patrick.net

SJ says

Is it possible to buy a nice home at an affordable price in a safe area in California?

No. So my take is why live there? They have slit their own throats over real estate.

CA IS OVER.

It's a social science and particulalry in the SFBA, it can be explained as follows:

* Distribution of API Scores. How many areas are considered truly outstanding school districts? 5% -10%. We are talking about 5-10% of the housing stock and significantly less if it is SFH.

* Family households in small cities (50K plus people) like Palo Alto, San Ramon and Cupertino are considered the most educated in the world, it is only natural that their education standards are higher. I have never met a PhD, science/engineer, business executive that considers anything less than 900 as acceptbale

* Housing price is competed on the margin not %. The spectrum of household income is wide. Lots of people works at low pay jobs (Same jobs everywhere else in the country), but there are also many high paying jobs. This makes median stats useless. Forget using median income as a metric of affordability as it includes college kids and retiree, use family household income at the 75%tile for a better gauge of API buyer inventory and their economics.

* The MID is lucrative in the bay area, especially areas with high API. It makes it unreachable to lower income households.

* Families with small kids are always potential home buyers for obvious reasons.

* The bay area is unique in culture and draw. If you are a chinese/Indian engineer, etc. everywhere else is a deal breaker. While you are saving up to live In Florida, most are unwilling.

* Once you fixed the living cost, SFBA is as cheap to live than anywhere else in the country. The typical SFBA home is not the huge to begin with so there is really no need to downsize. In other words, most will keep their homes to the end.

SFAce,

all the stuff that you wrote may be true (I think it is), but it is irrelevant. Those Tiger Kids of Tiger Parents would do just as Tiger Swell at many other schools in more affordable neighborhoods. I have personally known many who have. Including maybe even myself, and my kids, too. Might even learn a few things about the Real World.

Unless you wanna pay dearly for a status symbol, it's a friggin' waste of money, and for many who stretch to do it, a friggin waste of stress.

B.A.C.A.H. says

all the stuff that you wrote may be true (I think it is), but it is irrelevant. Those Tiger Kids of Tiger Parents would do just as Tiger Swell at many other schools in more affordable neighborhoods. I have personally known many who have.Might even learn a few things about the Real World.

Unless you wanna pay dearly for a status symbol, it's a friggin' waste of money, and for many who stretch to do it, a friggin waste of stress.

I have SFace on ignore, but I have an idea of what he probably said, and I agree with BACAH's post completely. API scores to a certain extent are overrated. A kid who goes to a 930+ API school doesn't have a higher chance of getting into UC Berkeley than a kid who goes to a 890+ API score.

Some people might say there is little difference here or there. That school scores are all close enough, that it's all irrelevant.

But it's a self fulfilling prophecy at the same time.

It's not what you know, it's who you know. If a school has a better score, it's going to attract parents who are richer. And if you're poorer, you'll have to pony up to get in there.

If you don't even have kids, you know that the people who are living around those schools are likely to be very goal orientated with lots of well of people who are willing to put education first. Those are the types of neighbours you want.

Now, there are always cases of "Well so-and-so went to the worst school in the country and is a millionaire now..." but when it comes to a numbers game, people are getting rich from their connections, and getting great connections requires living around those connections and getting to know them and going to school with them.

Kids personalities are defined by those they hang around with. Put your kid into a crappy school, there is a very good chance he'll start aligning life goals along with his peers. Put him in a rich school, and he'll start aligning his expectations with those kids. Every step up helps.

The difference between a fast food worker and someone making 50K a year is huge. Or getting your kids to hang out with kids who will likely enter professions making 100K, or perhaps start their own businesses and make 500K, or those who might just start off with a few million and expand from there.

Goran_K says

I have SFace on ignore,

It's your loss. If I were the POTUS or a CEO of a big corporation, SFace would be my right hand man. This guy is as well rounded as it comes. I'm sorry you don't have the ability to comprehend the information that SFace conveys.

Goran_K says

B.A.C.A.H. says

all the stuff that you wrote may be true (I think it is), but it is irrelevant. Those Tiger Kids of Tiger Parents would do just as Tiger Swell at many other schools in more affordable neighborhoods. I have personally known many who have.Might even learn a few things about the Real World.

Unless you wanna pay dearly for a status symbol, it's a friggin' waste of money, and for many who stretch to do it, a friggin waste of stress.

I have SFace on ignore, but I have an idea of what he probably said, and I agree with BACAH's post completely. API scores to a certain extent are overrated. A kid who goes to a 930+ API school doesn't have a higher chance of getting into UC Berkeley than a kid who goes to a 890+ API score.

It's all about the percentages. API scores guarantee nothing. Just like a law degree from a Top 5 law school guarantees nothing. It's all about the percentages. You're more likely to earn more with a Top 5 degree, but there's no guarantee.

Perhaps the kid from the 930+ API school has a 30% of getting into an Ivy League school and the kid from the 890 API school has a 25% chance. Is it worth it to pay the premium for the 930 school? Probably not. Sometimes you just want the "best" even if it's not a better value.

It is what it is.

"It is what it is."

I should patent this phrase. :)

E-man says

If I were the POTUS or a CEO of a big corporation, SFace would be my right hand man. This guy is as well rounded as it comes. I'm sorry you don't have the ability to comprehend the information that SFace conveys.

It's funny, your recommendation actually helps me solidify my position on the issue.

zesta says

It's all about the percentages. API scores guarantee nothing. Just like a law degree from a Top 5 law school guarantees nothing. It's all about the percentages. You're more likely to earn more with a Top 5 degree, but there's no guarantee.

Perhaps the kid from the 930+ API school has a 30% of getting into an Ivy League school and the kid from the 890 API school has a 25% chance. Is it worth it to pay the premium for the 930 school? Probably not. Sometimes you just want the "best" even if it's not a better value.

It is what it is.

Also if people actually understood how top schools pick incoming freshman, then they would know that some of the top universities try to pick from the Top 5-10% of the class. So going to a hyper-competitive school can actually hurt an applicants case because it's so much harder to bubble to the top, where if they had gone to a slightly less competitive school, they would have been in the Top 5%. Some parents tried to make a huge issue about it a few years ago because people thought the UC system was unfair, but the system still stands today.

No one cares if you're a 50th percentile kid from Top High School USA with an API score of 990.

Well, HYP (Harvard, Yale and Princeton) usually restrict the number of Indian/Chinese kids. So, just going to Cupertino does not help your kid much. Yes, one can get into UCB, though.

Well for me, I'd rather bank a few million and leave the bay area. Sacramento to me is just as nice even though it is a bit hotter in summer and cooler in winter. Real estate is MUCH less expensive there.

raindoctor says

So, just going to Cupertino does not help your kid much.

Yup.

When I was at Wharton, it's not like every other person I met was from Bay Area fortress cities, in fact I can only remember one guy who was from the Bay Area (San Francisco). Some of the people I met went to fairly unrecognizable 4 year schools as well.