patrick.net

The message I take from this article is that it is horrible time to buy a home but a great time to sell one if you live in the Bay Area.

"At the same time, Portola Valley, Atherton and Palo Alto - with million-dollar-plus median values that now exceed their boom-time heights - should see appreciation above 12 percent, Zillow said."

Well, didn't I mention this in the other thread? It's all about location, location, location. @Patrick just keeps saying look at your rent vs. buy ratio, but doesn't factor in the appreciation these Fortress markets have been enjoying for decades. Had Patrick bought in 1998, he would have been sitting pretty now instead of creating this website for us to chat, argue and whine.

SFace says

contrary to popular belief. (The expensive areas have ways to fall back in 2010/2011)

The takeaway is zip codes that are the last to fall are the first to rise. This is always the case in any corner of the world.

I fought Patrick for years to not let the buy/rent calculator dictate your decision as it is useless. The calculator says buy in the Ghetto and don't buy in prime, that's it. It gives the wrong/opposite signals. Here is the proof why.

This is generally true but expensive areas can fall back more on nominal values (not percentage.) If you can afford it, expensive areas always have higher ceiling. Theoretically, a rent vs. buy calculator can work but the appreciation/depreciation part is anybody's guess.

robertoaribas says

evilmonkeyboy says

The message I take from this article is that it is horrible time to buy a home but a great time to sell one if you live in the Bay Area.

bad logic on your part.. .why sell today, if the price will be surging much higher over the next six months? don't be like @underwaterman who sold last year and left a fortune on the table!

I agree with the first part of evilmonkeyboy's comment (it's a horrible time to buy in SF Bay Area), but Roberto is right about the near future. One of Roberto's comments put it very well: the time to sell is when more listings start showing up, then underprice the market by a little bit. Right now, there aren't enough listings to keep up with demand, and there isn't enough construction to change that in the near future. If SF Bay Area allowed more construction in areas that are already built up (i.e. not parks), this kind of bubble wouldn't get so big, but the law isn't changing any time soon and construction doesn't happen overnight - yet.

In what direction? Down is the only one I'll believe, and I don't even live in the Bay Area. I hear you need to be a millionaire to buy a condo out there already, doubt there will be a price increase, market fundamentals look weak.

FortWayne says

I hear you need to be a millionaire to buy a condo out there already...

Nah - just sign on the dotted line, finance 97% with a loan that Fannie or Freddie will buy and Bubbles Ben will add it to the Fed's balance sheet. Red is the new black, i.e. debt is the new "wealth".

Yes. Our state is fixed!

http://www.zerohedge.com/news/2013-02-19/californias-budget-miracle-mirage-after-all

At least that's what the government says...

robertoaribas says

evilmonkeyboy says

The message I take from this article is that it is horrible time to buy a home but a great time to sell one if you live in the Bay Area.

bad logic on your part.. .why sell today, if the price will be surging much higher over the next six months? don't be like @underwaterman who sold last year and left a fortune on the table!

I don't own property in the Bay Area, but if I did I would cash out this summer. There are to many investors in this market, the 20% down buyers are gone (not many people can save up 140K) and FHA loans are getting a lot more expensive this year.
With price up 30% year over year in Santa Clara Co. and homeowners not buying houses it is not going to be pretty when the bubble pops.
You may be right, maybe the Bay Area will just keep going up in 2013 but to me it is not worth the risk.

curious2 says

I agree with the first part of evilmonkeyboy's comment (it's a horrible time to buy in SF Bay Area), but Roberto is right about the near future. One of Roberto's comments put it very well: the time to sell is when more listings start showing up, then underprice the market by a little bit. Right now, there aren't enough listings to keep up with demand, and there isn't enough construction to change that in the near future. If SF Bay Area allowed more construction in areas that are already built up (i.e. not parks), this kind of bubble wouldn't get so big, but the law isn't changing any time soon and construction doesn't happen overnight - yet.

I agree with what you and Roberto are saying it just that underpricing the market by a little bit in the Bay Area dropping 100k off the price. I would rather get out an invest that money in a market that isn't so bubblisious.