patrick.net

Malkovich! I am in a similar boat. I have had good down payment money for a long time. I wish I had just bought a couple years ago when prices were somewhat low, but everything felt rigged even then. At this point, I'm turning from sort of a social democrat to a communist, I don't think people should be able to profit on any item that is a necessity: medicine, housing, basic food. The housing market is just plain nuts. I was born and raised in Palo Alto, lived most of my adult life in SF, there is nothing I can afford that is not an extreme fixer upper, and I don't have the skills, money or know-how to do the fixing. Meanwhile my cash has sat for years, not earning interest, because at heart I am not a gambler. I'm a hard worker, a sensible person, but I don't have the balls to gamble what it's taken 35 years of work (mainly as a seamstress/costume designer) to accumulate. It's all very distressing.

I lived in Oakland. The ice cream shop I used to frequent when I was younger now has an armed guard at the entrance. This is in the "nice part" of Oakland, too. Time for Oakland residents to stop apologizing for the thugs and do something about them.

Jemaho says

Malkovich! I am in a similar boat. I have had good down payment money for a long time. I wish I had just bought a couple years ago when prices were somewhat low, but everything felt rigged even then. At this point, I'm turning from sort of a social democrat to a communist, I don't think people should be able to profit on any item that is a necessity: medicine, housing, basic food. The housing market is just plain nuts. I was born and raised in Palo Alto, lived most of my adult life in SF, there is nothing I can afford that is not an extreme fixer upper, and I don't have the skills, money or know-how to do the fixing. Meanwhile my cash has sat for years, not earning interest, because at heart I am not a gambler. I'm a hard worker, a sensible person, but I don't have the balls to gamble what it's taken 35 years of work (mainly as a seamstress/costume designer) to accumulate. It's all very distressing.

Thanks for commiserating. I hope you don't also have a friend who thinks he is a financial genius because he was lucky enough to buy in those magical two years. It rubs salt in the wound. =)

RE your down payment money: You may want to put that in some conservative mutual funds. My banker has earned a boring yet solid 10-12% on my money for the last three years. She has my money spread out in about 10 different funds and has set it up so I can liquidate with minimal costs (class B shares, etc. - my eyes glaze over when she starts explaining it all - I just want to see the bottom line).

Thanks so much, Malkovich. I know I should be smarter with my money. I have a much needed lull in workload, and I am hacking away at my to do list, and I will put that on it. I think about Portland, certainly lurk on real estate sites as if they were porn sites and I an addict. Portland has also gone up like crazy, but it is still doable for me. However, I would have to flood my house with sun lamps and hope not to get suicidal. I wish you luck.

wave9x says

I lived in Oakland. The ice cream shop I used to frequent when I was younger now has an armed guard at the entrance. This is in the "nice part" of Oakland, too. Time for Oakland residents to stop apologizing for the thugs and do something about them.

Wow, that doesn't sound like the parts of Oakland I usually frequent (Temescal, Rockridge, Piedmont Ave, Grand/Lakeshore Ave, Park Blvd).

What street is this ice cream shop on?

No disagreements on Oak residents being fed up with their city's leadership. Then again, I have some pretty big problems with SF gov't too.

Jemaho says

I think about Portland, certainly lurk on real estate sites as if they were porn sites and I an addict. Portland has also gone up like crazy, but it is still doable for me. However, I would have to flood my house with sun lamps and hope not to get suicidal. I wish you luck.

Agreed. I go to visit friends in Portland every year. Though I always go in August when the weather is perfect. I thought about Portland a lot too (it really is the only place an SF-er can go) but, yes, the weather is a deal-breaker.

Jemaho says

Portland has also gone up like crazy, but it is still doable for me. However, I
would have to flood my house with sun lamps and hope not to get suicidal. I wish
you luck.

As stated before, I was born and raised there. I recently looked up the house that I grew up in (from age 3 till 15). I did know that my parents bought it in 1956, from Zillow I recently learned that it had been built in 1919. I know my parents bought it for $12,000 back then. When I checked on Zillow, it was now appraised at over $450,000. Yeah, Portland isn't all that cheap anymore.

Malkovich says

Agreed. I go to visit friends in Portland every year. Though I always go in
August when the weather is perfect.

Two seasons up there - the rainy season and August.

Jemaho,

With the fiat money system, many governments tends to print money. Hence, long term, money is fast depreciating and is preferably to hold real asset such as real estate. It is not gambling, merely hedging against inflation (depreciation of money). If you can't afford real estate, the best vehicle is dollar-cost averaging purchase of a near no-load index fund such as one based on S&P 500. Not to rain on Malkovich, the average annual return of such an index fund over the last three years is 15%-20% depending on when you start investing.

You may wish to read up on what is meant by dollar cost averaging, no load and pros/cons of an index fund (ask you agent or simply do a web search).

hanera says

With the fiat money system, many governments tends to print money. Hence, long term, money is fast depreciating and is preferably to hold real asset such as real estate.

A few questions flow from that:

Are real estate markets really not subject to the whims of governments? If government money-printing, as you call it, causes economic downfall, how do you know that real estate in that country will be insulated from that chaos?

Similarly, since your alternative is an S&P 500 fund, what makes you think that an economic downfall wouldn't affect your stock withholdings?

corntrollio says

hanera says

With the fiat money system, many governments tends to print money. Hence, long term, money is fast depreciating and is preferably to hold real asset such as real estate.

A few questions flow from that:

Are real estate markets really not subject to the whims of governments? If government money-printing, as you call it, causes economic downfall, how do you know that real estate in that country will be insulated from that chaos?

Similarly, since your alternative is an S&P 500 fund, what makes you think that an economic downfall wouldn't affect your stock withholdings?

I'm referring to long term and not talking about economic downfall, in fact, talking about going through many economic cycles (booms and downfalls).