Is the housing in CA as bad as we hear?

[TheUtopian]

Originally Posted by Tallysmom

Well -- yeah -- lending standards will get tighter, till things get better and investors get greedy again and then standards will loosen up again.

We've been here before, in 1992-93 I believe. Lending was at an all time high, and that was the beginning of the 125% mortgages. The bust was pretty drastic -- some areas did see a steep decline in home values.

I personally knew a few people that paid a lot of money for homes that less than a years later were about 30% less. it was two years or so before they value was back up to the level of the mortgage they had.
Back when I was getting decent grades in Ecomony because I wore this cute little low cut halter top and sat in front -- there was one thing I took from it. Economies are not unlike rubber bands. You stretch and stretch, like the economy expands and expands, and then it SNAPS back... and the boom goes bust. But sooner or later that rubber band starts stretching again....

HAR!! I've read two of your posts now and either one of them mentions the continued outsourcing of high tech jobs. Back when your ''rubber band'' theory seem to bear out, we weren't moving towards a ''whole sector'' service economy at the pace we are now. I challenge you to look at the area of new job creation and come back here and tell us all how peachy everything looks - We're being sold out and most just dismiss it and go back to watching Greta Van Sustern and the adventures of Anna Nicole Smith every night. This country no longer produces anything of value ; we're made up of google-eyed types who wear bow ties and make money by manipulating other money.... and that's gonna one day come back to haunt all the folks with crappy 900k tract homes. I wish there was venue where I could lay some serious cash down that says -- California will experience a phenomenon known as ''reverse gentrification'' within the 12 to 20 years.

[TheUtopian]

The last time the housing market recovered in the BA, the tech industry saved the day. I'm not so sure that there is a safety net now.

You're on the money.

[Tallysmom]

Originally Posted by TheUtopian

HAR!! I've read two of your posts now and either one of them mentions the continued outsourcing of high tech jobs. Back when your ''rubber band'' theory seem to bear out, we weren't moving towards a ''whole sector'' service economy at the pace we are now. I challenge you to look at the area of new job creation and come back here and tell us all how peachy everything looks - We're being sold out and most just dismiss it and go back to watching Greta Van Sustern and the adventures of Anna Nicole Smith every night. This country no longer produces anything of value ; we're made up of google-eyed types who wear bow ties and make money by manipulating other money.... and that's gonna one day come back to haunt all the folks with crappy 900k tract homes. I wish there was venue where I could lay some serious cash down that says -- California will experience a phenomenon known as ''reverse gentrification'' within the 12 to 20 years.

I haven't mentioned it, because that's not what I was talking about. You have a valid point -- it's not just one thing that sinks or swims an economy. It's a multifaceted amalgam of smoke and mirrors. But still -- this is something that has been proven time and time and time again -- it's cyclical -- it expands and contracts, and expands and contracts... sometimes it expands really well and everyone is happy, making money hand over fist... and sometimes that contraction HURTS.... like the Great Depression.

But one thing I know for sure -- the guy standing on the corner wearing the sandwich board painted with "The End Is Nigh" isn't going to be the one that helps rebuild our economy should it really go bust.... it'll be on the backs of the small business owner, slowly building up what he knows best, hiring and helping those on the way.

[sliverbox]

But one thing I know for sure -- the guy standing on the corner wearing the sandwich board painted with "The End Is Nigh" isn't going to be the one that helps rebuild our economy should it really go bust.... it'll be on the backs of the small business owner, slowly building up what he knows best, hiring and helping those on the way.

I don't think anyone is here rubbing their hands together all giddy with excitement over a potentially cataclysmic crash. The reality is that this latest bubble was not only a housing bubble, but a liquidity bubble used as a temporary crutch to hold up the sagging economy without addressing the real causes of it's negative performance. Instead of money coming from industry, innovation, and productivity, it came out of the pockets of the American consumer in the form of massive amounts of debt. True- areas of the US such as SF, NYC, Dallas, and so on have had decades of ups and downs in their housing markets. But this time it was nation-wide.

What people are waiting for is not a terrible economic fallout, but a return to normalcy where a salary given for a decent job pays for life's basic amenities taken for granted in decades past.

There is a very real fear that the days where people could happily go off to work and come home to a comfy lazy boy in the living room of their paid for modest home are over and we're trending towards other old world countries where a home is inherited and there exists only 2 classes. For many, there is a huge desire to see the return of the American way of life.

[AK123]

Originally Posted by SouthBayTodd

Houston might be a nice place to live, I'm not saying it isn't. But saying it has "world-class culture" is more than a stretch.

A theatre district second in size only to NYC; Fabulous museums, both with local art and that attract overseas exhibits that often hit only a few U.S. cities. Most people have no idea. That's what I meant by the culture.

[Tallysmom]

Originally Posted by sliverbox

What people are waiting for is not a terrible economic fallout, but a return to normalcy where a salary given for a decent job pays for life's basic amenities taken for granted in decades past.

There is a very real fear that the days where people could happily go off to work and come home to a comfy lazy boy in the living room of their paid for modest home are over and we're trending towards other old world countries where a home is inherited and there exists only 2 classes. For many, there is a huge desire to see the return of the American way of life.

My hubby and I married in 1983 -- in Pittsburgh PA. Steel was in it's death throes. It took Pittsburgh, Youngstown, OH, Gary Indiana -- they don't call that the rust belt for nothing.

I've seen massive unemployment. I've seen those comfy lazy boy in the living room people have to scramble to put food on the table, and scramble even more to put a roof over that table. People who earned very good money, and then had to take 6 buck an hour job and then thank the guy who gave it to them.

I get it. I get it better than most people do.

But all you have to do it look at how so many of the rust belt places have fared in the ensuing years to understand that you can pine for the good old days all you want, that doesn't bring them back. Time marches forward and the adage is as it always was "adapt or die".

I started posting on the Pittsburgh board, because my history is strongly tied to that state (commonwealth). 9th generation Pennsylvanian. But when we figured out Pittsburgh was not going to recover like it had in the past, we left for California. And after 13 years in banking and banking security, with all the mergers and transferring and subsequent firings there, we saw the handwriting on the wall for banking. We started our own janitorial company. Thankfully, that's been very good to us.

[sliverbox]

What's Ironic is that You mention Pittsburgh in rust belt tense. Interestingly enough, I too am amoungst a generation of those who was out to "seek a better life" from an economically depressed area- the Southeast, which was classically well known as a mostly extractive economy based in coal, agriculture, and textiles. Just like Pittsburgh and it's decline in steel, so too did the Southeast suffer from the erosion of it's economic staples.

When I left, there were few if any options available for me in my field. So I- like yourself struck out for CA.

But as you mentioned in some of your previous posts, All things do not remain the same and neither do places or people. Interestingly enough, the Southeast is now one of the most rapidly developing regions in the country. North Carolina has it's tech triangle, which in turn has been deemed the Silicone Valley of the East ( Or South as I would like it to be referred) Former old cities that were once slow and depressed are being reinvigorated and look better than ever. The job market is robust with less than a 2% unemployment rate- the best in the country. Numerous publications have ranked many Southern cities in the top 10 for places to live and do business.

But not California... Instead CA- like your former state is losing massive amounts of people. They are going to places like Austin, Dallas, Atlanta, Raleigh, and believe it or not- Pittsburgh, which despite its past misfortunes in the steel industry has really started to come back in recent years as an important tech and research center. Unless California can wrangle in the cost off living, I see no reason why it might not someday become very similar in terms to those classic rust belt states. Regardless of the weather, business must be profitable. If CA loses the bright minds, talent, and business to other areas, then I see problems for the future.

So indeed- we dream about the place we can live comfortably and well within our means. California just happens to not be that place anymore and many will be seeking a means to an end, even if that means leaving it.

[Wiglet23]

I have lived in the Bay area for almost all of my adult life. I've been here since 1990. I am a public school teacher and my husband is an accountant. We have 4 kids. It is really expensive here, so we're moving. We need to be close to my parents - sandwich generation - and family. The Bay area is great, though. It works really well if you don't have kids. Both my husband and I did not have any family help to buy our first home, but we did it. It took a lot of sacrifice and we don't necessarily take advantage of all the area has to offer due to finances. I don't see my salary going up any time soon, so we are leaving. It's been a good 17 year run, but we've gotta' RUN OUTTA' HERE!

[Ultrarunner]

You did not say where you are going? Is it as nice or did you decide based on cost-of-living?

[whiskyd]

No its actually worse then you have heard. I sold my $300k 3 bedroom townhouse after 2 years for $520k ... that is a townhouse! I loved the bay area but couldn't afford it and had to leave.