article saying that SF Bay Area needs DENSE HOUSING (Oakland: for rent, home)

[bodyforlife99]

Originally Posted by Perma Bear

I could care less about rent. The housing values are what I'm keeping an eye on, especially in the east bay which takes bubbles way worse than the peninsula you seek to be focusing on

Dude, how many times do I have to repeat myself to you?

Originally Posted by Perma Bear

It's only expensive until the next bust happens. The thing is people assume all bubbles last forever.

They really don't. But I think most people also don't try and time the market because that seldom works. I heard that term "bubble" two years ago and people saying it was a bad time to buy. So if next year we go into a recession and over the next two years, housing tanks by 20%, what did that person gain? Answer...nothing. The case shiller index has SF up 10.5% over the last 12 months. When you add the previous year and this year, it will be well above 20%. So waiting did that person no good. Add to that, this is one of the cleanest home buyer cycles in the last 20 years

-1/3rd have been bought with cash. I have no idea why people always claim this would result in some sort of distressed inventory. It will do nothing of the sort. It actually works against the "bubble" argument.

-Buyers of 2010-2014 have equity protection

-Cash Flow of these buyers get better each year since most have fixed debt payments with rates of 3.25%- 4.25%

It's the exact opposite from the housing bubble years. Even semi exotic debt are structured in a way where you still need to have the income capacity to own the debt.

Sorry it's not like the buyers in the East Bay don't include the same group of quality buyers. Again, what is your basis for implying the next recession would be anything like 2008? It's clear there will be less distressed properties and higher quality buyers (they're not exactly allowing stated income loans any more). More equity and lower fixed interest rates.

[ssmaster]

Originally Posted by bodyforlife99

Which posters are these? And you think there are a lot of people in the Bay Area like this, huh? Would that be the same group of people that posters here feel don't want to expand housing because "they got theirs", lol. I gotta tell ya. I don't know anyone that cares if someone buys a home (more power to them...I'll applaud them). My neighbor moved away a couple of years ago. I can assure you, we didn't get together and plan a scenario so that someone couldn't buy his house. In fact, the only thing he said was all things being equal (i.e. similar offers on his house), he would try to find the nicest family possible (and he did a good job...I love our new neighbors).

I'm also humored by the typical intolerance in your statement (yes, let's make anyone that doesn't agree with your viewpoint "powerless").

Did it ever occur to you that some people think the viewpoint that all you have to do is expand upward and build 5-6 story buildings, skyscrapers, etc,. is going to be pretty useless in the long run and simply overpopulate the city and turn it into a New York type environment? And I happen to think it's clear that the reason it hasn't happened is people like you are in the minority in your thinking (how can I not think that since this isn't the first time it's been talked about and it's never gained any steam).

I always find it funny how people will post some article they've found somewhere of some guy with some blueprint of all the big buildings they'll be putting into the city and how it's going to solve all the "problems". Of course, the one thing that is always missing is how they'll either take down the economy or how they will stop people from coming into one of the most desirable cities in the country (pretty much the only way I could see rentals and housing prices coming down).

There are currently over 850,000 people that live in San Francisco. From 2000 through 2009, the population increased by 52,000 people. In just the first 5 years of this decade, the population has increased by 48K (so nearly matched the entire last decade). Not only will you not be able to meet demand at this pace, but the only thing that would happen is people from outlying areas would just flock to the city and buy or rent all the new units. People would then inhabit the outlying area and new people coming to the area would once again drive up prices (seems pretty logical to me).

In addition, most of my friends who are homeowners, and have relocated (something my wife and I are thinking of doing) don't even sell their home. They rent them out. And pretty much all of them aren't the least bit concerned about some drastic reduction of rents or mortgages (none of us think it could happen for any real duration and we'll all be getting cash flow regardless).

I hardly think the next recession will be quite normal since this is one of the cleanest home buyer cycles in the last 20 years

-1/3rd have been bought with cash. I have no idea why people always claim this would result in some sort of distressed inventory. It will do nothing of the sort. It actually works against the "bubble" argument.

-Buyers of 2010-2014 have equity protection

-Cash Flow of these buyers get better each year since most have fixed debt payments with rates of 3.25%- 4.25%

It's the exact opposite from the housing bubble years. Even semi exotic debt are structured in a way where you still need to have the income capacity to own the debt.

You've already got 72% of available rental stock under rent control. What other artificial means could you manufacturer to bring prices down (and more importantly that you could get people to agree to?). You're never going to be able to stop income inequality (shy of full blown socialism). But many of you will continue to try anyway. And in the end, all you're doing is passing on the cost of things to the very Middle Class you claim you're trying to help.

this is correct
If you bought a house or refinanced a house between 2000 and 2008 you would acknowledge that the mortgage market is very different and that there is not the same risk of a huge housing correction

People were getting:

125% refinancing - house worth $500,000 ?great you can owe $625000 on it.

No doc loans- credit score >720 ? great just tell us how much you make we won't confirm it

Zero down sub prime loans
Adjustable rate no doc loans -
Zero down adjustable no doc loans

I knew people who owned 4-5 homes when honestly they could not pay for one of the homes.

Underwriting is very tight now the people who buy homes in the Bay Area have to have significant down payment and income

[hsw]

Let's flip argument around...

What % of engineers/salesguys@GOOGL, AAPL, etc actually "need" to be physically based in CA?

What is per capita operating profit of GOOGL, AAPL, etc today vs 3-5yrs ago?

If those cos.' stock prices don't work, those CEOs/founders (think MSFT) are forced out and are forced to change: think Gates/Ballmer, ashamed&effectively fired by some tiny activist fund from SF...even though Billy's net worth dwarfs anyones' in CA today

Prices solve much, whether in stocks or wages or house prices, etc

People vote w/feet...whether engineers or investors or alleged worker bees or parasites...

Always amused by commie arguments abt what stuff "should" cost or what housing people should have or how people should commute or how many kids they should have or quotas on % of whatever should live/work wherever or what's "fair" or blah-blah, all from folks who have never made any real money in their lives...Soviet claims of 30+yrs ago still live on in places like NYC/SF/DC/EU esp among gvt/nonprofit "workers"

[Perma Bear]

shareholders could get a good dividend if bay area tech companies sold their real estate.

[neutrino78x]

Originally Posted by hsw

Let's flip argument around...

What % of engineers/salesguys@GOOGL, AAPL, etc actually "need" to be physically based in CA?

Most of them. It's Silicon Valley. It is not as if they don't know how to telecommute. Many do. I can't imagine that anyone commutes physically to Google or Apple if they can do their job remotely.

If those cos.' stock prices don't work, those CEOs/founders (think MSFT) are forced out and are forced to change: think Gates/Ballmer, ashamed&effectively fired by some tiny activist fund from SF...even though Billy's net worth dwarfs anyones' in CA today

Gates isn't shamed at all. He left Microsoft voluntarily. He wanted to focus on charity. His net worth dwarfs pretty much everyone; he's the wealthiest man in the world. Microsoft is very profitable.

Always amused by commie arguments abt what stuff "should" cost or what housing people should have or how people should commute or how many kids they should have or quotas on % of whatever should live/work wherever or what's "fair" or blah-blah, all from folks who have never made any real money in their lives...Soviet claims of 30+yrs ago still live on in places like NYC/SF/DC/EU esp among gvt/nonprofit "workers"

I'm against communism but some things are bad and need to be discouraged. Smoking, internal combustion engines, fossil fuel power plants...and more to the point of this thread...single family homes. It's wasteful to commit all those resources and devote that land to the use of one family. You can take the same land area and house three or four families, if you build in the vertical dimension.

Each of these cities only has X amount of land. You can only put Y number of SFHs in X amount of land. It's not going to be enough to house a million people in a small amount of land. At some point you MUST start building more densely. Even without a statute requiring it, just the laws of economics would force you to build denser residential buildings.

I don't see what's wrong with owning a condo rather than a SFH or renting rather than owning. You make X amount of money and you can spend X/3 on your housing, and whatever you can afford on that budget is middle class housing if your income is approximately at the median (100k, around here). So that basically means apartments and small condos are middle class around here.

[SFBayBoomer]

Originally Posted by Perma Bear

Places like RWC and San Carlos don't need skyscrapers sticking up like a stick in mud. It's an eyesore. Build that high density housing in Oakland and the East Bay where there is no history.

There is plenty of history in Oakland and the rest of the East Bay, and we don't want high density here, either.

[neutrino78x]

Originally Posted by SFBayBoomer

There is plenty of history in Oakland and the rest of the East Bay, and we don't want high density here, either.

Many of us want it in Silicon Valley. You can always move to Texas or Arizona where it isn't dense at all.

[abqcd]

Originally Posted by neutrino78x

I would support a ban on new single family homes in SF and SJ. As the existing SFHs slowly fall apart and are ready to be replaced with new buildings, the law should say that the new building has to house at least three families; three units arranged vertically in the same condo.

How come you SF types only think in terms of bans, controls and more government regulation? That is precisely what is preventing developers from building more dense housing today. You don't need a law to achieve what you are asking for. All you need to do is remove the NIMBY regulations that prevent free market developers from buying old property and building taller structures. It's really that simple.

[neutrino78x]

Originally Posted by abqcd

All you need to do is remove the NIMBY regulations that prevent free market developers from buying old property and building taller structures. It's really that simple.

Dude the nimby's are the ones who don't want density. I'm the guy arguing in favor of it. I support developers tearing down old buildings and replacing them, as long as they are replacing it with a condo that would house at least three families.

[jade408]

Why would we tear down existing buildings?