patrick.net

myob says

The ones who don't plan for the future are more numerous, and so, have more political clout :)

Good point. I should cash in my 401k and buy a Canyonero. Responsibility is for suckers.

REpro says

The sad part is that proudly high salaries in S. Valley, actually do not buy you a luxury, but a very basic live standard where in over places uneducated people can enjoy. $500K house here is like $120K somewhere else. Living costs cheaper too. Silly Valley…

IBM, Texas Instruments, Motorola, ATT, Dell, EMC and many others dont seem to be in high priced areas, but they do have the same educated workforce. Frankly we (SV) employ the same workfoce in more lower costing places than in SV.

myob says

since renting something comparable is maybe only 20% cheaper per month.

Don't pay more per month to get a depreciating asset. Silly.

This is not happening only in Sunnyvale. We've been looking at houses in the Willow Glen area for the past 2 months and have experienced the same thing.
Seller's agents have told us (during open houses) that there have been multiple bids (up to 15K over asking price) even before the open house was posted.

We've been outbid twice (on $520K offers) by cash buyers!

What boggles my mind is that these houses are not worth 600K+! The schools aren't that great in that area either. Why would someone pay more than $525K for any of those houses?

I have made several offers in Contra Costa County in 2012.

I'll admit that I am being selective, but each one had multiple offers and going above asking price.

Part of the reason is that these have been REOs that are originally being priced too low by the bank to create frenzy, but the big reason is discussed in the link below (lack of supply):

http://realestate.patrick.net/?p=1211201

The Bay Area is down 35% in invetory compared to this same time last year, the number of homes sold is up 9%. Although this is creating multiple offer situations and homes aren't sitting on MLS as long as they did last year, the selling prices are remaining flat.

Let's take it a step further regarding Bay Area RE:

Inventory down 35% compared to 1yr ago.
Sales are up 9%
Prices are flat

With supply down and demand up, anything other than prices being up would be an indication that the real estate market in the Bay Area is still sinking (at least relative to a year ago)

BayArea says

With supply down and demand up, anything other than prices being up would be an indication that the real estate market in the Bay Area is still sinking (at least relative to a year ago)

Its more that as of now, homes can only be bought using "real" financials. In other words, buyers not only need good credit, but they also need numerous forms of proof of their financial well-being. You need cash. You need savings. You need good jobs. And so on. Prices are either flat or slightly sinking because what people can really afford is reflected in the prices and the prices from the boom were not reflecting reality. What people in the BA can 'really' afford is far less than what many might have assumed.

edvard2 says

In other words, buyers not only need good credit, but they also need numerous forms of proof of their financial well-being. You need cash. You need savings. You need good jobs.

Great! It's about time.