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OO,
Definitely. It's scary watching shows like "Flip This House" where you hear the "flipper" saying things like - "let's just slap on the paint coat to cover that spot of black mold," or granite TILES are way cheaper than cut granite countertops, so let's go with the tiles," or anything along the lines of, "I'm hoping to stay under a budget of $XXX, so forget the this-or-that needed repair.
The funniest one of these I saw was a newbie flipper in SoCal who adamantly wanted to make a "Green" flip and had all these grand plans for bamboo floors, solar panels, recycled tiles, etc. Once she started doing the flip and she found out how much each of these things cost above standard stuff, she nixed everything one by one! She even had the gall at the end to say she stayed "Green" by not wasting too much crap!
Peter P,
that's precisely the reason immigrants target areas with good school districts. Going to public school saves a LOT. Can you imagine sending two kids through private schools at $30K each after tax? That is a big ouch.
I have a confession to make. I used to line up at Costco for free food samples, with the hope of making it a meal.
The reason why I stopped doing so was because the line got longer and longer and there were far more vultures waiting at the stall before the food even came out. So I figured that I needed to spend 3-5 minutes per morceau which is not really worth my time, and after circling different food stalls for half an hour, I may still be left only a quarter full. If I spend that half hour working on something more productive, I can make more than a free lunch.
And ultimately, I just stop going to Costco because I can't find enough things to buy there to recoup my membership cost. I just tag along with my in-laws when they buy toilet paper and washing powder, which is all I need from Costco. I shop from Trader Joe's for the rest. Trader Joe's is more like a community shop, so I feel obligated to buy when I take a free sample. Therefore, I try not to descend on the food display if I don't intend to buy.
allah,
These days overpriced is hard to define, I’ll give you an example, my in-laws’ house in the same neighborhood was purchased new from the builder for around 450K in 1994 or 1995 (bottom of the real estate cycle), it’s worth around 1.2 million or maybe more at this time. So that million dollar house is maybe 300K tops 10 or 12 years ago.
Who knows, maybe the toilet bowl is made of solid gold!
sfbubblebuyer
2007 Mar 30, 11:30am
Who knows, maybe the toilet bowl is made of solid gold!
Now THAT'S what I call sitting on your equity!
Look at these posts, obviously made by the same person in Flushing Queens, namely the realtor "wendy kelly" just to try to drum up business.
He just took in $6.00!
Great we can get a list of the people who donate and they can do the bailout!
"If he is so smart why is he poorer than Bill Gates?"
Well so far old Larry put the employees of Siebel, Peoplesoft, and now Hyperion out of a job. Yes I dare say some that were making 160K are
not going to make that salary anymore. Back to the bottom for those
folks.
Yes, Larry is doing were well indeed.
Ha Ha writes,
"160K/year is a VERY ORDINARY salary in Bay Area ….."
As someone who knows what people make, because I see salary data,
I can put a persons face to their salary very easily. Many in Finance have this kind of access.
First off, Company Officers ( CEO, COO CFO VPS) may make 160K.
But thats limited to 5 or so people per company out of 100-500
Engineers with 15-20 years of exp. may approch that but cap out
and dont go beyond rate of inflation. Its too expensive. Again thats
limited based on budgets/profitability. Very limed again maybe 15-20%.
Sales people will get 100K base and rest commissions another 15-20%
of people. They dont make quotas they dont got a job in 6 months.
That leaves you all the rest which are around med. 85K or so.
When salaries get to this level you can bet your pretty dollar management is looking at cost cutting. This is no secret for many in finance department.
Before we talk about 160K in salary is common. I suggest you look around your company and figure who makes what. Dont throw numbers out like everyone drives BMW in Silicon Valley. We all see many drive Toyotas.
160k is a very common family salary, but it is an uncommon salary for an individual. At most 10% make that, even in the land of Milk and Honey.
Fortress Sunnyvale update
This one takes the cake, the house just closed in March. It's got good schools but look at the price.
Type: Detached Single Family
Status: Sold
List Date: 02/21/07
Sale Price: $1,168,000
Sale Date: 03/07/07
Location: 1125 POME AV, Sunnyvale, CA 94087 (map)
Bedrooms: 3
Bathrooms: 2
Approx. Sq. Ft.: 1772
Approx. Lot Size: 7,840sf
Approx age: 44
MLS#: 708446
For a software engineer, 5 years out of school with a MS from a good school can garner 110K easy, I'm not debating the longevity or quality of such jobs, just what the job market is like these days.
For a software engineer, 5 years out of school with a MS from a good school can garner 110K easy, I’m not debating the longevity or quality of such jobs, just what the job market is like these days.
And, if that person joined Apple, he'd have options at a great price. I know someone who just retired after 12 years there.
:(
I know someone who just retired after 12 years there.
So what, someone in my undergrad class is on the Forbes billionaire list (I think his Stanford MBA had a little to do with his success), who's to say you won't retire comfortably in 10 years?
"And, if that person joined Apple, he’d have options at a great price. I know someone who just retired after 12 years there."
Oh yea... so now the additional expense to earnings "cheap stock expense" by apple from strike price to market price is considered compensation by the Apple and hits their earnings. If your a shareholder you would not be to happy.
If say Google was offered shares a 100 and employee excercises at 500
the difference of is additional expense to Google and will reduce net income.
Are you as a shareholder happier?
Not good news if your a start up trying to make a profit.
LOL lets face it typical employee lasts 2-3 years at one place. Are we forgetting the politics and cut throat carp that goes on. Thank god I dont have to brown nose some idiot boss.
Well, salary is salary. If one needs to rely on a wage (especially those who need to rely on 2 wages to buy a million-dollar-shack) to pay the mortgage, feed the kids, he is after all a working class, regardless of how much he makes. That is my interpretation.
One doesn't graduate from the working class and become financially independent until he
1) has a fully-paid off house
2) has an account that can generate a guaranteed annual return that can cover his property tax for 50 years
3) has another account that even when invested very conservatively can generate enough after-tax living cost at whatever lifestyle he chooses for another 50 years
Expenses for 2) and 3) cannot eat into the principal, because once you dip into the principal, then it becomes a very slippery slope.
Before we reach such a stage, the extra $50K or $70K before-tax pay makes little difference. We are all, as the Japanese call it, SALARYMAN.
The Casey bailout is in full swing, he’s up over a $1000. Wild.
I don't know who is dumber, Casey or the people who are giving him money!
Peter P,
There's all kinds of discounts associated with the second kid if you time it (yes, I know what I said) close to the first kid. Clothes, nanny, pre-school, bulk diapers, room sharing after the kids are able to sleep through the nights.
I'm single and I love Costco. I can go shop there once a month and stock up on all the canned good, frozen goods and items of the moment (all returnable within 6 months). I even love their sample tables, not for myself but for parking boyfriend or parental unit.
I find Costco usually has better QC, especially on frozen and canned food, compared to Trader Joe's. They may sell more generic stuff, but I've almost never had a nasty surprise with a purchase.
Also, Costco on weekday noon only works if you're in a largely working town. In the Pleasanton Costco, we find about the same amount of traffic on weekdays and weekends. The weekdays bring out all the bored stay at home moms with three kids in tow. The best time is probably early morning or right before closing.
Glen Says:
"...I remember the early ’90s: Japan-bashing, Pete Wilson, Pat Buchanan, Gulf war I, prop 187, three strikes law, etc.. Ugly times call for ugly politics."
_____
In terms of the proposed conservative solutions (whose response was only proportionate to the severity of the problems at hand), to the madness of the ineffectual and deleterious liberal policies of the day, I thought those were beautiful times.
But I guess beauty, truly, is in the eye of the beholder.
I question your political aesthetic, my friend. I question it with a curious
eye (and one hand on a chocolate chip cookie and the other grasping a cold glass of Hi-C fruit punch).
OO,
Couldn't agree with you more. Whether you're a Costco checkout clerk, grunt engineer or corporate law firm associate, as long as you have the overhanging threat that if you lose your job you won't be able to meet your monthly financial obligations, you're still working class.
Working class -> time worked = wages
Wealthy -> money in investments work for you
So all this talk of techies getting so-and-so salary and what constitutes a "high" salary in SV is overshadowed by the fact that one's financial security is still tied to keeping that job.
Space Ace,
Keep it up with the jaded Silly Valley rants. I love it. :D
astrid,
Excessive visits to Costco constitutes a serious but treatable medical condition. If you can't bring it under control of your own accord we might have to do an intervention. :)
Remember your friends at patrick.net are there for you!
PS, (I know, you don't care!)
skibum,
"Green" flips. Now I've heard it all!
OO is spot in with his appraisal of quickie flips. True, long term homeowners realize to let a place slide into disrepair creates an insurmountable situation. Rather than become overwhelmed we realize it takes a genuine balance not bite off more than you can chew.
Every year my wife and I sat down and penciled out the things that 1) absolutely needed to be done, 2) things that "should" be done and 3) things that "would be nice" to be done.
It's really not that difficult. Anyone renting a truck, enlisting co-workers they barely know (regardless of their qualifications) and scrambling around at the last minute just doesn't impress me. Sorry. Home maintenance is an ongoing and constant project. The whole "bang for the buck" and curb appeal approach really messes with me.
In terms of the proposed conservative solutions (whose response was only proportionate to the severity of the problems at hand), to the madness of the ineffectual and deleterious liberal policies of the day, I thought those were beautiful times.
But I guess beauty, truly, is in the eye of the beholder.
It was not conservative policies or liberal policies that ended the recession. These things just need to play themselves out. My point was just that the worse things get, the more the public supports aggressive law enforcement and scapegoating as the "solution." This may placate voters in the short run, but it can be dangerous in the long run.
OO,
I'm almost in complete agreement with your interpetation of "independently wealthy". Dipping into your principal is something most truly wealthy people are loathe to do.
In my mind (and I'm sure this won't fly without "some" criticism) it hinges on whether or not you intend to leave a "financial legacy"? If it's your intent to have children/surviving spouse that won't "have" to work then yes, that's absolutely essential. For the other 94% of us, if your last check to the undertaker bounces, you timed it just right!
To quote one of the old navy chiefs I used to work for: "I don't want my wife to have to go down to the street corner and sell p$ssy, but I'll be DAMNED if she's going to go around town BUYING d!ck!"
"This one takes the cake, the house just closed in March. It’s got good schools but look at the price.
Type: Detached Single Family
Status: Sold
List Date: 02/21/07
Sale Price: $1,168,000
Sale Date: 03/07/07
Location: 1125 POME AV, Sunnyvale, CA 94087 (map)
Bedrooms: 3
Bathrooms: 2
Approx. Sq. Ft.: 1772
Approx. Lot Size: 7,840sf
Approx age: 44
MLS#: 708446"
You got to be kidding me. I think the schools are: Cumberland, Sunnvale Junior High, and Homestead HS. $1.2M Not worth it for those who lived in the area for awhile. Probably someone from abroad that doesn't know any better. Proabably will foreclose in 24 months.
Signed up for a free trial in a foreclosure sight. It's amazing how these homeowners take out a HELOC or second mortgage. $65,000 here, $150,000 there, I need $50,000 now... By the time they are set a done they turned a regular $375,000 initial mortgage to a $800,000 ARM. Paper wealth and a match waiting to be lit at any given moment. Poof! it's gone.
Delta Pappa,
You're obviously just a JBR that doesn't understand the "new rules for money"! Why you hate Amerika? :)
Oh and speaking of "the new rules for money" how IS Ric Edelman getting along these days? (He's the original NEVER pay off your mortgage) and the very first debt =wealth disciple!
Some of his original basic ideas made sense but like Walter E. Kurtz "his principles became... unsound... unsound".
Okay - so how about this for a story - heard about a family who have bought a 2 bedroomed house in Cupertino (not sure how much they paid but over $1m) for the school district - still got their old house - which they plan to rent out (not ready to rent out yet and they have to start paying for both mortgages in the next month or so). They have four children - the idea being this is cheaper than paying for private school - any comments as to the validity of this?
DP - on the foreclosure site - are there many in Mountain View, Sunnyvale, Los Altos, Cupertino area? It would interesting if you could give us an update as the year goes on as to whether the numbers rise significantly.
One couple we know just threw in the towel and bought a house in Los Gatos. They bought at 6-7x income, and the wife doesn't work. No kids, yet. Some people are still jumping in.
I'm seeing a slow, steady growth of inventory in parts of Central SJ, Rose Garden & Willow Glen. Do these areas have bad schools?
Claire Says:
> Okay - so how about this for a story - heard about a
> family who have bought a 2 bedroomed house in
> Cupertino (not sure how much they paid but over $1m)
> for the school district. They have four children - the idea
> being this is cheaper than paying for private school –
> any comments as to the validity of this?
Here in San Francisco the base tuition for a top K-8 school (like Town, Cathedral, Burke or Hamlin) is over $20K so when you add in Books, Uniforms and the minimum mandatory fees (and blew off all the semi mandatory giving) you would be at about $88K or $7.3K a month after tax dollars or just about the same after tax out the door as having a $2mm IO loan. If the good private schools in the Cupertino are about $10K per kid the tuition will cost about the same per year after tax as a $1mm loan…
Someone wrote:
> The Casey bailout is in full swing,
> he’s up over a $1000. Wild.
Then allah Says:
> I don’t know who is dumber, Casey or
> the people who are giving him money!
I went over to Casey’s site to see what he did to get so much money and it turns out that he got a fake $850 donation (but is still over $300 since he sold the blue ball)…
Peter P
2007 Mar 31, 5:01am
that’s precisely the reason immigrants target areas with good school districts. Going to public school saves a LOT. Can you imagine sending two kids through private schools at $30K each after tax? That is a big ouch.
I think my 300K NPV calculation assumes public school education.
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One of the more interesting side-effects of the housing bubble's collapse is its ability to produce victims from some rather unexpected places. For example: Lennar Corporation, one of the nation's largest home builders which profited handsomely during the run-up (and has been accused by some of substandard workmanship), has just officially been granted victim status from the media:
Apparently, the recent sub-prime credit crunch has also produced quite a few human victims among those who can no longer borrow beyond their means indefinitely and add to their already crushing debt loads:
And the damage is not just limited to uneducated, Joe 6-pack types with limited means and bad credit. Look what just happened to a PhD with a good job:
If these people can become media "victims" of the housing bubble, who's next? Some possibilities:
Alan Greenspan:
"I was forced to lower rates to 1% to moderate the tech bubble recession, and to make the economy look good, so incumbents could get reelected. Those big, mean politicians were really pressuring me! How was I supposed to know it would spawn an even bigger bubble in real estate?? I'm just a powerless (former) central bankster!"
David Lereah:
"I didn't want to keep fanning the flames with outrageous lies and baseless industry propaganda, but I had to feed my family. The NAR kept on blackmailing me with my enormous salary and benefits. What was I supposed to do --quit and become a regular working-stiff like all you low-rent schmucks out there?"
Gary Watts:
"If I didn't come right out and say '15% was in the bag' for 2006, they would have hurt my family. I practically choked on those words, but it was either say it or 'lights out' for little Billy and Janie. I had to choose between my family or my integrity --what would anyone have done in my situation?"
Casey Serin:
"How could I say 'no' to such sweet deals, when everything I learned from those R.K./Robert G. Allen books and seminars was screaming 'Yes, yes, yes!' Besides, Galina was really pressuring me to 'get a house'. How was I suppoosed to know she meant only one? Besides, all those sellers really tricked me --they used my Macaroni Grill & Jamba Juice addiction to talk me into those illegal cash-back deals. They preyed on my fears of being a Looser and took full advantage of me. I feel so... violated."
Discuss, enjoy...
HARM
#housing