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Where is everyone getting the money?


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2011 Jul 12, 5:04am   39,010 views  162 comments

by exfatguy   ➕follow (0)   💰tip   ignore  

So all of you cash buyers, and those that can afford high down payments in pricy areas, if you don't mind my asking, where are you getting the money? Sometimes it seems like everyone but me in the Bay Area has hundreds of thousands in cash to plunk down on houses. Am I really the only one that doesn't?

So, if you don't mind, enlighten me. Where did you get your money, especially those that can throw, say, $300K-500K (or more) on a house.

Is it...

1. You just worked hard and saved. All blood, sweat, and tears!
2. Worked hard, got a bit lucky with stock options, made out like a bandit.
3. Inheritance
4. Lottery
5. Bought homes at start of (or before) bubble, then wisely cashed out at peak.

So which is it? The only things I might ever have a chance at are (1) and (2), but if that's not enough, then perhaps I shouldn't even bother trying, at least in the Bay Area.

Thanks!

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156   romeotybalt   2011 Jul 20, 12:52am  

Honestly, I got my money by saving after I strategically defaulted on my home.

I was able to take the 3K I was not paying in mortgage in addition to the 2K I was already saving in order to get off the mortgage/debt-slavery treadmill.

157   edvard2   2011 Jul 20, 1:41am  

My parents helped me out but they were certainly not well off. The put $500 down on my first car- an 85' Toyota Celica ( this was back in 1993). They later helped me out with college. My Mother is a teacher and I got a steep discount for community college. I worked all through college. My dad had encouraged me to invest in stocks and mutual funds in high school and put a small amount in one for me when I was little. I added money from mowing lawns into it all through high school and that in turn paid for the last 2 years of college- which was at a 4 year school.

My first new vehicle was a 95' Tacoma. I still drive it and its got about 245,000 miles on it. It was the most bare bones basic model with cloth bench seats, manual transmission, crank windows and no power locks. As basic as they come. Yet it was new and I was very proud of it. Still am and that's why I still have it. I look at the cost of cars today- even the econ models- and its ridiculous how much they cost. $20k is a lot of dough for a stupid car. When I was younger and poor I lusted after new cars. I figured that once I started making decent money I'd buy one. Now that I do make good money I'd rather save the money for a house.

We don't plan on having kids. But if we did I'd probably do the same for them as my parents. I think all too often kids that are given everything on a plate- a new car, college, and so on often don't appreciate it and in many cases waste their college years. Sure- I'd help them out some, but if they really want to get a degree then they'll have to pay for it. It shows they're serious about it and will make sounder decisions. As far as cars- buying a new car for a teenager is ridiculous. Chances are they'll wreck it or trash it before they get into college. Once they're in college the car will either sit or get trashed more. A 5-10 year old car is perfectly sufficient to serve that purpose.

158   Michinaga   2011 Jul 20, 2:13am  

I join the others who are very thankful to their parents for their support during high school/college years.

Mine paid for most of my education at my state university, which was about $9k when I went there in the mid '90s -- I had an academic scholarship for $1k, put in $1k from my own jobs, and they paid the other $6k, leaving me debt-free.

And I had bottom-of-the-barrel jobs all through high school and college. Minimum wage; slavedriver bosses; that kind of thing. It was that or be unemployed.

I really wanted to study abroad, and didn't have the $7k I needed to do it until senior year, so I actually spent half a year abroad after already earning my diploma. When I signed up for the program, it was the first time in my life that I'd spent the entirety of my life's earnings in one big gulp -- buying my condo was the second -- but it was an investment that paid off very well.

I can't even imagine how miserable today's graduates are when they think of that massive debt load on their backs. My first job was a sleep-deprived hell of unpaid overtime and continuous exhaustion, and what kept me going was the knowledge that I could quit at any time with only minor repercussions. Quitting would have been unthinkable had I had $100k in student loans to pay off. Massive props to those of you who work those kinds of jobs -- I hope you're paid well for what they do to you.

159   seaside   2011 Jul 20, 12:30pm  

PersainCAT, thanks for the answers.

I read both before and after the edit, and I am ok with both. I thought you might live somewhere in RT-29 near fairfax county government center. Now I think it's by bradock road near George Mason. The area is pretty nice, and I'd like to live there if, 1. I have money, and 2. I don't have to commute to DC. But 61% income for the housing? What do they thinking? It just is crazy.

Oh, by the way, you've seen this on the youtube?

http://www.youtube.com/watch?v=m3ltMTXlCvk

And you're right. Most homes here in 450K level are 50yr old entry level, the price is... simply wrong especially when think about how much they were 10 years ago. They were under 200K when the county median HH income were arround 80K. With 30% increase in HH income in last 10 years, we got 300% increase in home prices. That's just wrong. But I guess that's how it works in the area. Will it come down to understandable level, let say under 300K? I don't know. I used to live in rural area in western PA for few years, so... you know, I kinda know how you feel.

Again, thanks for the answers.

160   thomas.wong1986   2011 Jul 20, 1:59pm  

seaside says

They were under 200K when the county median HH income were arround 80K. With 30% increase in HH income in last 10 years, we got 300% increase in home prices.

Eventually back to normal trends.
http://www.housingbubblebust.com/OFHEO/Major/MidAtlantic.html

161   Done!   2011 Jul 21, 5:47am  

Ehem!!!!

Allow me. For those of you bitching about 800K homes in "quote"(TOT doing the finger thingie) "Your neighborhood"
Let me remind you...

If you have to ask, then you probably can't afford it.
That is NOT your neighborhood, you were supposed to just drive through and opine for the "one day, someday".

Go find a home with us cretins, NO you are not better than US, you are a middle class comon slob just like the rest of us.

Your sheer ignorance to not accept this reality, helps perpetuate the very thing, you are stunned by. You'rE in line for a house you can never afford, and by blindly participating in the "Willing Pool" of people that would pay that much, if you only had the cash.

You are insuring you never will. A house is only worth what someone is willing to pay after all. And these days, wishing they could, counts as willing. Go away and comeback when the prices come back to reality. But as long as you stand at the foot of the palace gawking and fawning over the place you can't afford. then you never will.

Thank you and Good Night!

162   thomas.wong1986   2011 Aug 13, 12:39pm  

Note: dude lives in Cupertino.. guess he found a way to pay for that $1M pad... This is NOT an isolated case. I hope he burns in HELL for the next 20 years.

Former Marvell Technology Employee Ng Charged in Nationwide Insider Probe By Bob Van Voris - Aug 10, 2011 9:01 PM PT

http://www.bloomberg.com/news/2011-08-10/former-marvell-technology-employee-ng-charged-in-nationwide-insider-probe.html

U.S. prosecutors charged former Marvell Technology Group Ltd. (MRVL) accountant Stanley Ng with conspiracy as part of a nationwide probe of insider trading involving so-called expert networking firms.

Ng, 42, provided material non-public information to Winifred Jiau, a former consultant with expert-networking firm Primary Global Research LLC, according to a criminal complaint filed Aug. 5 and made public yesterday in federal court in New York.

Ng was arrested at his home and appeared yesterday before U.S. Magistrate Judge Bernard Zimmerman in San Jose, California, according to a statement by U.S. Attorney Preet Bharara in New York. Ng was released on a $50,000 bond secured by his home in Cupertino, California, and is scheduled to appear Aug. 26 in court in Manhattan. He faces as long as five years in prison if convicted.

Jiau, 43, was convicted in June of one count each of conspiracy and securities fraud for passing earnings and other information about Nvidia Corp. (NVDA) and Marvell to hedge fund managers Noah Freeman, a former SAC Capital Advisors LP portfolio manager, and Samir Barai, founder of New York-based Barai Capital Management LP.

Barai and Freedman have pleaded guilty and are cooperating with prosecutors

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