I predict the number of schools in the Bay Area will decline greatly but their quality may improve (Oakland: new house, neighborhoods)

[WanderingFar]

Originally Posted by Perma Bear

"Baby Bust" As Calif. Birth Rate Declines | NBC Bay Area
My prediction coming to fruits too

Dude, this article is from 2013! It's since rebounded.

[Perma Bear]

Originally Posted by WanderingFar

Dude, this article is from 2013! It's since rebounded.

Not much

[WanderingFar]

Originally Posted by Ruth4Truth

I don't see your prediction happening in Fremont. Those immigrant techies work their way from renting into buying, and they want/support good public schools for the next generation of techies in the family. They're not going to pay for private schools as they don't have that financial leeway. Furthermore, the opposite of what you predict could happen; as more wealth moves in, it could make the need for private schools in the area obsolete, as a rising tax base makes more money available to public schools, and parents get involved, like the parents in Orinda. Your whole premise is based on your assumption that rich people avoid public schools, but that hasn't been true in areas like Montclair, Claremont and Upper Rockridge.

Fremont is one of the districts where schools are bursting. They're building all those new houses in Ardenwood and none of the nearby elementary want those kids.

[Perma Bear]

Originally Posted by WanderingFar

Fremont is one of the districts where schools are bursting. They're building all those new houses in Ardenwood and none of the nearby elementary want those kids.

For a cheap price of 1 million dollars for a row house that would be 150k everywhere else

[Ruth4Truth]

Originally Posted by Perma Bear

They can't buy though unless the whole family goes in on it. Less kids being born mean less need for more schools. My whole premise is less kids = less schools

As far as I'm aware, people are having 2 kids, a replacement rate. There may be an increase in childless couples among American-born, but that could be offset by a slightly higher birthrate in immigrant families, which figure significantly in the Bay Area demographic. I don't know precisely how all that balances out, but there's no way to know, really, until we get there, 20-25 years from now.

[jade408]

Originally Posted by WanderingFar

Unless you're working for a company that's ALREADY public. In which case, it's simple vesting math.

But anyway. Here's where you and Perma Bear are at cross-purposes.

1) He says the market will keep appreciating another 75% over the next decade. Driven by what? He doesn't say, but presumably strength of our economy.

2) You're pointing to the IPO market drying up. If the IPO market dries up, are home prices going to continue their meteoric rise? Either our economy is strong (home prices go up) or it's a house of cards (market crash).

So Bay Area home prices are either sustainable (supported by local incomes -- no problem to see here!) ... or they're not and will ultimately self-correct (more people can afford houses). Neither scenario supports his hypothesis.

Finally, he fails to address the fact that home prices and birth rates are actually CORRELATED because people are more likely to have kids when they feel secure about their jobs.

I don't think things are going to tank hard. But I do think it is ridiculous to bank on the IPO market fueling incomes enough to support lots of people buying. I think fairly well paid workers will leave once they have children. I have seen it happen already. People are taking small pay cuts and moving to cheaper metro areas where middle and upper middle class families can find decent housing and schools in their budget.

I think we will have a lot more Palo Altos. Expensive area where either legacy people or super affluent people live.

[Perma Bear]

Originally Posted by jade408

I don't think things are going to tank hard. But I do think it is ridiculous to bank on the IPO market fueling incomes enough to support lots of people buying. I think fairly well paid workers will leave once they have children. I have seen it happen already. People are taking small pay cuts and moving to cheaper metro areas where middle and upper middle class families can find decent housing and schools in their budget.

I think we will have a lot more Palo Altos. Expensive area where either legacy people or super affluent people live.

Looks like my "legacy middle class" term caught on, the funny thing is there are plumbers and their children who live in Palo Alto because it used to be middle class.

[justinbro2002]

This theory is predicated on the premise that all people wait to have children until they are financially well off enough to support them. If that were the case childbirth rates would already be much lower than they are now. But people don't wait and the population continues to grow.

[Perma Bear]

Originally Posted by justinbro2002

This theory is predicated on the premise that all people wait to have children until they are financially well off enough to support them. If that were the case childbirth rates would already be much lower than they are now. But people don't wait and the population continues to grow.

Most the yuppies who move to the Bay Area who think they'll be the next Steve jobs, while stupid, are still smart enough to realize they're too poor to have kids.

[plot]

Originally Posted by Perma Bear

Yeah okay I call bs on that stat unless you're talking about a mobile home . A new house was 10k in 1955.

I am talking about a house 1.3k sqft.

I know in the 1990s you can get a new house for 40k in the Dallas area.

Oakland in the 1980s you can get a 30 year old house for 80k. In the 1990s that same house is 120k+.

It is not a California 60k house vs 40k Texas house in the 1980s.

A 25 year old millennial with 100 grand in net worth for instance is in the top 10% of millennials. You're vastly overestimating their net worth. If even someone who's in the top 10% can't afford a home that's a very dangerous sign.

Ummm so if someone who earns minimum wage managed to get 100k from inheritance you think that person should get a house? I am not sure if my math is wrong but I am pretty sure you need to be making a healthy amount in order to quality for a loan. Plus 25 is a very young age to be considering a home.

A 25 year old millennial who is earning 100k could probably get a 600k house if they put 100k down. But I do not think most millennials would do that.