The San Francisco housing cycle will be more difficult to predict

[calicoastal]

Real estate is seasonal. There is always a slowdown in the fall and winter, which is why you look at year over year prices, not month to month.

[mlambert890]

The stats show that *Chinese buyers alone* are 20-30%. That's not even all "foreign money". That's *just* Chinese nationals.

Sort of ridiculous to claim that's a "small part" of the issue when its fully a third (at least).

How many financial executive/doctor couples are there? And this all assumes you are married and a dual "high power" couple.

I can say that the tech companies *don't* pay that well. None of them. Unless you hit early stock option lotto, that quoted $280k figure for a DINK couple is what realistically applies to probably 80+% of tech workers. And again, thats assuming you're *married* and that your spouse is a fellow techie.

That's a pretty big assumption. A FAR more common "DINK" scenario is one six figure ish income plus one five. And these folks, the majority IMO, are screwed. Especially when a full 30% of homes are being targeted by Chinese nationals with seemingly infinite cash and a willingness to spend 20% over full ask to vacuum up yet another rental property.

I just came from NYC Metro and IMO this area is *far* worse. Manhattan is bad. But thats it. There are decent values *all over* NYC Metro outside of Manhattan (NEVER thought I'd say this!) I was *thrilled* to get a "dream job" and it has turned out to be a catastrophic financial mistake. I plan to just take it year by year until I can get back out of the Bay Area which *really* sucks when you have a young kid to worry about, but I dont see this area as remotely sustainable for anyone but multi-millionaires or those with multi-million dollar backing.

[BayAreaHillbilly]

Originally Posted by mlambert890

The stats show that *Chinese buyers alone* are 20-30%. That's not even all "foreign money". That's *just* Chinese nationals.

Sort of ridiculous to claim that's a "small part" of the issue when its fully a third (at least).

How many financial executive/doctor couples are there? And this all assumes you are married and a dual "high power" couple.

I can say that the tech companies *don't* pay that well. None of them. Unless you hit early stock option lotto, that quoted $280k figure for a DINK couple is what realistically applies to probably 80+% of tech workers. And again, thats assuming you're *married* and that your spouse is a fellow techie.

That's a pretty big assumption. A FAR more common "DINK" scenario is one six figure ish income plus one five. And these folks, the majority IMO, are screwed. Especially when a full 30% of homes are being targeted by Chinese nationals with seemingly infinite cash and a willingness to spend 20% over full ask to vacuum up yet another rental property.

I just came from NYC Metro and IMO this area is *far* worse. Manhattan is bad. But thats it. There are decent values *all over* NYC Metro outside of Manhattan (NEVER thought I'd say this!) I was *thrilled* to get a "dream job" and it has turned out to be a catastrophic financial mistake. I plan to just take it year by year until I can get back out of the Bay Area which *really* sucks when you have a young kid to worry about, but I dont see this area as remotely sustainable for anyone but multi-millionaires or those with multi-million dollar backing.

I was poking around on Trulia looking at places in Rockland County. Nothing in the immediate future but unless we hit a windfall we're out of here for retirement. Earlier if our cash flow situation falls below a certain level. Mind you we are in good shape mortgage wise, this is not a situation of being unable to pay bills. However we've ended up putting a lot of money into housing over the years that would have been in retirement if we lived somewhere cheaper. Final fact - I'm a Bay Area native.

Wow, a Bay Area native thinking about NYC burbs for retirement! Crazy times.

[Chuck5000]

Just flat wrong: "not that many" people here earning big money. Read this thread: Tech Jobs Over 200K Or, go to Glassdoor and take a look. Google certainly pays well, the very big ones do. Enough for an ordinary 150k engineer? ONly if they rise, and only a few do. But that "few" adds up. Plus, BD, VP's of this and that, etc. Enough tech companies have enough highly paid senior managers, plus older founders and investors to make up a population with significant financial equity. They buy real estate.

So at any given moment, there are dozens of couples or individuals with an income well over 300k, 400k, 500k, looking for a home. Seriously. My ex boss just bought a $6m home. I'd personally like to see restrictions on foreign real estate investment, and in a place like Palo Alto it would make a difference (not that I'd be able to afford it anyway) but as for the whole Bay Area? Not much.

100,000 paying new jobs in San Francisco - story in the Chronicle this past week.

[BayAreaHillbilly]

Originally Posted by Chuck5000

Just flat wrong: "not that many" people here earning big money. Read this thread: Tech Jobs Over 200K Or, go to Glassdoor and take a look. Google certainly pays well, the very big ones do. Enough for an ordinary 150k engineer? ONly if they rise, and only a few do. But that "few" adds up. Plus, BD, VP's of this and that, etc. Enough tech companies have enough highly paid senior managers, plus older founders and investors to make up a population with significant financial equity. They buy real estate.

So at any given moment, there are dozens of couples or individuals with an income well over 300k, 400k, 500k, looking for a home. Seriously. My ex boss just bought a $6m home. I'd personally like to see restrictions on foreign real estate investment, and in a place like Palo Alto it would make a difference (not that I'd be able to afford it anyway) but as for the whole Bay Area? Not much.

100,000 paying new jobs in San Francisco - story in the Chronicle this past week.

Case study. On the road the Hillbilly Shack is on, at the time we moved in 20 years ago (market timing), we were moving into an area where it was mainly solid middle class. Generationally, the GIs who'd been the initial boom were selling out or passing away. Main population was boomers and a few silents mixed in, with a very small number of us Xers showing up. Even at that time, in that down market, most of the younger crowd were not even thinking about our area, they were going straight to the East Bay or North Bay. However, the existing folks: One neighbor was a Pac Bell line man / shop keeper couple, another was a couple who ran a mom and pop construction firm, another was a retired bar owner, a teacher, a clerical FiDi commuter, etc, etc. No VPs, no Dot Communists, none of that. Talk about a wild contrast between existing long time residents and newbs. So even then, the entry barrier was rising quite steeply. We really lucked out and did something similar to what Ultrarunner described on that other thread (although granted this was not Oakland, Deep East).

Now? GIs are almost all gone, silents nearly gone, boomers on their way out. Mainly Xers with millies moving in. All newbs are minimally millionaires and some very multi. Last few purchases were cash. Combo of FB / Twitter / Zynga / etc IPO windfalls and people who gambled and won at lesser known places. Even people like VPs at the more traditional BofA / Genentec / HP / Apple / Gap etc cannot afford it here, they are all going East to LaMOrinda / 680 corridor / etc.

[mysticaltyger]

Originally Posted by TR95

No slowdown here in Berkeley, Albany or even the good areas of Oakland. Surprised the Peninsula has slowed down. Now that interest rates were held close to 0, this will likely continue for the next 4 months at least. When interest rates start to increase there will still be buyers and if it is anything like 2003, it was a frenzy with people looking to buy before rates rose too much.

When supply is constricted, the insanity never ends.

[WizardOfRadical]

San Jose is building like crazy, that is why average rent is now cheaper there than in Oakland.