patrick.net

wthrfrk80 says

rootvg says

The big problem with folks in the Bay Area is that so much of what goes on here is based on feeling rather than thinking. The people who run this state do so by manipulating emotions to enrich themselves politically and financially. There are too many people here with money they never earned or earned too easily or who grew up in upper middle class circumstances which they take from granted. It's reflected in the business culture.

When you see something happen that by all normal measure doesn't make sense, it probably doesn't. If you don't know what to do, don't do anything at all. So many people react viscerally to things here but I don't, coming from a different part of the country with different values and cultural foundations and frankly, not as much money.

Ding ding ding! You've answered correctly!

Well, Wink...what have they won?

Realtors Are Liars says

No you don't. You talk out your ass about BS computer crap that nobody asked or cares about.

Realtors Are Liars.

For starters, why don't you settle down: wings level, nose down, flaps up.

I know, I know...it's the Bay Area. Let's just say I tried.

Realtors Are Liars says

No you don't. You talk out your ass about BS computer crap that nobody asked or cares about.

Realtors Are Liars.

So are insurance men, car salesmen and a lot of senior executives.

So are most lawyers and some doctors.

Pharmacists? Not so much.

Developers, unix sysadmins and DBAs? Never. There's no time for it.

Knowing all this at a very young age, my wife and I found something that suited us that we liked doing and can make a living at until retirement.

Btw I think the news of higher FHA fees (linked by Patrick and others) is pretty significant.

"Small" increases in premiums have a big relative impact when rates are so low to begin with.

It also sets a precedent that our political overlords actually are being forced to accept gradual reductions in subsidies. Maybe they find this easier to manage than an FHA bailout. Will it happen again next year and the year after that?

This has tilted my views on housing in the bearish direction.

rootvg says

Well, Wink...what have they won?

You've won free (one way) airfare to a place with sane housing costs!

Realtors Are Liars says

That's your funeral. Don't expect everyone else to make the same balance sheet destroying mistake.

Realtors Are Liars.

How is it my "funeral" when I would pay rent in the one scenario and have the money gone and in the other scenario have at least a reasonable hope of some savings or even (perish the thought) appreciation because I'm buying a fixer?

One of the many things you don't know is the house we're buying is for us the same as monthly rent. On top of all that, we're tired of getting yearly tax bills in the range of ten grand just because we don't own. On top of all THAT, the house we're currently in is older and not up to code which means combined with our utility bills we're already paying more than we would to live what we're buying.

If we were to move to another rental, our monthly would go to somewhere between three and three and a half grand. That's more than our house payment will be and more than rent has ever been for us. I don't want to live in Hayward, Fremont or any of the supposedly more affordable parts of the East Bay. I don't want to live next to someone I can't communicate with. I don't give a shit how many names you call me or whether or not you think I'm a (insert worn out progressivist emotionally charged epithet here). I don't fucking care.

Now, is that what you wanted to hear?

Is the CRASH over? My bets would all be on "yes." The bubble popped and prices tumbled in all but two Bay Area locales (SF & SJ/Silicon Valley). The latter two started their decline & then suddenly ceased due to exorbitant demand, a variety of manipulative measures by the government, banks and RE cartels and the fact that the higher paying jobs are all around these areas. Now, prices are continuing to slide down slowly, and rightfully so in most areas. All of the big exciting activity is over, assuming that there is not some nationwide economic meltdown (which there may well be).

Now, most people here seem to be focused on the two locales that hit a shoulder in their decline....because they are desirable! They are close to jobs, generally lower in crime, and have "better" schools by various measures. Combine that with something that I have been saying for quite some time: You don't need a sharp financial sense to make a lot of money. Just because someone is really smart at engineering or whatever, and makes a lot of money, doesn't mean that they have any clue as to what they are doing with it! Then add in various social pressures, the fact that home ownership is ground into every American's list of life goals from birth, 3.5% down loans up to $625k, and you end up with couples pulling $200k+ that can easily borrow enough to push prices beyond levels dictated by common sense. The market will bear what it can, and given the current system, it will bear really expensive houses. The drive to buy a house for way too many people with solid incomes really seems to be as simple as, "well I am going on 30 and we are going to have a kid soon...we need a house. Renting is throwing money away." Truly, there aren't all that many people that think about the financial aspect beyond, "how much is the monthly payment." There are more of those people than available inventory in the super desirable areas. You can argue that these areas' reasons for being desirable are bullshit, and those arguments may well have merit, but they don't change anything.

I used to get mad about this. It certainly can be frustrating when you think about it. Alas, there's no point in letting it irritate you. People have been dumb since forever. There have always been more dumb people than smart ones, at least since large human civilizations started popping up. You really can't fight it, and raging against it is futile. Will prices in these two areas come down significantly? Maybe, but only if there are some huge changes in the system. I am not holding my breath for that, and instead am just focusing on the myriad of positive things in my life that really aren't affected by rent vs. buy. Hell, renting gets me 1.5 miles from my office and I use my car to get to work less than once every other month. I could buy around here, but most of the stuff that is available in my set price range is smaller or less nice than my rental, and would cost more per month to buy.

Anyway, just remember, "you can't compete with stupid." There are plenty of smart people that make a lot of money here, but they are also money-stupid and grossly distort the market. As long as these jobs are here though, this will be the case, and rather than thinking about it as being a distorted market, you may as well save yourself some aggravation and just see it as THE market. It sucks for people that like things to make sense, but it just seems to be the nature of things.

wthrfrk80 says

rootvg says

Well, Wink...what have they won?

You've won free (one way) airfare to a place with sane housing costs!

My wife has a job in the UC system and she's been there ten years which means she's vested. We're stuck...and that's why we bought.

rootvg says

I don't want to live next to someone I can't communicate with

I don't understand. You mean because you feel uncomfortable hearing spoken languages other than the ones you speak?

FunTime says

rootvg says

I don't want to live next to someone I can't communicate with

I don't understand. You mean because you feel uncomfortable hearing spoken languages other than the ones you speak?

I don't feel at all.

The whole problem with California is that we've become all about feeling and very little about thinking. That's why Sacramento governs the way it does and why most of the rest of the country laughs at us.

There are 55 Electoral votes in this state. There are about 160 Electoral votes in the so called "values states" of the south and that doesn't count the swing states in the midwest which are red in normal times. That's a significant differential and damn well worth paying attention to if you're someone looking for a handout with which to perform social engineering just so you can feel good.

It's also why Republicans in the House are gonna cut off the flow of money to the California Congressional delegation next year. This happened before and it's gonna happen again. The mid nineties and most of the decade that followed were very lean years for the non profit social welfare economy in this state. Conservatives in the House simply shut off the tap and they're gonna do it again.

bmwman91 says

People have been dumb since forever. There have always been more dumb people than smart ones, at least since large human civilizations started popping up. You really can't fight it, and raging against it is futile.

Yes, but there is opportunity for leadership and education which shows people ways to better meet their needs. People who spend more money than they have are trying to get their needs met. I don't think they're really getting their needs met, though. They're getting their dream met and wondering why it is so unsatisfying. Part of the reason is that significant numbers of people in leadership positions in government and private are willing to sell people who don't understand the unrest caused by a life of debt to the benefit of the people with the money to sell.

rootvg says

I don't feel at all.

Okay, I'm even more confused. Are you saying you don't acknowledge your own humanity or that the desired state of thinking is one of unfeeling?

Are there not events in your life which lead to feelings of happiness, like time with your family?

This is a whole other topic.

The old couple down the street (the same ones who sold real estate, the same ones who went through the Depression, the same ones who taught me most of what I know) used to go on about this constantly.

Even my grandmother, who's still around at age 96 said it started after the guys came home from the war. No one wanted to wait for anything anymore. The work ethic was still there but the willingness to save and sacrifice wasn't. Maybe it was because it (and they) could all be gone in the blink of an eye and figured they should live for today. I know that's sort of what happened to the British. They "won" their part of the war with our help but it broke them financially and the level of depravity after the war was such that it forced them into a socialistic low growth economy they cannot now escape. We have more flexibility and more resources and we're a younger country without all the baggage. We'll be back. I'm sure of it.

FunTime says

rootvg says

I don't feel at all.

Okay, I'm even more confused. Are you saying you don't acknowledge your own humanity or that the desired state of thinking is one of unfeeling?

Are there not events in your life which lead to feelings of happiness, like time with your family?

I said all I'm going to say. I told you what I think.

rootvg says

The whole problem with California is that we've become all about feeling and very little about thinking. That's why Sacramento governs the way it does and why most of the rest of the country laughs at us.

I don't share your experience. I've met many, many Californians who seem quite thoughtful.

They may not be the Governor and if that's your point, I get it.

rootvg says

I said all I'm going to say. I told you what I think.

Okay.

rootvg says

It's also why Republicans in the House are gonna cut off the flow of money to the California Congressional delegation next year. This happened before and it's gonna happen again. The mid nineties and most of the decade that followed were very lean years for the non profit social welfare economy in this state. Conservatives in the House simply shut off the tap and they're gonna do it again.

California is America's equivalent of Greece.

wthrfrk80 says

rootvg says

It's also why Republicans in the House are gonna cut off the flow of money to the California Congressional delegation next year. This happened before and it's gonna happen again. The mid nineties and most of the decade that followed were very lean years for the non profit social welfare economy in this state. Conservatives in the House simply shut off the tap and they're gonna do it again.

California is America's equivalent of Greece.

There was an article in the Wall Street a number of years ago that said California was America's France. These days, that would be step up.

rootvg says

There was an article in the Wall Street a number of years ago that said California was America's France. These days, that would be step up.

Agree.

So if California is Greece, does that make Texas our equivalent of Germany?

Realtors Are Liars says

rootvg says

One of the many things you don't know

This isn't about me kiddo. It's all about your depreciating used house.

How do I get hurt if all the houses around it are selling in the sevens and eights (I bought mine out of an estate for six) AND they're all pending...

...and it's the same monthly cost as rent, the utilities will be cheaper and I'm gonna put solar panels on it so I can run the A/C down in the summertime and have it cost me almost nothing? I can't do that in a rental.

And, it's in Danville. Fremont, we ain't.

We got lucky. I'll admit it. But, the deal is what it is.

I guess only time will tell who is right. Like most investing.

wthrfrk80 says

rootvg says

There was an article in the Wall Street a number of years ago that said California was America's France. These days, that would be step up.

Agree.

So if California is Greece, does that make Texas our equivalent of Germany?

That's a good question.

We lived in Texas for a number of years and I can tell you they don't like Californians. They also just got four more Electoral votes from the collective losses of Ohio and Pennsylvania. Those seats won't all be Republican but I'll bet most of them will be. If they are Democratic seats they won't be filled with liberals. That's not how things work down there.

This is why I keep saying Boehner will simply call in the California Congressional delegation and lay down the law. We've already seen several bills come out of the House with stipulations that none of the money be used for high speed rail, which is the next big thing the libbies want to build here.

This could get interesting in the next several years.

I'm a mechanical engineer, and it seems like Texas is one of the few places with lots of good engineering jobs. They've got real industries that make real stuff.

California still has Silicon Valley, but how can companies (even high tech ones) afford to be there when the cost of living is so high? You need a six figure income just to have a middle-class existence there.

FunTime says

Yes, but there is opportunity for leadership and education which shows people ways to better meet their needs. People who spend more money than they have are trying to get their needs met. I don't think they're really getting their needs met, though. They're getting their dream met and wondering why it is so unsatisfying. Part of the reason is that significant numbers of people in leadership positions in government and private are willing to sell people who don't understand the unrest caused by a life of debt to the benefit of the people with the money to sell.

Sure, leadership COULD do a 180 and start trying to encourage fiscal responsibility and helping people to unshackle themselves from their own perceptions of happiness and life. I don't see it happening because the system, as it is set up now, is very lucrative for the those up top that have the power to make these changes. Believe me, it seems really sad to see so many people that are convinced that money and "stuff" will bring them happiness, if they could only get that "one more thing" they are after. The thoughtless pursuit of material wealth is what our whole economy has become completely dependent on. If people stuck their thinking caps on and did a little rumination about it all, they would see the answer loud and clear: the problem isn't "not enough money." The problem is, "wanting too much shit that I don't need."

Now with that said, this certainly is not to say that money is totally unnecessary. Money does not buy happiness, but it can buy options. Having options in how you live your life can help lead to happiness, if the right ones are chosen. So, as far as I see it, money + smarts can lead to happiness in western society, but there is no guarantee of it, and you need to have some sort of vision about your own destiny.

rootvg says

We've already seen several bills come out of the House with stipulations that none of the money be used for high speed rail, which is the next big thing the libbies want to build here.

Maybe we can afford a High Speed Bus system:
www.youtube.com/watch?v=xzlqNp8R90A

sheltielover1 says

Stupid, stupid, stupid... I think I am done with you libs.. Too much stress for reading your idiot posts...

Comment deleted.

bmwman91 says

Sure, leadership COULD do a 180 and start trying to encourage fiscal responsibility and helping people to unshackle themselves from their own perceptions of happiness and life. I don't see it happening

I agree. I was thinking of leadership at our level. People are thinking about these subjects. The popularity of patrick.net is an indication. So the influence of regular people has its own power. People can vote.

I hope some of the politicians taking money from Goldman are secretly biting Goldman's hands at the same time. Big money companies like Goldman and Morgan Stanley don't care who gets elected so long as they establish a friendship with them as they're getting elected. That's what the campaign contributions say to me. If Morgan Stanley is happy giving money to both Obama and McCain, but a bit more to Obama, they're just hedging on the way government policy effects their profits.

rootvg says

It's also why Republicans in the House are gonna cut off the flow of money to the California Congressional delegation next year.

They'll be lucky to hold the House at this rate. No leadership, no direction and pissing off major constituencies left and right for personal, petty political gain. I've never seen the party so in shambles.

CL says

rootvg says

It's also why Republicans in the House are gonna cut off the flow of money to the California Congressional delegation next year.

They'll be lucky to hold the House at this rate. No leadership, no direction and pissing off major constituencies left and right for personal, petty political gain. I've never seen the party so in shambles.

If that were really true, Pelosi wouldn't be talking about retirement and Jerry Lewis/Barney Frank wouldn't have announced they're not running again.

It's NOT the United States of California! With regard to political culture, California is the exception, not the rule. I've lived all over and speak from experience.

wthrfrk80 says

I'm a mechanical engineer, and it seems like Texas is one of the few places with lots of good engineering jobs. They've got real industries that make real stuff.

California still has Silicon Valley, but how can companies (even high tech ones) afford to be there when the cost of living is so high? You need a six figure income just to have a middle-class existence there.

I lived in Texas and there were so many issues with the place that we had to leave. We were constantly sick from the allergies and I hear the same complaints about Austin, Houston, Tampa and Orlando. If you grew up in a place where it freezes solid, those markets are good for a few years to get experience but then you have to move somewhere cleaner.

Realtors Are Liars says

When rootvg says

How do I get hurt

You're already hurt. Prices are falling.

Realtors Are Liars.

You apparently don't retain what you read. I told you where it was, what it was, what we paid for it, the conditions under which we bought it and what the houses around it are selling for.

Why are you so bitter?

Realtors Are Liars says

rootvg says

One of the many things you don't know

This isn't about me kiddo. It's all about your depreciating used house.

Would your knee jerk response be the same if the house was in a place that doesn't boom and bust, like suburban Akron or Columbus or Cincinnati or State College PA?

I mean, what the hell's your problem? Act like an adult, why don't ya!

joshuatrio says

gregpfielding says

Deep down, we're all cavemen.

lol. nice one.

Reminds me of that scene in Mel Brooks' History of the World Part I with the caveman and the club...

tatupu70 says

By that logic, a one-income family should never buy a house?

In the Bay Area? Possibly not.

edvard2 says

Ok, well I suppose we can agree to disagree then. I am a fairly conservative and careful person with my money and 600k definitely bridges the acceptable limit for me even though I could technically pay for a house such as that. My opinion also comes from having experienced being laid off not once but twice and even though I've been fortunate and gotten good jobs including the one I have now, I also realize that fortunes can change quickly and thus putting ourselves into a situation where we have this huge debt hanging over our heads that is relentlessly due regardless is daunting and concerning.I am simply not really a fan of taking major risks, which an expensive house to me most certainly is.

That said, I am sure that what I think as being more reasonable- as in the 350k-450k range- is equally absurd in most of the country's eyes where 200k or less buys a decent house in a nice area.

I agree with you but if you're going to stick with that, you need to relocate. Close in areas that are within commuting distance of either SF or SJ will never be in that range. Yes, there's Brentwood, Antioch and Oakley. We looked out there and decided against it. They aren't safe.

bmwman91 says

Is the CRASH over? My bets would all be on "yes." The bubble popped and prices tumbled in all but two Bay Area locales (SF & SJ/Silicon Valley). The latter two started their decline & then suddenly ceased due to exorbitant demand, a variety of manipulative measures by the government, banks and RE cartels and the fact that the higher paying jobs are all around these areas. Now, prices are continuing to slide down slowly, and rightfully so in most areas. All of the big exciting activity is over, assuming that there is not some nationwide economic meltdown (which there may well be).

We were the first to see the boom in prices, along with the Boston region, well known for its share in the tech boom of the late 90s. So we will be the last to feel the ultimate pinch...

wthrfrk80 says

California still has Silicon Valley, but how can companies (even high tech ones) afford to be there when the cost of living is so high? You need a six figure income just to have a middle-class existence there.

Actually the headcount has shrunk in Silicon valley and most SV Company jobs are outside the region. It far more typical to see 1000-2000 jobs in SV for companies that have overall employee count well above 50K or 100K. They are not all here!

FunTime says

I don't share your experience. I've met many, many Californians who seem quite thoughtful.

Only 1 our of 3 can truly call themself a Californian (born here) ... many today came the east coast.

Here again, it depends.

We only bought because after it was all said and done, it would be cheaper than rent. We hadn't owned for eight years because the values both here and in LA where we lived previously were completely out of line with our income. We found a place we liked, we met the previous owner (kids from the trust all live in the neighborhood, house was built by their father), we worked a deal we could afford, the rate was something we'll never see again and we pulled the trigger. It's just that simple.

All the houses in the neighborhood are selling $100-150K higher than what we paid. The lawyer sold the house cheap to get money for upgrades to commercial properties that were still in the trust. No Baby Boomer emotions to deal with, no last minute screwball shades of gray cultural horseshit to navigate...right house, right time, right price, right realtor. Put the airplane over the numbers, pull the throttle and grease it on. Nice.

We're lucky and we know it.