a different culture?

Hysteresis says

asian women want to be white

from
http://en.wikipedia.org/wiki/Asian_fetish

In 2007 economist Ray Fisman, in a two-year study he co-authored on dating preferences among Columbia University students, did not find evidence of a general preference among white men for Asian women. Furthermore, the study found that there is a significantly higher pairing of white men with East Asian women simply because East Asian women discriminate racially against Asian, Black and Hispanic/Latino men. As quoted on Slate.com,[14] and also reported in The Washington Post and the Review of Economic Studies (a publication of the London School of Economics):
“ We found no evidence of the stereotype of a white male preference for East Asian women. However, we also found that East Asian women did not discriminate against white men (only against black and Hispanic men). As a result, the white man-Asian woman pairing was the most common form of interracial dating—but because of the women's neutrality, not the men's pronounced preference. Men don't seem to discriminate based on race when it comes to dating. A woman's race had no effect on the men's choices.

The study was carried out over two years and was conducted by economists Ray Fisman (lead researcher from Columbia University) and Emir Kamenica (University of Chicago), as well as psychologists Sheena Iyengar (Columbia University) and Itamar Simonson (Stanford). They took data from "thousands of decisions made by more than 400 daters from Columbia University's various graduate and professional schools."[14]

It's no wonder why Tiger Moms will run themselves and their spouses ragged to secure their kids a slot in a school district that is free of blacks and hispanics.

bmwman91 says

There is another segment that I have never met, and nobody talks to because they sort of put money before family in the past...and they live 6500 miles away so it isn't really an issue anyway.

I laughed out loud when I read this because I could've written it myself, about some of my partners' remote relatives.

dunnross says

E-man says

We are not into selling to upgrade into a bigger home. We tend to keep the small home in the family or rent it out, but not sell it.

So, who was selling in Hong Kong, when house prices dropped 70% back in 97-03. Where these not Asian people?

The years after 1997 in HK are anomalous -- didn't people leave in droves when HK was given back to China?

B.A.C.A.H. says

They took data from "thousands of decisions made by more than 400 daters from Columbia University's various graduate and professional schools."[14]

i would think taking a sample strictly from Columbia University's graduate programs would bias the results - the sample is extremely educated compared to the general population. while racism exists at all levels, the less informed and less educated often have greater discriminatory biases.

Hysteresis, could be.

On the other hand, Bay Arean patrick.net bloggers are probably more akin to the Columbia cohort than your Bubba Belt cohort.

B.A.C.A.H. says

Hysteresis, could be.

On the other hand, Bay Arean patrick.net bloggers are probably more akin to the Columbia cohort than your Bubba Belt cohort.

columbia is a world renowned ivy league in NYC.

i'm not sure if patnet readers are closer to the bottom of the barrel or the top. maybe you're right and we're slightly closer to the top but then i wonder if we're just flattering ourselves. lol

The discussion has taken an interesting turn. By odd coincidence, my girlfriend was Chinese from Shanghai and she was perhaps the epitome of driven hard working and eventually bossy woman.
She insisted I was "throwing away" money but I resisted to take my *capital* and buy a place in Monterey or environs. I told her to come up here and commute down. Nope. She had other plans, her friends had parents and relatives come on long visits for vacation, etc.
She also had interesting stories from Shanghai. Her aunt asked her for money because her cousin had lost a shitload of money gambling. My gilfriend's Shanghai ex-fiance had blown his money in similar fashion, and with no money she told him to find another girl.
Everyone knows that if they had a huge chunk of change or income, etc. a house with a view would be the second purchase after a Lambo or BMW. The point is how much debt you want to service.
In this country, you can get ahead. The parents who plan on leaving fortunes to their children or houses, etc. to them are missing the point. Let them sink or swim unless of course they have an obvious handicap.
What I saw in her and some other ladies was the odd combination of frugality and savings while wanting to take huge financial risks also.
She told me why not buy a house in Vegas? Her friend had done so.
"Because I don't live in Vegas for one reason." I replied.
The pressure started in Oct. 2009 I think and later I would email her from time to time about the differences in AAPL price and house prices down in Monterey or Marina.
They joke in China about women from Shanghai being bossy, and that the men wash the woman's panties there.

Michinaga says

dunnross says

E-man says

We are not into selling to upgrade into a bigger home. We tend to keep the small home in the family or rent it out, but not sell it.

So, who was selling in Hong Kong, when house prices dropped 70% back in 97-03. Where these not Asian people?

The years after 1997 in HK are anomalous -- didn't people leave in droves when HK was given back to China?

And, I suppose, Japan was also anomalous.

What's also interesting is that in Japan there was so little supply and yet prices still fall.
My ex GF lived in a suburb of Tokyo. Her parents had to win a lottery to be privileged to buy their house. The house was pretty nice and the thing was probably worth a gazillion bucks around 1991.

clambo says

What's also interesting is that in Japan there was so little supply and yet prices still fall.

My ex GF lived in a suburb of Tokyo. Her parents had to win a lottery to be privileged to buy their house. The house was pretty nice and the thing was probably worth a gazillion bucks around 1991.

Exact same thing is gonna happen to USA. 2006 + 20 years. We have screwed ourselves for until 2025,whether we like it or not,that is what it will be.

bubblesitter says

clambo says

What's also interesting is that in Japan there was so little supply and yet prices still fall.

Exact same thing is gonna happen to USA. 2006 + 20 years.

Please refer to this chart: http://www.google.com/publicdata/explore?ds=d5bncppjof8f9_&met_y=sp_pop_totl&idim=country:JPN&dl=en&hl=en&q=population+in+japan#!ctype=l&strail=false&bcs=d&nselm=h&met_y=sp_pop_totl&scale_y=lin&ind_y=false&rdim=region&idim=country:JPN:USA&ifdim=region&hl=en_US&dl=en&ind=false

Population of Japan hardly changed for the last twenty years. It is likely that the population of USA would continue to grow. Hence it is not likely that RE in USA would behave similarly as Japan.

hanera says

Population of Japan hardly changed for the last twenty years. It is likely that the population of USA would continue to grow. Hence it is not likely that RE in USA would behave similarly as Japan.

Well, let the population increase as much as you want but those newly populated(local or foreign born) will not have enough money to buy the overpriced shacks - hence continued decline in high priced RE.

Population increase does not matter,if most of that increase is in the middle class. Middle class will be toast in America for quite some time.

bubblesitter says

hanera says

Population of Japan hardly changed for the last twenty years. It is likely that the population of USA would continue to grow. Hence it is not likely that RE in USA would behave similarly as Japan.

Well, let the population increase as much as you want but those newly populated(local or foreign born) will not have enough money to buy the overpriced shacks - hence continued decline in high priced RE.

Since you've already decided that would happen, I've nothing to add.

hanera says

Since you've already decided that would happen, I've nothing to add.

Hey, I don't decide, it is solid analysis. Think about it. There is a million $ shack sitting to be occupied and there are 10 middle class buyers thinking to occupy it and you throw in another 10 to make it total 20 buyers. All 20 or original 10 won't afford insanely price RE. I don't see all 20 to get big pay raises to get to that million $ shack any time soon,instead they will be hit by high cost of living,health care etc. - Middle class is really a toast in America.

Bubblesitter,

First thing first, I do agree with you that prices in SV is insanely high. Also agree with you that middle class would find it increasingly difficult to buy (may be even rent) a house in SF Bay Area (I assume we're talking about SFBA, I'm not familiar with other places). That doesn't mean that house prices would be declining. House prices are influenced by availability of jobs, housing loan conditions (DP, interest rate), quality of schools, crime rates and existing established neighborhood conditions.

RE: White guys & Asian women
I don't know why it is so prevalent here, to be honest. When I was younger, I SWORE that I'd never date an Asian woman because a) every white guy in the Bay Area does, and b) I figured they were all boring little subservient types (HAHA, yeah right) that cared about nothing other than fashion. I ragged on one of my buddies pretty bad when he was dating a Chinese girl back in like 2002.

Well, as karma would have it, I met my fiancee (HK/Chinese) in 2006 while I was an intern at Cisco Systems. It was a total coincidence as she was the other intern's friend from their days at UC Davis (she was visiting Cisco as a vendor and randomly went to lunch with my coworker, I tagged along...the rest is history). As far as I can tell, part of the reason for white guys + asian girls in the Silicon Valley is just the nature of high tech. There just aren't any white chicks in engineering! Well, even if there are, attractive ones are even fewer. From my experience, most of the ladies are Asian (Chinese) in technical fields around here. If you are going to meet a girl at work, and you are an engineer, then your options get sort of narrow.

I don't have any preference between white chicks & Asians. It just worked out that way...her & I clicked & the rest is history. She moved here in 1997 from HK (for obvious reasons) and went to HS & college in Davis. She got her citizenship a few years ago. I do have to say that she is a LOT more reasonable than a lot of white females that I knew & dated in college. Lots (not all) of American white chicks have this sort of "feminist entitlement" mentality where they think that they are supposed to own the man in the relationship, and that "maternal instincts" will always trump anything else (like common sense about borrowing $730k on 3.5% down "for the baby"). I think that that mentality leads to a lot of divorces, and it's been documented that women initiate the divorce 70% of the time, probably because they feel like they are not getting their way. People in general seem to have difficulty compromising & being reasonable, but I really do feel like women have become MORE unreasonable in the last 30 years, largely because society tells them that it is OK ("you are asserting your rights as a woman"). What ever happened to the 50/50 relationship?!

Anyway, I knew my lady was a keeper because we can both call each other on each other's BS, and we can both say, "I'm sorry I was wrong." I dated a lot of girls, and very few were capable of that (and neither was I when I was younger). Just as a funny aside, Planet Granite in Sunnyvale after 6PM is basically nothing but white guy / asian girl couples climbing. It must be the fact that white people are obsessed with the outdoors & related activities, and that Asian women are super competitive that seems to make that sport so attractive to them lol.

BTW, I can't wait for the PPP (pious peninsula progressives) to read my last post. The PC-police will have a field day with that one lol.

hanera says

House prices are influenced by availability of jobs, housing loan conditions (DP, interest rate), quality of schools, crime rates and existing established neighborhood conditions.

I am glad that you finally excluded increase in population as the factor. Now you can remove all of the others one by one. :)

bmwman91 says

I don't know why it is so prevalent here, to be honest. When I was younger, I SWORE that I'd never date an Asian woman because a) every white guy in the Bay Area does, and b) I figured they were all boring little subservient types (HAHA, yeah right) that cared about nothing other than fashion.

bmwman91 says

Lots (not all) of American white chicks have this sort of "feminist entitlement" mentality where they think that they are supposed to own the man in the relationship, and that "maternal instincts" will always trump

Bimmer, thank you for sharing. As you wrote, not all American women are like that. My partner is not like that. It's one of many reasons I refer to my partner as my partner, instead of using a different word. But, my American born American partner is an American born Asian. And that, besides that they are athletes, is why my kids are some of the best looking in California, and in the USA too.

bubblesitter says

hanera says

House prices are influenced by availability of jobs, housing loan conditions (DP, interest rate), quality of schools, crime rates and existing established neighborhood conditions.

I am glad that you finally excluded increase in population as the factor. Now you can remove all of the others one by one. :)

Frankly, I gave up talking to some of you guys. Twisted logic. Population is definitely one of the factor that affect housing prices.

hanera says

bubblesitter says

hanera says

House prices are influenced by availability of jobs, housing loan conditions (DP, interest rate), quality of schools, crime rates and existing established neighborhood conditions.

I am glad that you finally excluded increase in population as the factor. Now you can remove all of the others one by one. :)

Frankly, I gave up talking to some of you guys. Twisted logic. Population is definitely one of the factor that affect housing prices.

Well,now population comes back into picture? It is hard to sustain a discussion if you are flip flopping.

B.A.C.A.H. says

Bimmer, thank you for sharing. As you wrote, not all American women are like that. My partner is not like that. It's one of many reasons I refer to my partner as my partner, instead of using a different word. But, my American born American partner is an American born Asian. And that, besides that they are athletes, is why my kids are some of the best looking in California, and in the USA too.

Being able to say that you have a partner is a key thing. Glad it is working well for you. I think that the "partnership" aspect is lost in a lot of relationships. I ragged a bit on American women above but thinking a little more, I know about as many guys that are as selfish, just in different ways. Lots of people have a hard time accepting compromise.

And yeah, although I still don't know 100% how I feel about kids, IF we had them, they'd be good looking. Mixed ones almost always are. God help me if I have a daughter...the first time any of her boyfriends meet me, I'll be sitting on the porch cleaning my M1 Garand.

Bubblesitter has a point. The previous combination of both rising population (e.g. baby boom) combined with rising wages made houses rise in price along with inflation.
The situation looks to me a bit different today here. When I saw the boomers around, most got as much education as they could, and tried to make enough money to have houses, families, etc.
The population may be growing here but the people are not even all graduating high school. They cannot possibly ever achieve the median house of $500K+ unless the value of the dollar becomes so low that the wages inflate up even for crummy work.
And, the govt. jobs that were available to the uneducated unqualified is not increasing it's slowing down with the busted budgets of towns and the state also.

E-man says

BMW,

Maybe it's a cultural difference. It is my personal opinion that people who don't have kids are missing out. To me, I'd rather have more kids than more money. I'd give up my life for my kids. I can leave my wife, but I can't leave my kids. Any other questions? :)

Different strokes for different folks, I guess. I still have 3-5 years to figure out what I want with respect to kids. There are obvious reasons to and not to have them in my mind. I can see there being a pay-off later in life for sure. Dying alone seems like sort of a shitty fate lol. My god though, I don't know if I could handle the stress!

I am not sure that there is any cultural aspect to it. Her parents and mine nag us about it with about the same frequency. It seems like all cultures generally view child rearing as a top aspiration in life, since it is sort of necessary for a civilization to survive.

dunnross says

And, I suppose, Japan was also anomalous.

HK had a massive drop in 1997-1999 and then a steady Japan-like drop a few years after that. Japan's decline -- disregard the big mountain-like line, which is industrial land, because we're talking about housing here, and just look at the residential land line -- has actually been softer than HK's even in 1999-2003.

I don't see Japan ever rebounding like HK has. There are just too many old, hidebound, ultra-conservative seniors who want to suck the outnumbered younger generations dry and let the nation slip slowly into second-world status. If RE goes up significantly in Japan in the next 20 years, it'll be an illusion created by the inflation that the government is so desperate to ignite.

hanera says

Helloeeze says

... why do white guys marry Asian women so often?

And yet hardly any white gals marry Asian men?

Yes, because it's too small.