Is the housing in CA as bad as we hear? (Fresno: for sale, real estate)

[Ownahome]

Is it true that house prices are outrageous in California and people are not able to sell or buy?

[SouthBayTodd]

Yes. Here is a modest 4 bedroom home for sale in the city I live...

http://www.southbaychat.com/hermosa-...rmosa-ave.html

[Need_affordable_home]

I said OMG before I even saw the price! Wow who has 2.8 million? That house isnt even very big and the lot is tiny! Its one block from the ocean but still.

Not many houses are selling, almost no one can afford even a starter house. Lots of people leaving CA, others that decide to stay are stuck renting apartments. Many will rent for the rest of their lives, others will leave when they retire and finally own the american dream.

[SouthBayTodd]

the area i live has some of the most expensive real estate in the country (world?) here is an example of what it costs to live on the beach (small lot)

http://www.southbaychat.com/manhatta...16-strand.html

[Tallysmom]

Originally Posted by Ownahome

Is it true that house prices are outrageous in California and people are not able to sell or buy?

Houses are expensive, but they are still selling. According to Data Quick, prices have fallen in some zip codes, but risen in others, keeping our median home price pretty stable -- with just a teensy bit of a gain.

But the market is not very active -- like most of the US. If the house is in a desirable area and is in great condition and is priced well and shows well, it sells.

I'm a janitor at a condo complex and for the longest time there was no realty activity at all -- about a month ago or 6 weeks ago, I started seeing buyers coming with Realtors. Still nothings moved... but I consider that a good sign.

The long and short of it is, if you want a house, you can buy a house, but our homes are expensive. I think we are the fourth most expensive housing market in the US.

[SouthBayTodd]

here's the thing about california: if you are buying in an urban or coastal area - your real estate will appreciate long term. you do need the money to buy in the first place in CA, but if you can afford it, you'll be in good shape. some areas of CA have totally inflated real estate values (Fresno?) though

[gizmo980]

Originally Posted by Need_affordable_home

I said OMG before I even saw the price! Wow who has 2.8 million?

Around here, lots of people do. My mother's house is on the market right now, slightly under that range, and she's had lots of interest so far... her neighbor's home sold last week, for about $2.5 million - so yes, they're still outrageously expensive, but people are buying them anyway!

Oh, and my friend & her husband recently bought a small-ish 3-bedroom home, for just over $900K... and they're no millionaires (I think combined income is around $120K), but were able to get an interest-only kind of deal. I don't know much about real estate, but I assume you'll know what that means.

[gizmo980]

Originally Posted by SouthBayTodd

here's the thing about california: if you are buying in an urban or coastal area - your real estate will appreciate long term. you do need the money to buy in the first place in CA, but if you can afford it, you'll be in good shape. some areas of CA have totally inflated real estate values (Fresno?) though

Yup, that's very true. My mother's house, which I just mentioned, was purchased for less than half of what she's asking - and she bought it only 8 years ago. Our family home (where I grew up) almost quadrupled in value, from 1983-1997... and my sister's place has increased from $550K-$750K in just 3 years. So yeah, you're in good shape once that first home is purchased! I plan to buy something in the near future, and will probably start with a small townhouse/condo & trade up from there.

[Need_affordable_home]

Originally Posted by gizmo980

Around here, lots of people do. My mother's house is on the market right now, slightly under that range, and she's had lots of interest so far... her neighbor's home sold last week, for about $2.5 million - so yes, they're still outrageously expensive, but people are buying them anyway!

Oh, and my friend & her husband recently bought a small-ish 3-bedroom home, for just over $900K... and they're no millionaires (I think combined income is around $120K), but were able to get an interest-only kind of deal. I don't know much about real estate, but I assume you'll know what that means.

Wow do those people take out creative financing? Youd need to be rich to buy a $2.5m house even on creative financing and you can kiss it bye bye when it gets foreclosed. The banks will be stuck with a house no one can afford and the cycle countinues. A $900k house is 7.5x the $120k combined income. This is almost 3 times more house than what they should spend on. A $900k fixed 30 year comes out to 5,688 a month or $68256 a year. Then theres other expenses like property taxes, insurance and HOA thatll add easily another $30k a year. They wont have money to buy food! With creative financing, they are living paycheck to paycheck and may end up foreclosed in a couple years unless their house somehow goes up in value quickly and can sell it to get their money back!

I would not buy a $900k house unless I was making at least $250k a year and I had at least a million in funds to pay the expenses. I would have to win about 20 million in the lottery then ill end up with about 6.7m after lump sum and taxes, give my family some money and keep like 5 to 6 million for myself and ill probably feel more comfortable spending $250k to $500k on a house while putting the rest of my 5 million into funds which appreciate much better than real estate(the bubble is over) and when I have like 15 million in funds then ill buy a million dollar mansion.

[JakeDog]

"I would not buy a $900k house unless I was making at least $250k a year and I had at least a million in funds to pay the expenses"

You are being silly. The tax write off is what makes buying a home so attractive. $900K is essentially the minimum for a family home in a decent area of the bay area (ducks head knowing many people in less desirable parts of the bay area will be offended). In part of the south bay you need 1.5 millon just to get something livable. How do people do it? There are a lot of high income and rich people in the Bay Area, and there are others that take out interest only mortgages (bad idea).