patrick.net

P F Changs? Living large.

RentingForHalfTheCost says

The owners in the BA are waiting to actually have equity

Not all homeowners bought during 2006-2007. Those who had bought their houses earlier than 2006 or after 2007 have equity. Current house prices are at 2006 level.

hanera says

RentingForHalfTheCost says

The owners in the BA are waiting to actually have equity

Not all homeowners bought during 2006-2007. Those who had bought their houses earlier than 2006 or after 2007 have equity. Current house prices are at 2006 level.

Last stat I read has over 25% of people with mortgage underwater. It doesn't matter if they bought in 2006-2007, many people drank the kool-aid that was free and took equity out of their homes during the bonanza times. Look around at the people who have 50-60k jobs and have a brand new SUV, new boat, house remodel, 100k in landscaping, etc. That all came from the salary? I think not. They are now toy rich but house poor. Welcome to the BA special people.

RentingForHalfTheCost says

Last stat I read has over 25% of people with mortgage underwater.

We don't know how many are with mortgage. % can be misleading.

RentingForHalfTheCost says

Last stat I read has over 25% of people with mortgage underwater.

This is true but the numbers vary by county. In your neck of the woods - more affluent areas - I've heard the number is much lower. Also, in the affluent areas, there are people technically "underwater" but their incomes are high enough to wait it out for 5 or 10 years.

We have friends who have a combined income in the mid-six figures and are underwater about 200k on there home. It sucks but they will be able to deal with it.

hanera says

Those who had bought their houses earlier than 2006 or after 2007 have equity.

2006-2007 above should be changed to 2002-2003

Folks should try to get out of the Bay Area. It really isn't All That. It is a nice place to visit. Nice scenery in general. OK weather depending on where you live. But like everywhere else, there are also crappy areas.

I lived in SF for several years. Liked being able to walk to dining and bars. Hated the traffic and pollution and home prices. Lived in El Cerrito for a few years. What a crap hole. Folks were talking about how nice Emeryville is on this blog. What a crap hole. Which is my point - living there for too long desenstitizes you to the low points of the Bay Area. There are much nicer places to live, that are more affordable and that have even more natural beauty.

I also lived in San Diego. Came for the weather and beaches, and stayed for several years. But it is better experienced as a tourist, and now is bascially South L.A.

LOL

C'mon Blurtman. San Diego is basically South LA? That's a wee bit inaccurate don't you think?

I don't think anyone is going to mistake North San Diego for Compton, or Inglewood.

Blurtman says

There are much nicer places to live, that are more affordable and that have even more natural beauty.

Where do you live. Egypt, near the Nile?

Goran_K
I do not mean to say that San Diego is like South LA, but that except for the intervening Camp Pendleton, it would be LA, but the southern end of it.

And as a former Encinitas resident (right off Moonlight Beach), yes, the North County is likely the only sane place to live in San Diego. But even moreso, there is no deisrable life east of 5, just a never ending shit hole of instant, souless communities, endless traffic, and pollution.

Believe it or not, there was a time when there wasn't much east of 5, but that all began to change drammatically in the '80's. So, yes, there are decent coastal community pockets that ironically cannot be built up much more, just torn down, and replaced with newer abodes, but you are still trapped in high density sprawl. Plus, live there long enough and you will have leather skin, and hopefully not anything worse.

The climate is undeniably the best in the USA. But San Diego has been played out for quite a while. Get out of the area and explore. There are saner places to be.

rowemoore,
If you do find a nice place to live, do not tell anyone, else it may become Californicated.

Blurtman says

Folks should try to get out of the Bay Area. It really isn't All That. It is a nice place to visit. Nice scenery in general. OK weather depending on where you live. But like everywhere else, there are also crappy areas.

I lived in SF for several years. Liked being able to walk to dining and bars. Hated the traffic and pollution and home prices. Lived in El Cerrito for a few years. What a crap hole. Folks were talking about how nice Emeryville is on this blog. What a crap hole. Which is my point - living there for too long desenstitizes you to the low points of the Bay Area. There are much nicer places to live, that are more affordable and that have even more natural beauty.

I also lived in San Diego. Came for the weather and beaches, and stayed for several years. But it is better experienced as a tourist, and now is bascially South L.A.

I can't comment on the LA-SD part, but I generally agree with you about the Bay Area. I grew up here & still live here. There are a lot of nice things about the area in terms of natural beauty. LIVING here though, is sort of overrated based on the cost of living and traffic. I have spent plenty of summers & winters in the northeast, northwest, southeast Asia and mid-west. Honestly, it just isn't as TERRIBLE as the Bay Area ninnies make it out to be. In fact, I would say that the spring & fall in a lot of those places is nicer & more beautiful than it is here. People here are spoiled as fuck sometimes. I actually hear people COMPLAIN about the weather here sometimes...WTF, have you ever been ANYWHERE else? If I didn't have 80% of my family here, I'd be leaving now.

Blurtman says

rowemoore,

If you do find a nice place to live, do not tell anyone, else it may become Californicated.

In other words, you don't want to admit what god forsaken place you can afford.

rowemoore says

LIVING here though, is sort of overrated based on the cost of living and traffic.

Cost of living is a big factor -- agreed. But if you can afford it, I can think of only a few other places in the US that are comparable.

The nice thing for BA homeowners that bought years ago is that selling now is providing for a nice retirement.

hanera says

RentingForHalfTheCost says

Last stat I read has over 25% of people with mortgage underwater.

We don't know how many are with mortgage. % can be misleading.

Could go either way then. Higher or lower. My guess is higher from the people I know. Everyone lived life to the fullest and refinanced while extracting money. In my area I wouldn't be surprised if the number was higher than 25%.

"In other words, you don't want to admit what god forsaken place you can afford."

You have found me out. I live in a shack next to the tracks in Lodi. Oh, the humiliation. But, OTOH, it's easy to hop a train to anywhere.

Blurtman says

The climate is undeniably the best in the USA. But San Diego has been played out for quite a while. Get out of the area and explore. There are saner places to be.

I'm not looking in San Diego, but I agree about SoCal and NorCal being sort of overrated. People move here with really drastic expectations (most of the time without the income to back it up), and then become disappointed.

Let's face it, housing is too expensive, traffic sucks, people are way too materialistic and shallow. But, I honestly can't see myself leaving California. I think I've fallen under the California spell too strongly.

Blurtman says

"In other words, you don't want to admit what god forsaken place you can afford."

You have found me out. I live in a shack next to the tracks in Lodi. Oh, the humiliation. But, OTOH, it's easy to hop a train to anywhere.

There is a little link "quote" you can use.

Lodi, huh? Could be worse.

1sfrenter says

That's the most ridiculous thing I've ever heard and I am assuming you don't live here and have spent very little time here.

Well, hearing about these million $ shacks in BA is just that ridiculous. :)

rootvg says

We didn't panic. Our deal was the right house at the right time in the right neighborhood and was the same monthly cost as rent. Renting, the tax man nailed us every year because of our incomes and not having children. Owning, we're gonna nail HIM.

If you're talking affordability in Mountain View or Milpitas, yeah...that's nasty.

You bought like a year ago, right? I am referring more to people watching the market now and thinking, "oh shit there is so little available and it goes fast....we need to BUY NOW before there are no houses left, EVER!!!!!" Transient market behavior folks, can't you see?

As for nailing the IRS...good luck. It is easier said than done. If your mortgage & expenses are close to your previous rent, the tax deduction will put you ahead. Sounds like you got a really good deal.

Mountain View...forget that. I love living here ONLY because it is a 15 minute walk to work. That extra 6-10 hours a week of free time from not commuting is almost impossible to assign a dollar value to. Rent is maybe $300 more than I would spend if I had to drive 1 hour each way. Buying however, is stupid expensive around MV that I would have no money left to use on my hobbies with all of my free time from not commuting. I am looking mostly around my parents' neighborhood in San Jose / Cambrian. Sadly, even that area is beyond what I am comfortable spending to get a house that doesn't need to be scraped. The fact is that most people in their late 20's & early 30's can't afford the same house that their parents bought in the area 30 years ago. It's fine though, renting really doesn't bug me since it is still so much cheaper than buying in most parts of the south bay.

:-) There was a similiar article a couple of months back in the Contra Costa times (spelling?) I thought it was ridiculus so tried to find the home listing online by price, couldn't find it. Then I actually called the reporter who didn't quite admit of any misrepresentation but said 'oh, that house is in Mountain View on Church Lane' and 'We are just trying to make a point'. As you can guess, I never found the house listing or sale record in Mountain View either.

Maybe you will have better luck should you try to find these homes in the article..

Consider the Bay Area to be the Best Buy of RE. See what you like, and don't like, and buy more for less elsewhere.

Curious to know why people think renting right now is the right way to go when the rental market is on the rise and rent for a 1 bedroom in some places is more than mortgage on a 2/2 condo in the same locations?

I see the logic that you're not tied in for 30 years but if you plan to stay around in the area, your rent will fluctuate only a couple hundred bucks and there is no tax write off. The only real advantage to renting is you're not really chained down and can move easier if needed.

The only renting I see that's still affordable is if you're renting a room. What am I missing here?

Rents are not on the rise for me. Houses are falling believe it or not. That makes it easy for me to keep renting. You asked.

Blurtman says

Folks should try to get out of the Bay Area.

Wish I could get out of here. But where to go?

I was seriously considering Portland for a couple years. But after many, many people told me about the chilly, wet weather (I always visited in summer) I realize I could not survive there - my mood can be quite dependent on the weather.

Spent two years in Austin. Got really boring. Not a very big place when you live there. Great outdoors scene but itsy bitsy old town surrounded by boring suburbs. And Texas is just, well, Texas.

Malkovich says

Blurtman says

Folks should try to get out of the Bay Area.

Wish I could get out of here. But where to go?

If you are ever up in Seattle, and turn on the telly, you might see that just about every other ad is for a CRO recruiting patients for anti-depressant medication studies. But as they say, the two worst things in life are not getting what you really, really want, and getting what you really, really want. Clearly you need to keep your place in SF, and get another place in Hawaii, the Northwest (summertime only), Boston (ditto), NYC (ditto), or other large, vibrant big city, if you need the culture.

Blurtman says

Clearly you need to keep your place in SF, and get another place in Hawaii, the Northwest (summertime only), Boston (ditto), NYC (ditto), or other large, vibrant big city, if you need the culture.

Haha.. wish I could.

Actually my GF's family is in Honolulu. I have proposed numerous times that I keep my rent-controlled apartment and profitable business going here, start another business with her bro in HNL, and live half the year in each locale.

Seeing as I won't be buying an overpriced, 100yo, falling-apart duplex or triplex here in the Bay Area anytime soon, this plan may be a good option.

In all seriousness though, I have thought long and hard about moving other places and, well, despite all of its flaws, I love San Francisco/Oakland (I couldn't care less about anything south of SF or east of Oakland).

1sfrenter says

It appears that the money is coming from China.

Could very well be. I looked at this http://www.redfin.com/CA/Oakland/3514-Randolph-Ave-94602/home/1808876 last week - technically in a good area but it was a few houses from a crappy area of MacArthur (homies milling around) and it needed a ton of work.

I had a quick look at the house and left. As I walked back to my motorcycle this 7-series BMW aggressively raced up and parked in front of the house. These two 20-something Asian dudes literally bounded out of the car with a clipboard or something. In their dress shirts and pants (must have left the jackets in the car) they started jumping around the house like excited grasshoppers. Helmet in hand, I stood there dumbfounded.

Money from China indeed.

My friend in S.I. (NYC) just sold his very old house to Chinese. House was worthless but sits on nice small uphill lot overlooking Manhattan skyline. He was dreaming on the best possible bid of $550K. He got cool $600K all cash, no questions ask.
We and Europe made some Chinese very reach and now money are coming back to us.

supersunken says

Curious to know why people think renting right now is the right way to go when the rental market is on the rise and rent for a 1 bedroom in some places is more than mortgage on a 2/2 condo in the same locations?

My rent is less than a comparable condo. AND I am not buying a depreciating asset. So, I rent.

Let's say you pay $1500 a month for renting an apartment, each year the rent can go up and up and up. 20 years from now, you may be paying $3000 a month (just a guess) for that same exact apartment. But if you buy that apartment, your payment would be $1500 a month - your payment will still be $1500 20 years from now. At the end of 20 years, you can rent out your house with that $1500 mortgage payment, but charge $3000 to rent it out! That is a huge benefit to owning your own property.

hanera says

Let's say you pay $1500 a month for renting an apartment, each year the rent can go up and up and up

Never happened to me and I have been renting for 15 years in the bay area. One time the landlord put the rent up and I said "nice knowing you" and then rented a better place for cheaper. YMMV.

How about the scenario of renting for 1500/mth while socking away 1500/mth in real investments that pay dividends. After 20 years you buy a house in cash and have money left over to live. No where in this mess did you owe your salary to a bank. Debt is for the weak. ;)

supersunken says

Where do people even come up with the money?

Shanghai. Taipei. Hong Kong. SIngapore. Mumbai. Bangalore.

Can someone name 1 property address that they suspect to have been purchased using money from abroad? I would like to debunk that theory.

bighorse says

Can someone name 1 property address that they suspect to have been purchased using money from China? I would like to debunk that theory.

14 CottageForYuan Rd, San Jose, CA

RentingForHalfTheCost says

bighorse says

Can someone name 1 property address that they suspect to have been purchased using money from China? I would like to debunk that theory.

14 CottageForYuan Rd, San Jose, CA

That address does not seem to exist. Please check it again.

bighorse says

RentingForHalfTheCost says

bighorse says

Can someone name 1 property address that they suspect to have been purchased using money from China? I would like to debunk that theory.

14 CottageForYuan Rd, San Jose, CA

That address does not seem to exist. Please check it again.

Sorry, I wrote it down wrong. Here is the correct one

121 KungPao Way, Cupertino, CA

E-man says

RentingForHalfTheCost says

Debt is for the weak. ;)

Tell that to the greatest investor of all times, Mr. Warren Buffett. It's more like no debt is for the fearful while debt is simply a double edge sword. ;)

Learn from your victory. Prosper from your failure.

Swords are for the weak. I'd rather use my bare hands.

For me, the high income job keeps me trapped here for now. However, if I could find a comparable job paying similar income and allow me to work remote from home with some travel, then I would move in a heartbeat to south Florida and pay CASH for a nice place with money left over for retirement and a boat.

E-man says

I have even a better assumption. Let's say your PITI and HOA are $950 to $1,150/month on a condo, and you rent it for $1,500 to $1,700/month. How many would you own?
Or your PITI is $2,000 on a duplex, and you can rent it out for $3,000 - $3,200. How many would you buy?
Those deals existed here in San Jose in 2009, but so hard to find in 2012. :)

On how much down payment %???