More people leaving the state than entering this year (Irvine: buy, depreciation)

[jc76]

Originally Posted by Twinkle Toes

Texas is where I learned NOT to use turn signals - you never want to tip off the enemy to your next move!

Hahaha!!!

I have to add something to the original topic. I recently was told by a few family members that on CNN California was once again the winner of the state most people fled from in 2008. Do any of you see California ever being an affordable state again? I don't mean houses dropping from 1 million down to 600K either, I mean AFFORDABLE as in 100-250K for a decent home. I don't have a time machine to take me back to 1970, but maybe the future holds real affordable housing??? If the housing would get in line with the rest of the country I think CA's economy would rise up because more people would move there, or move back there. Most everything in CA but the housing in pretty in line with the rest of the U.S. it seems.

[BennyPhoenix]

Originally Posted by jc76

Hahaha!!!

I have to add something to the original topic. I recently was told by a few family members that on CNN California was once again the winner of the state most people fled from in 2008. Do any of you see California ever being an affordable state again? I don't mean houses dropping from 1 million down to 600K either, I mean AFFORDABLE as in 100-250K for a decent home. I don't have a time machine to take me back to 1970, but maybe the future holds real affordable housing??? If the housing would get in line with the rest of the country I think CA's economy would rise up because more people would move there, or move back there. Most everything in CA but the housing in pretty in line with the rest of the U.S. it seems.

You can buy a decent home for 250k in the Inland Empire and many other places.
In L.A. or SF it will never happen.

[Twinkle Toes]

I don't think housing is ever going to be as low as 1970's levels again. You just have to pick an area and see what's in that area that fits into your budget. We are fortunate in that we can fit a lot into our budget, but it really helped that when we came back to CA from our 9 month stint in TX, the housing prices were much lower. We sold our Palm Desert home at the peak of the high prices and moved to Texas. Fortunately we were able to sell the Texas house and get into another really nice home in CA - but for much less than we would have spent had the market not been sliding down the tubes.

[dweej]

Originally Posted by jc76

Hahaha!!!

I have to add something to the original topic. I recently was told by a few family members that on CNN California was once again the winner of the state most people fled from in 2008. Do any of you see California ever being an affordable state again? I don't mean houses dropping from 1 million down to 600K either, I mean AFFORDABLE as in 100-250K for a decent home. I don't have a time machine to take me back to 1970, but maybe the future holds real affordable housing??? If the housing would get in line with the rest of the country I think CA's economy would rise up because more people would move there, or move back there. Most everything in CA but the housing in pretty in line with the rest of the U.S. it seems.

I second the poster who mentioned the IE as a place to find a home in that price range. The prices are now "affordable" but the location is not ideal. Temecula, where I live, is quite a lovely little town. Good schools, pretty topography, etc. Unfortunately, not that close to the coast, no four year university, long commutes to major job centers, no hip/urban options (if you're into that sort of thing )and quite toasty warm in the summer. If someone needs to live in SoCal, this is the place to find affordable housing in a family friendly environment, but you'll have to give up on all the stuff I mentioned. If you look closer to the coast/jobs/universities, the home prices will probably never be affordable when compared to the majority of the rest of the U.S.

[SOON2BNSURPRISE]

You can find homes in Oxnard, Ventura, and Port Hueneme under $300,000.

[Ludachris]

Originally Posted by jc76

Hahaha!!!

I have to add something to the original topic. I recently was told by a few family members that on CNN California was once again the winner of the state most people fled from in 2008. Do any of you see California ever being an affordable state again? I don't mean houses dropping from 1 million down to 600K either, I mean AFFORDABLE as in 100-250K for a decent home. I don't have a time machine to take me back to 1970, but maybe the future holds real affordable housing??? If the housing would get in line with the rest of the country I think CA's economy would rise up because more people would move there, or move back there. Most everything in CA but the housing in pretty in line with the rest of the U.S. it seems.

The problem is that the SF region is filled with super high paying jobs and highly educated people who make a lot of money. It's got its own micro economy. Only if that economy disappears will it ever drop in price. LA is LA - I doubt it will ever drop in price.

[sheri257]

Originally Posted by vfrpilot

I look at this from a different angle. I think the loss of property value and the slow real estate markets is actually keeping people in CA who would have fled otherwise.

That's a possiblity but, not likely. From 2000-2001, the out migration was only 39,000 people versus 285,000 during the peak of the market when housing prices doubled from 2005-2006.

http://www.brookings.edu/opinions/20...charts_2_3.pdf

Presumably in 2001 a lot of people could have bailed if they wanted to ... especially since the real estate bust of '92 was long over and prices started to recover in '96. Yet, only 40,000 left the state.

And nothing is really preventing people from walking away now. Afterall, that's why we're having this major housing crash.

When you look at the data ... the out migration directly tracks with housing prices. The simplest explanation is probably the best one. When houses get more affordable, people stay. When they're not, people leave.

[sheri257]

Originally Posted by jc76

I don't mean houses dropping from 1 million down to 600K either, I mean AFFORDABLE as in 100-250K for a decent home.

Where I want to buy median income is 105K so ... I seriously doubt anything in that neighborhood is going to drop to 250K. 400K maybe ... but not 250K.

It also depends on what kind of bottom predictors you want to use. The type of house I'd like to buy sold for 300K back in 1999.

If you figure a house like that would normally appreciate 5 percent a year then ... the bottom price would be 450K.

If you figure 3.5 times income then ... a house like that should be worth 370K.

What is that house actually selling for right now? It's under contract for 575K.

I think I'll be lucky if the same type of house drops to 450K in the next couple of years.

[OC Investor2]

Originally Posted by sheri257

That's a possiblity but, not likely. From 2000-2001, the out migration was only 39,000 people versus 285,000 during the peak of the market when housing prices doubled from 2005-2006.

http://www.brookings.edu/opinions/20...charts_2_3.pdf

Presumably in 2001 a lot of people could have bailed if they wanted to ... especially since the real estate bust of '92 was long over and prices started to recover in '96. Yet, only 40,000 left the state.

And nothing is really preventing people from walking away now. Afterall, that's why we're having this major housing crash.

When you look at the data ... the out migration directly tracks with housing prices. The simplest explanation is probably the best one. When houses get more affordable, people stay. When they're not, people leave.

Stipulating that your numbers are accurate, this may have been true for the last decade or so, But what about before? Did'nt California enjoy significant "in-migration" during the 1970's & 80's even as house prices rose faster then the national average? It was before my time here, but I have heard that much of So Cal real estate boomed in the 80's, yet the people kept coming.

If this is so, that would seem to indicate something different is going on. It may just be the maturing of the state & a levelling of its economic growth - the law of large numbers and all that. Or it could be something more dangerous - a sign that the the drag of high taxes, a poor business climate and the rising costs of living may have finally killed the california dream.

Either way, the optimistic assumption of economic growth need to go out the window. That steady, often explosive, growth has allowed the state to get away with alot of economic errors and fiscal neglect over the past 50 years. With the margin of error it provided gone, its time for this state to get its collective head out of its you know what and start dealing with reality again.

[sheri257]

Originally Posted by OC Investor2

Stipulating that your numbers are accurate, this may have been true for the last decade or so, But what about before? Did'nt California enjoy significant "in-migration" during the 1970's & 80's even as house prices rose faster then the national average? It was before my time here, but I have heard that much of So Cal real estate boomed in the 80's, yet the people kept coming.

Yeah, California housing prices did start to get higher during the mid '70s but ... not that high. The out migration really started with the recession of the early '90s which ...

Not coincidentally, was when housing prices really started to take off far above the national median ... as this chart shows.

http://www.mybudget360.com/wp-conten...5_medianus.gif

Since the '90s ... California housing prices have never really gotten back to anything resembling the rest of the country.

So all of those other things could play into it but ... the bottom line is still housing prices.