patrick.net

With state budgetary woes, my crystal ball says there may be more parcel taxes coming in Fortress areas.

B.A.C.A.H. says

There's a whole lotta regular folks from those places for whom status is not The Religion. But they're not the ones immigrating to Cupertino. So 'Tino has become a "self-selected" population of a certain sub-Culture.

Agreed... may not have ventured to other parts of the BA area... stuck in the enclave of Cupertino/Palo Alto till end of days.

Goran_K says

So I asked one of the guys one night, his name is Feng, "Feng, why did you end up getting a Porsche? Why not a BMW or a Lexus?"
His reply, "BMW and Lexus is so common. You know how much Porsche costs in Singapore? My same car cost double the amount in Singapore because of import duty. It's cheap here man, it's a steal."

LOL! maybe its for the mother in law... you just wait until he has to get a break job on the 7xxi... its not cheap.

Did you check the API? It is about 90% Asian. Flies around shit. Asian around expensive real estate. End of story. Do you want to live comfortably? Check the API, and make sure the percentage of Asian is not 90%.

B.A.C.A.H. says

bmwman91 says

Yup. It is a different culture, and a different mentality. Status is huge,

There's a whole lotta regular folks from those places for whom status is not The Religion. But they're not the ones immigrating to Cupertino. So 'Tino has become a "self-selected" population of a certain sub-Culture.

Of course. Chinese folks are like anyone else...hard working and trying to get by at a reasonable level. We have status whores here in the US, and they have theirs. Their population is so much larger than ours that they have a seemingly unending supply of status-douches that can afford to come here & compete with our home-grown-status-douches!

Goran_K says

RentingForHalfTheCost says

Goran_K says

It doesn't make sense to you and I, but it makes perfect sense to them.

Another bad attempt at explaining why you should pay 2x for something. This same logic was applied by others 5 years ago and look where it got us.

Okay, why don't you explain why places like Cupertino and San Marino have actually risen in prices since 2006 when every other market around he country has experienced a 25-50% decrease in price?

Not enough sales. The majority of people have enough savings to weather the storm better. That doesn't mean that there isn't a storm though. Eventually, the people that lost their jobs or took a pay cut, or have to move for a job, will need to sell. I know a few families in Cupertino that fit that bill and are hunkering down. One has a husband out of work buring through his 401K, and a wife that has changed job too many times to count. Things are not all good for everyone. They are not saving, but eating into saving trying to keep the house they purchased in 2006 making sense.

Not enough sales?

What? The standing inventory in Cupertino is less than 2 months. What gets to market sells, and it sells fast.

This thread makes it sound like Cupertino is immune to what is happening nationally. It is NOT. Just because it is holding up better in the last 2 years is a small window of time. Trying to explain it by using the Asian, or high tech workers excuse is just grasping in my view. People are not able to just throw money way. No one is saying they are expecting houses to appreciate, even in Cupertino.

Remember, what used to be a 1.14million medium for SFH in Cupertino is now down to 1.0million. I explain that drop with the same reasoning as the rest of the nation. Too much price for not enough value, good schools included. Sure, it is not the 33%, but crap it is still 140K drop! Considering the 20% down formula that is a nasty investment kick in the ass. It is not all happy learning kids and smiling parents down in Cupertino. Don't get fooled.

Here is what used to be

http://www.1siliconvalley.com/cupertino-housing-market-update-april-2007/

Here is where we are now

http://www.zillow.com/local-info/CA-Cupertino-home-value/r_4281/#metric=mt%3D19%26dt%3D2%26tp%3D5%26rt%3D8%26r%3D4281%26el%3D0

So they were $1.1m in 2006, and $1.1m in 2011.

RentingForHalfTheCost says

Trying to explain it by using the Asian, or high tech workers excuse is just grasping in my view. People are not able to just throw money way. No one is saying they are expecting houses to appreciate, even in Cupertino.

Back in 1990 Cupertino had 20% asian.. and during the 90s Asian population increased.. prices still declined. The inflow was due to HK being handed over mainland, so many skipped town.

So history has shown any increases in Asian population didnt translate to higher prices. One can also say the same regarding the Vietnamese who done a pretty good job fostering small business growth in the other side of Santa Clara County.

If your a migrant Bostonian or from New Hampshire... your pretty much blind to all this.

Draw the graph back to 1985.. and see the biggest housing bubble of all time.. never in our local history can you point to a period of 10 years where prices went up 200-300%.

Neither inflow of migrants nor the tech industry can sustain this.

Goran_K says

So they were $1.1m in 2006, and $1.1m in 2011.

Yup, so some people paid 2x rent for 5 years and have nothing to show for it. Add the inflation factor and that 5 years got pretty expensive. In 2006 you know there were realtors going crazy telling people they'd be fools not to buy. ;)

thomas.wong1986 says

RentingForHalfTheCost says

Trying to explain it by using the Asian, or high tech workers excuse is just grasping in my view. People are not able to just throw money way. No one is saying they are expecting houses to appreciate, even in Cupertino.

Back in 1990 Cupertino had 20% asian.. and during the 90s Asian population increased.. prices still declined. The inflow was due to HK being handed over mainland, so many skipped town.

So history has shown any increases in Asian population didnt translate to higher prices. One can also say the same regarding the Vietnamese who done a pretty good job fostering small business growth in the other side of Santa Clara County.

If your a migrant Bostonian or from New Hampshire... your pretty much blind to all this.

I hate to say this, though I don't believe the prices were driven up soley by Asians, I do think Chinese from mainland are much more readily to pay premium for educations and houses b'cos few of my Chinese friends here, who do not own a house, and most of them own a house in the premium neighborhood .... think they are able to cut down other expenses more efficiently, like hardly any shopping, no or few vacations, like cutting off international travel (including visiting their home country once every few years ...), not much eating out (or the ability to count on google food to feed the whole family instead of buying your own food) ... while the rest (including me) are too spoilt to have that life style.

E-man says

Nice looking chart for Cupertino.

500K to 1.1M... up over 100% happens every 10 years.

Seems stock option and lending impacts prices..

Wong,

Then explain 90% Asian kids in Cupertino schools. You gotta back it up with the facts.

Essentially. coming from Chinese, I will practically dismiss your comment in this case.

Nobody says

Wong,
Then explain 90% Asian kids in Cupertino schools. You gotta back it up with the facts.
Essentially. coming from Chinese, I will practically dismiss your comment in this case.

LOL! so easy to fall for my name.. Actually, im white and not asian.. German ancestry.

Regarding your question.. a coworker of mine.. he is Jap-American.. parents been here for decades. His wife also. Both grads from Cupertino back in the day. Two kids now go to Cupertino High. Like them, many have been around here for a long time. There many Asian in my HS back in the day as well. Some Chinese, some Japanese, Korean, Viet, etc etc.

As for facts.. look to the US Census data back in 1990. 20% were Asian, today 25%. Are you factoring the white baby boomers who live in Cupertino, and considering their children moved off to live elsewhere.

Why do they swarm to Cupertino and overpay.. beats me. But it wont last long. They certainly better not ask for a bail out as prices tank.

SparrowBell says

I hate to say this, though I don't believe the prices were driven up soley by Asians, I do think Chinese from mainland are much more readily to pay premium for educations and houses b'cos few of my Chinese friends here, who do not own a house, and most of them own a house in the premium neighborhood ....

If you don't think the Chinese can crash the housing market, take a look at what happened in Hong Kong back in the late 90's. Chinese surely like to gamble with their real-estate, so, prices in places like Cupertino will crash just as hard as they escalated.

thomas.wong1986 says

They certainly better not ask for a bail out as prices tank.

You kidding me? That is exactly what they will ask for when it tanks. They will call attention to this site and the people that were saying "Things are different in Cupertino". They will cry saying they thought patrick.net was mostly honest people trying to help each other. Their realtard, who appeared nice, will become their enemy as they remember the rush job that was done on them. "You better buy this one quick because more Asians families are on the next flight, and Apple stock just went up another 100B in value!". They will say they though that Cupertino housing never goes down. It has great School scores and that justifies everything!

People will not admit what buying a property in the BA really means. It means you are gambling for house price appreciation. If you don't get it, then you will cry like everyone does.

Renting for Half Cost,

Your Post is Hilarious! For those who that happens to, another planeload is already disembarking on the tarmac. For Cupertino and other Gaokao Culture places in The Fortress, the Sky is The Limit.

It is different in The Fortress.

I live in a nice area of north Cupertino. It is overwhelmingly Chinese. I rarely see any white people in my neighborhood. Some of the Chinese are citizens, but even most of those were born and raised in China or Taiwan.

I grew up in West San Jose and went to Junior High and High School in Cupertino. This was in the seventies. Cupertino was pretty much a dump, Rancho Riconada was kind of a dangerous place, and the schools were shitty (police removing guns in lockers at Hyde Junior High) or OK but not great (maybe Monte Vista was OK).

The schools haven't gotten any better. The Chinese and a relatively small group of Indians raised the API scores because of their fairly extreme focus on school.

In my neighborhood there are many kids but you wouldn't know it. You almost never see them except for Halloween. They are inside doing homework, playing the piano or doing something else educational. Almost every house has a piano. Piano stores across the US and in Santa Clara County are doing very badly but they are doing very well in Cupertino.

The Chinese come to Cupertino for the same reason many other places are segregated. They know people in Cupertino so they move there. Standard snowball effect. Also, there are a lot of homes in Cupertino between 1 and 1.5 million. That's actually relatively inexpensive compared to Saratoga or other city's with high API scores (Los Altos, Palo Alto, etc.).

So to address the original question, I think there aren't a lot of movers here and therefore there isn't a lot of inventory. They come and they stay, usually for 20 years or more until there kids are out of high school. The prices aren't that high, relatively speaking.

Still, I don't think any city is immune. And the stats you have can easily distort reality, especially in a small community, depending on what houses sold in the recent past. If north Cupertino sells a few more than south Cupertino, the numbers get skewed.

Lastly, Chinese have a habit of becoming landlords. If they do move, they often rent instead of sell.

Biff

thomas.wong1986 says

Why do they swarm to Cupertino and overpay.. beats me. But it wont last long.

B.A.C.A.H. says

Renting for Half Cost,

Your Post is Hilarious! For those who that happens to, another planeload is already disembarking on the tarmac. For Cupertino and other Gaokao Culture places in The Fortress, the Sky is The Limit.

It is different in The Fortress.

whats with your obsession with immigrants and cupertino? You repeat the same damn thing in every post.

Get over it Bill.. Apple to Apple comparison...

Apple has been around since the mid- 70s. With all the other great stuff going on in Cupertino-Santa Clara County back then, prices didnt magicaly double-triple in a few short years.

That being said, clearly home buyers were much more smarter back than and knew how to buy and save, vs the idiots today.

Serpentor says

whats with your obsession with immigrants and cupertino? You repeat the same damn thing in every post.

Maybe its a joke... Just like the joke about selling the Brooklyn Bridge. Or was it just a joke...

http://en.wikipedia.org/wiki/George_C._Parker

George Parker (1870–1936) was one of the most audacious con men in American history. He made his living selling New York's public landmarks to unwary tourists. His favorite object for sale was the Brooklyn Bridge, which he sold twice a week for years. He convinced his marks that they could make a fortune by controlling access to the roadway. More than once police had to roust naive buyers from the bridge as they tried to erect toll barriers..

Goran_K says

If you're a business man from Hong Kong, and $2,000,000 buys you a 2,500 sqft house in Cupertino, or a 1,100 sqft apartment in HK, the choice starts to make sense.

What utter nonsense. If you are a business in HK with $2,000,000, sitting in Cupertino on dead equity, who is minding the business back in Honk Kong?

thomas.wong1986 says

Apple has been around since the mid- 70s.

The Apple of today is an order of magnitude larger in terms of operations than the 2000s, and that was several orders of magnitude larger than the 1970s.

With all the other great stuff going on in Cupertino-Santa Clara County back then, prices didnt magicaly double-triple in a few short years.

For one, home prices did shoot up like crazy as the baby boom hit the market. My family was in El Cerrito at the time and I saw it first-hand as a kid.

But the post-Apollo & post-Vietnam spindown did put the Valley into something of a recession, from what I've come to undertand about the era.

The south bay had much more room to grow back then, both infill and overflow down the 85 and towards Milpitas.

Also, home prices haven't doubled or tripled here "in a few short years".

Per the chart above, prices have doubled from $550,000 in 1999 to $1.1M today, but the goddamn interest rate has in fact been halved since 1999.

Frankly, there are entire square miles of much nicer places to live in Fresno compared to Cupertino, eg:

http://binged.it/zh4cma

so I'm not saying Cupertino is the ultimate in housing, but it is what it is -- the home of a $460B market cap company (10 years ago it was $4.6B and kinda circling the bowl after the iMac craze faded and OS X was still being fixed up), plus a suburb of the Los Altos Saratoga professional enclave axis.

I thought prices were unsupportable in 2000-2001 and I was kinda right but I hadn't banked on Greenspan letting mortgages run free 2002-2004 nor did I see the rise of GOOG and Facebook 2004-now replace the former wealth-dumping events of the dotcom era (1995-2000).

The silicon valley is turning into a club for the cashed-out. Demand is willing but the supply is weak, and that's not even getting into the alleged Chinese influx, of which I know nothing about.

Most people I work with are obsessed with API scores. They dont want to venture near San Jose, Santa Clara, Milpitas where they feel (I dont know whether correctly or not) there are too many kids without attentive parents and drugs and bad behavior.

They also dont want to venture into Saratoga because they feel it has primarily rich and spoilt kids and bad behavior.

Dont know how much of these stereotypes are actually true but I have heard this type of reasoning from multiple people

Cupertino is seen as a place where hard working "middle class" $200K type families live which are neither blue collar nor trust fund babies...

dunnross says

Goran_K says

If you're a business man from Hong Kong, and $2,000,000 buys you a 2,500 sqft house in Cupertino, or a 1,100 sqft apartment in HK, the choice starts to make sense.

What utter nonsense. If you are a business in HK with $2,000,000, sitting in Cupertino on dead equity, who is minding the business back in Honk Kong?

Nonsense for the reason that if you are truely a business man you understand value, and is partly the reason why you have 2,000,000. It is the people who have it and don't understand its meaning that are throwing it away. Remember, as you get more, you want more even more. When you have 200k you think your attitude changes if you grow it to 2million. However, in reality you are more focused to grow the 2 to 4million. Simple fact of life. Only the people who were thrown into 2million by pure luck invest in bad value areas. They have a short half life though and don't make up the majority.

So, after all of this discussion.....

Does anyone in here actually want to live in Cupertino? Is it a hot topic because people want to live there & are annoyed at the prices, or are we just having fun examining a seemingly overvalued area that none of us would ever really want to live in. I'm in the latter group.

dunnross says

Goran_K says

If you're a business man from Hong Kong, and $2,000,000 buys you a 2,500 sqft house in Cupertino, or a 1,100 sqft apartment in HK, the choice starts to make sense.

What utter nonsense. If you are a business in HK with $2,000,000, sitting in Cupertino on dead equity, who is minding the business back in Honk Kong?

Yeah, like rich people around the globe can only think of one place to invest their money - buy a home in Cupertino and happily live ever after. LOL.

Wong,

Who cares about the macro. It is only 5% increase, but that 5% is concentrated in a small area driving up the price of housing. You have not explained why 90% of the student is Asian per API in Cupertino school.

Compared to Hoing Kong, the price of housing in Cupertino is still lower.

Every time I see the over priced transaction, it is usually Asian buyers with strong accent.

bmwman91 says

So, after all of this discussion.....

Does anyone in here actually want to live in Cupertino? Is it a hot topic because people want to live there & are annoyed at the prices, or are we just having fun examining a seemingly overvalued area that none of us would ever really want to live in. I'm in the latter group.

The latter. I worked and "played" there for years. The place is basically shit with zero personality. It's a *really* expensive strip mall.

CrazyMan says

bmwman91 says

So, after all of this discussion.....

Does anyone in here actually want to live in Cupertino? Is it a hot topic because people want to live there & are annoyed at the prices, or are we just having fun examining a seemingly overvalued area that none of us would ever really want to live in. I'm in the latter group.

The latter. I worked and "played" there for years. The place is basically shit with zero personality. It's a *really* expensive strip mall.

Later group also. If someone gave me a house for free there, I would rent it and still live elsewhere regardless of the cost. To me it is just the space between the two sets of montains. Necessary but pretty useless unless you are a farmer, and them days are gone around here. ;)

dunnross says

Goran_K says

If you're a business man from Hong Kong, and $2,000,000 buys you a 2,500 sqft house in Cupertino, or a 1,100 sqft apartment in HK, the choice starts to make sense.

What utter nonsense. If you are a business in HK with $2,000,000, sitting in Cupertino on dead equity, who is minding the business back in Honk Kong?

Dunross it's only nonsense to you because you don't understand the culture very well and the motivations behind their decision. But I like you so I'll explain.

San Marino and Cupertino have lots of wealthy chinese business types who buy homes here in the states not for themselves, but for their CHILDREN. Many of them go to school here in the states and college. In HK and China they consider American universities a luxury, almost like a feather in the cap.

Look at the API scores for schools in Cupertino and San Marino. Look at the rise of the chinese demographic. Look at the rise in prices.

Think about it for a second and put it together in your own mind.

Goran_K says

Dunross it's only nonsense to you because you don't understand the culture very well and the motivations behind their decision. But I like you so I'll explain.

San Marino and Cupertino have lots of wealthy chinese business types who buy homes here in the states not for themselves, but for their CHILDREN. Many of them go to school here in the states and college. In HK and China they consider American universities a luxury, almost like a feather in the cap.

Look at the API scores for schools in Cupertino and San Marino. Look at the rise of the chinese demographic. Look at the rise in prices.

Think about it for a second and put it together in your own mind.

I think its really YOU that don't understand MY culture. Your arguments have been rehashed 1000x here and it just doesn't hold water.

Do you think Cupertino is the center of the fucking universe? Do you really think millionaire commie tycoons really want to live near high tech? There are plenty of schools with a ton of immigrants in other areas of the world.

Let me repeat what I wrote many times to educate your freaking newbs
The vast majority of the immigrants in Cupertino did NOT come from Millionaire families. The worked hard, worked in high tech and saved to get to where they are. The price increase of the fortress areas happened because of the housing bubble cause by loose lending standards. This includes Crapertino.

I'm sorry you brought an overpriced house there, you are not the first person to post on Patrick.net to rationalize your purchase. The reasons you gave have been repeated a million times here.

If I was you, I'd enjoy the house and try not to worry about where price will go.

And no, I have no desire to live in Crapertino. I'd rather live in Palo Alto so my kid can become a superstar basketball player. Because Palo Alto is even more magical then Cupertino. LOL

Serpent,

Every One is an individual, including you. Now that you've expressed your individuality, you're well on your way to assimilation. Maybe, you're already completely assimilated. Like my American born Chinese friends who also want nothing to do with that API ghetto, including a couple who grew up in that particular API ghetto and attended the schools there.

Regarding the rest who don't act so Individuality-ish, I did not say they are or came from Millionaire Families.

I said, Wealthy Families. Of course they are Wealthy. To get an engineering degree (or whatever) in Asia that's good enough to get an H-1 job or into grad school here, of course you have to be wealthy, well-connected. I don't think Blue Collar types are coming here by that route.

Once they are here, well, to pay cash in The Fortress, they have to be Wealthy. To have enough cash for a downpayment in The Fortress, they have to be Wealthy. To qualify to borrow in The Fortress, they have to be Wealthy. To afford the rent or the mortgage payment in The Fortress, they have to be Wealthy. To pay the Property Tax bill in The Fortress, they have to be wealthy.

LIke others here have observed, they are mostly immigrants bidding against each other either to buy or rent in the Gaokao Genuflection-to-the-API, and of course to be able to do so, of course they are wealthy.

You don't think they are so wealthy? Just ask the Rest of Us who live in most of the rest of Santa Clara County, who change the oil in their cars, clean their office buildings at night, cook the food in the restaurants they eat at, sell them the goods at the retail stores, etc.; of course they are wealthy.

They are Wealthy and they are Immigrants

Wealthy Immigrants. And they keep comin'.

"Does anyone in here actually want to live in Cupertino?"

If I was working for the mothership, sure. Can't beat being an easy (non-sweating) bike ride to work vs. dealing with 85/280.

But other than that, no way. I've begun to rethink my desire to live in Los Altos, too.

Access to a Chipotle & In N Out should not drive my major life choices, LOL. I can make my own burgers and maybe I should learn how to make "barbacoa" beef too.

Instead of paying a million-plus for a $35,000 house in Los Altos my pal decided to decamp to the hills above Santa Cruz for about $200,000 less, on a lot big enough that he can't throw a rock from his house to off his property.

Trader Joe's and Costco are an easy drive away still.

Back around 2002 I was looking at buying some land up in the San Lorenzo Valley and making a similar doomstead.

But most people have to commute into town every day, and 17 / 9 is a bitch of a commute so most families are stuck in the valley. And if you're stuck in the valley, Cupertino is in the sweet spot beween the shittiness of San Jose and the enclaves closer to Stanford.

White Flight from Cupertino : http://online.wsj.com/article_email/SB113236377590902105-lMyQjAxMDE1MzEyOTMxNjkzWj.html

bmwman91 says

So, after all of this discussion.....

Does anyone in here actually want to live in Cupertino? Is it a hot topic because people want to live there & are annoyed at the prices, or are we just having fun examining a seemingly overvalued area that none of us would ever really want to live in. I'm in the latter group.

Regarding Cupertino desirability -
Agreed, if you are looking to go to bars and restaurants every night, cupertino is not a good fit. And those who prefer long commutes (it came up in a different thread) wouldn't like it if they work in silicon valley.

for someone with a family, looking for a quiet place, low crime, with other families, short commute, good schools, it's a nice place. Cheaper than Los Altos / Saratoga / Los Gatos / Palo Alto but nicer than Milpitas / Campbell / most of San Jose.

Saying Cupertino is "horrid" is a little extreme, that's a description of some place with bullets whizzing around.

baka, I still haven'' gotten an answer on why you are so obsessed with the immigrants. You use that term " Gaokao" like it makes you an expert. Did you just learn it because you seem to use it on every post.

No, you don't have to be wealthy or connected to get an H1B. I know because my parents and most of their friends came out here that way. Of course you can't be dirt poor and you have to be pretty smart, but there was absolutely no family money involved.

has the demographics in Cupertino changed? are many of them well off immigrants? yes, but they got to where the are because of hard work, not magical commie dragon gold. Macro and micro economic forces still applies. There is no gold plated force field around Cupertino when the surrounding areas, wealthy or not, are being affected.

How many of them paid cash in the Fortress? lets see some numbers. I'm curious.

You DID not have to be wealthy to qualify for a mortgage in the Fortress. THATS the point. Back when the bubble was brewing, anyone with a half way decent income and credit score can qualify for a 5yr ARM + a second mortgage for a down payment. THAT IS WHY THERE IS A HOUSING BUBBLE.