patrick.net

DinOr,

You do realize that I was being sarcastic, don't you? There is nothing that is going to stop house prices from falling. However, you have these idiots who are going to start class action suits and I'm sure they will get something for being "scamed" so to speak; with so many people in that same boat, you can only expect more lawsuits in the not so distant future.

To pay out these FB's, this will most certainly push more lenders to go bankrupt as a result and with all the more MBS's failing with lenders that are no longer around to buy them back, who do you think will be stuck paying the bill?

Just a thought.

carlorossi Says:

"...The point I want to make is that the BA real estate market has a life of its own. I wish it would not be that way because I would rather own than rent. I am waiting for the market to finally go lower but my hair is already turning grey. A 2200 square ft house next door, on a busy street, just went for over $1.5 mill..."
_____

I grew up in SJ but am in Phoenix now.

There was always a premium to live in the Bay Area.

But it's so far out of whack and has been climbing for so many years,
that we think it'll always be the status quo forever and that prices are nearly impervious to major corrections.

I think Japan is a good example of the slow grind downward that may transpire. Hopefully, it'll be faster than Japan so that people don't have to agonize for as long.

I think this baby is going way down. The fundamentals just aren't around anymore to support these high-flying prices.

Gravity and financial physics will ultimately prevail.

Believe it!

DD
You are not alone! I just don't rise to the bait - statistically speaking it is impossible for everyone in the BA to be earning over 100K even. I am also someone that was born too late to cash in on the housing market, however, I think there will be an opportunity in the future (maybe even 10-20 years away), we just need to keep an eye out and recognize it when we see it and be in a financial postion to take it (i.e try to save some cash).

allah,

Yes of course. I just thought it was so convenient for these couples to say "we did it for our kids"! Rally? There wasn't any possible way for you to tighten your belt? No? None?

It's just such an "easy out" for these people. I can't believe the judge ruled so quickly? Don't these things take forever to play out? I mean they're going to get back the fees, int. and all their payments and live in their borrowed home for free for what? 3 Years? Sign me up!

Huh? Are you suggesting something less than ethical on this nice thread?

DD,

Did you look at my post above regarding salaries mentioned in the fortune survey ? I talked about technical salaries - but their report has non-tech salaries as well.

Do not get a distorted picture from what FaceReality says. Every company has CxO executives. Looking at their salaries is like looking at the QB salaries and saying everyone in NFL makes multi-million $ salaries. Even tech jobs have a food chain. The peons at the lower end do not make anywhere near the average.

The salary myth is the most annoying thing about BA. Salaries are high, but not astronomically high. Everyone is so obsessed about what the person in next cubicle is making. When the proverbial tide goes out, we will all see who is swimming with what swimsuit.

Claire :

We are just at the top of the 2nd innings. At the top of 1st, the sales started going down and the median went "flat". At the bottom of 1st, MSM smelled something funny and REIC started calling for a turnaround.

It's a slow game. Nothing we can do about it.

How can people think that prices AND demand will go up forever, and not only that they are the same line?

This is not the first bubble, and won't be the last.

Maybe the right time to buy was 10 years ago, but 10 years ago I was in junior high school! My friends in their late 20s/early 30s have left CA in droves to have access to more affordable homes in other parts of the country.

This is where gen X, Y and Z are going to be in trouble. Or else they will cause the whole market to unwind simply because no-one will be left to buy at current market prices and the Ponzi scheme collapses. Of course, this is the sheer beauty of unfettered capitalist markets -- they are self-correcting and always right, even though they inflict a lot of anxiety and pain on a lot of people as it happens, in both directions. You've got to take the bad with the bad, you know...

Here's an interesting article.

How about a JBFB then?

Does anyone have that original quote handy about Hondas and tent cities? google doesn't throw it up, altho it appears regularly on blogs, presumably by the same poster. I actually want to use it in something... it appears one or twice on patrick.net, but it's a little difficult searching the archives...

this?

Everybody who doesn't buy now will be priced out forever. Anybody who does buy will be rewarded with a lifetime of riches, as their property will continue its 25% yearly price increase.

This asset bubble is different from all of the others - it will never slow down or pop. The gains are permanent.

Top of the 2nd inning? I hope Andy Pettitte is pitching.

Also, I will not live in a Honda.

Thank you. This time I will save it to the desktop as tent cities.txt ;) Simple but beautiful...

> And his wifey is thinking about sending kid number
> one to some high-pressure school that costs $12K
> per year. Oh double shit.

It seems like the cost of good Bay Area schools is increasing by about $1K a year. Less than 10 years ago good SF grammar schools like Town, Burke, Cathedral and Hamlin were all well under $10K a year and now I’m pretty sure that all are over $20K a year (a friend who grew up in Pacific Heights just told me that they are planning to move to Marin this summer since Cathedral and Hamlin just pushed past the $20K per kid mark). If the ~$1K a year increases continue the parents of two kids will pay over $400K in tuition before the kids start High School…

But if a rich googler wants to just GIVE me money for nothing in return, I’ll gladly take it

The WSJ was reporting that the Office Admin at YouTube got at least $1mil from the buyout.

GC,

Huh. Don't you work at the grand ole motherload itself?

lunarpark Says:
Top of the 2nd inning? I hope Andy Pettitte is pitching.
innings... bowling...

Also, I will not live in a Honda.
Actually, I like the styling of the new Mazdas over most others. I think I would prefer a Mazda 3 to a BMW 3. Altho a bit cramped to live in...

DS :

Pitching is right. No cricket here :-( (Ironically, the thread post does mention cricket, but that's a different one.)

I don't know about Mazda 3, but our Mazda 6 has traction issues in wet weather.

I’m not worried about buying a house right now, I’m OK renting and saving some money, but the cost of the BA is still astronomical. Even the cheap food here is more expensive than in SoCal (where I’m originally from).

That's because the food here is special. They're not making any more.

It's one of the things that kills me about the Bay Area - when natives say "Well, aside from Housing, it's not that expensive here." WTF! That's like saying "Aside from the end-stage cancer, I'm pretty healthy."

If you want to save on food, you'll have to go somewhere that's not special...

http://www.burbed.com/2006/11/23/how-to-save-20-on-your-groceries-for-thanksgiving/

Thank you. This time I will save it to the desktop as tent cities.txt ;) Simple but beautiful…

You're welcome, however there are several different versions of it so we really don't know what the original is.

“But he has two kids, so the daycare expenses will eat up most of what she earns.”

I thought google was buying up an old Mountain View school to turn it into free daycare...

BA food is very expensive. The farmer's market in Pleasanton is about 2X the price of the farmer's market in Claremont, and both are about the same in terms of composition, status and proximity to prime food producing areas.

FAB,

Yep, the elementary schools are all about $20,000. Middle school is more, then high school is more.

allah,

There isn't enough equity on earth for me to cash out and flee back to (undervalued) Upstate NY. My brother told me they just got 4 feet of snow. When he called me yesterday the windchill was about -15. If I sold my places and took my equity back there I'd be shuttling to the Caribbean every weekend all winter. I'd use up my equity on airfare and hotel trying to escape the place!

Allah, that's an interesting article.

I wonder how many would a) succeed in selling into this market, b) find it possible to transfer their work to Charleston, WV or C-Urbana, IL, or c) adapt to the 'culture' of the various towns mentioned.

To my mind, there's a reason these areas are priced as they are. I think I mentioned before that from 2000-2006, RE values fell in Charleston.

there are several different versions of it

I think the original sacred text has survived fairly unscathed, there's a few references to it, but none as good as the original. ;) the bizarre thing is i googled similar words without the quotes, and no relevant hits came back within umpteen screens...bizarre. somebody needs to talk to those clowns at google, i don't think that co. has a future unless they employ some good people... who was the original poster? they are like the prophet in the desert, and will be revered one day...

"There isn’t enough equity on earth for me to cash out and flee back to (undervalued) Upstate NY. My brother told me they just got 4 feet of snow."

Ahh, snowy NY. I remember the winter I spent with my ex in Amherst. He was a pro athlete. I'll never forget when he called to say he'd been traded to Buffalo. I nearly dropped the phone. I ended up loving it there, but then again it was just for one season.

Your friends $200,000 or $400,000 incomes aren’t going to go very far here without a toxic loan or overextending themselves and not being able to go out or travel.

Unless they're first gen immigrants. Then it won't matter because they don't like to go out or travel, or turn on the heat. :(

New Rule: USA Citizenship now requires a spending minimum.

eburbed,

What have YOU done today to contribute to the negative savings rate!

:)

StuckinBA

I really hate all the stop play and time outs - isn't there another game they can play?

eburbed,

I think we should encourage everybody to install better insulation and wear cardigans. Not travelling and not eating out are also good, less competition for me. I plan to be a renting DINK for a very long time, so I would love for everyone to act like first generation immigrant (though technically, I am also one).

DD Says:

> I graduated college (UCB) about a year ago with a
> degree in Business Admin, but quite honestly the degree
> has done me jack. I make less than 50k a year as a marketing
> coordinator/assistant for a commercial real estate firm

You need to get out there and network since you should be making at least 50% more with a degree from Cal and with a little luck you can hope to make 100% more in a couple years. Check out http://www.sfrex.com/ (a group of young real estate professionals) and Google to find sf spinsters (a group of mostly ex Sorority girls looking to get married who can be annoying at times but since about half of them grew up around here and went to Burke, Hamlin or Convent they know lots of people and can get you in the door at any firm in town).

> (so yes I work in RE, but we do Warehouse/Industrial along
> the 880). Maybe I’m not ambitious enough and maybe soon
> I need to look for a better job, but an income of 100k is far
> beyond my reach and for someone to say that 200k a year is
> the norm makes me feel like a REALLY BIG LOSER.

You are a little below the norm for a Cal grad, don’t feel bad since it is only the top grads from the top grad schools that make $200K to start (almost no one makes $200K out of undergrad)…

> Everyday I ask myself, “Why the hell am I still in the Bay Area?”

If you don’t have a strong connection to the Bay Area it does not make a lot of sense to live here. If I didn’t grow up here and have my entire family here I would be somewhere else (living in a huge home with a six car garage)…

nice blog you've got there, allah...

SFWoman:

There isn’t enough equity on earth for me to cash out and flee back to (undervalued) Upstate NY. My brother told me they just got 4 feet of snow. When he called me yesterday the windchill was about -15. If I sold my places and took my equity back there I’d be shuttling to the Caribbean every weekend all winter. I’d use up my equity on airfare and hotel trying to escape the place!

There are other places that aren't cold such as in the south. It may not be for everyone, but many are choosing to do just that. What it really boils down to is what is more important to you, better climate or better standard of living.

Bruce:
I wonder how many would a) succeed in selling into this market, b) find it possible to transfer their work to Charleston, WV or C-Urbana, IL, or c) adapt to the ‘culture’ of the various towns mentioned.

There are other places and believe it or not, there are business that are moving now and in the near future to these "underpriced" areas. People in the overpriced areas are going to be so stressed out and companies in those areas will find that they can find less stressed out workers with fewer financial problems for lower pay than have their own workers complain about raises. They have successfully outsourced many jobs overseas; why wouldn't they be able to do the same in other states?

As far as culture, when you have so many people of your own kind moving to the same place, the culture is moving with you. In Long Island NY for instance, many people have been selling and moving to GA and N.C. Many will argue those places down south are infested with rednecks. That may be true in the areas that Long Islander's aren't moving to, but the huge amount of brand new developments are filled with people such as Long Islander's; in fact there is an area in Wilmington that they call "Little Long Island". If you stray too far from any good area, you will find yourself amoung lowlifes and crime.

Everyone has their own reasons for staying or leaving, but here on Long Island, the taxes are insane! Many have left and are very happy to no longer be part of the rat race that Long Island has become.

nice blog you’ve got there, allah…

Thanks, actually its not a blog but a web site.

yes, i wasn't sure the right word to use. does a blog need to have user comments by definition? or just the concept of a diary. i guess your posts aren't dated...

Asking $719,900

http://www.mlslistings.com/common/properties/propertyDetail.asp?open=0&page=3&mls_number=705872&type=property&name=

Zillow shows the following:

01/11/2007: $710,917 ?
06/07/2005: $825,000 ***
08/27/2004: $515,000

They haven't even "owned" it for a month and it's for sale, flip?

Everyone has their own reasons for staying or leaving, but here on Long Island, the taxes are insane! Many have left and are very happy to no longer be part of the rat race that Long Island has become.

Since I'm originally from Long Island - I'd like to point out that Long Island was always a rat race. How could it not have been?

But then again, I rarely ventured past the Nassau County line.

The high property tax rate in LI does have a positive feature: fantastic schools. Like Herricks. (Not like Roosevelt.)

If you have 2+ kids, living in LI is a great deal compared to living in the Bay Area. You buy a $800k starter home in Mountain View and your kids have to learn about the Nortenos and the Surrenos? WTF.