Where do Austinites fed up with Austin move? (San Diego, Howe: sale, rental)

[10scoachrick]

Originally Posted by Shredding_Gnar78

i already touched on this years ago

//www.city-data.com/forum/austi...ve-if-you.html

Different discussion now...people are able to cash out at the peak of the market...unlike four years ago. Also, the taxes weren't as high since the values weren't where they are now.

It's interesting to consider a move...and interesting to view the possible change now vs the time period of your thread.

[scm53]

Anyone who wants to make the case about suburban SD not being considerably more expensive than suburban Austin needs look no further than this example from my old neighborhood of Bonita. 4/2, 1900 sq. ft, built in 1970, dated everything - kitchen, baths, all of it. $525K. To most destinations south of I 8 will be a thirty minute commute. Now draw a thirty minute circle around downtown Austin and see what you get for $525K. It won't be that.

[Aquitaine]

I lived in SD for 7 years and owned and rented there. I agree with you on the CA state income tax making Austin more affordable than SD

I may not be putting this correctly as that's two posts where you're citing differences in opinion. I don't have an opinion about SD housing costs. You do, because you lived there. That's fine. But your anecdotal feeling about it is not a basis for conclusion.

We have several indexes we use to measure cost of living or house costs. City-data has one; there are other COL sites out there too. The Case-Shiller index is a good one just for housing costs, and San Diego is one of the cities they measure. Looks like San Diego rated a 203 in October 2014. Austin doesn't seem to be on the list or accessible, but Dallas was 142.75; I would expect Austin to be higher than that but lower than San Diego based on other COL indicies.

It isn't that your experience isn't valuable; it's that you can't capture enough data in seven or seventy years of living somewhere to accurately represent "what is the cost of housing" based on your own experience. This statement may well be true:

The Austin core is more expensive than the cheap areas of San Diego

So what? That doesn't make San Diego cheaper than Austin; it makes the most expensive Austin Real estate more valuable than the cheapest San Diego real estate. I am not sure how that is a meaningful distinction. Who ever decides, "shall I live in a shack in San Diego or a luxury condo on 5th street in Austin?"

Austin's central core is more expensive than some pretty terrible parts of Brooklyn, but that doesn't mean Brooklyn housing is more affordable than Austin.

[Frodo2008]

Originally Posted by tom331

Other than house, COL in San Diego and Seattle is not that much higher than Austin. The saving from paying less property tax is more than enough to offset the higher cost of living. Plus, the nice weather is a huge bonus. There is no state income tax in Washington state either. The property tax is about 1.1% in Seattle area.

OK but the house is everybody's biggest expense though. Once you throw in the house the COL will be a lot higher, right? I know Austin is expensive in TX but my impression has always been that any place in TX is a lot cheaper than places on the west coast or in the northeast. Is my impression wrong? Is the COL on the west coast exaggerated?

[tom331]

Originally Posted by Frodo2008

OK but the house is everybody's biggest expense though. Once you throw in the house the COL will be a lot higher, right? I know Austin is expensive in TX but my impression has always been that any place in TX is a lot cheaper than places on the west coast or in the northeast. Is my impression wrong? Is the COL on the west coast exaggerated?

Yes, the COL in west coast especially in San Diego and Seattle is exaggerated.

I have visited these two cities several times in last couple years. I was specifically checking to the Real Estate for our future retirement. I checked some condo at Downtown San Diego with nice bay view. The average price is about $500 per square foot. Those condo were built between 1998 to 2007. For the similar quality and style condo at downtown Austin, the price is about 10% lower. If I purchase a condo for $500K at San Diego, my annual property tax will be about $6,000, but for a $450K condo in downtown Austin, I need to pay $11,000 property tax per year. For someone looking for a place to retire, the low property tax and sunny 70 plus degree weather definitely is very attractive. But, my comparison is specifically to the properties at Downtown San Diego and Downtown Austin. For the area other than downtown, San Diego housing price would be 30 to 40 % higher than Austin.

The housing price in Seattle is about 25% higher than Austin in general. My sister just moved to Seattle from South California. She like the Sound view and mountain in Seattle. She paid $900K for the house with great water and mountain view. For the similar house at Austin without any view, it could cost about $600K. For this number, the price is 50% higher, but my sister's house is right on the water with gorgeous views. She has to pay addition premium for the view. Her property tax is about $10,000 a year vs $15,000 property tax for a $600K house in Austin.

For people consider a retirement place, you don't need to rule out the west coast. It might not be as bad as you think. However, it might not work for younger generation because the job is most important at their age.

[scm53]

Originally Posted by Frodo2008

OK but the house is everybody's biggest expense though. Once you throw in the house the COL will be a lot higher, right? I know Austin is expensive in TX but my impression has always been that any place in TX is a lot cheaper than places on the west coast or in the northeast. Is my impression wrong? Is the COL on the west coast exaggerated?

I've lived both places. My kids have lived VERY recently in both places. Here's my take (like for like):

What is more expensive in Cali

Housing
Gas
Car Insurance
Income taxes

What is less expensive

Food
Clothing (really, only one season's req)
Utilities (for a comparable sized living space)

Now we get to property taxes. The "1%" is a myth. Bonded debt can add on about .15 or so. If you live in a Mello-Roos area, you can get another up to .1. So you may be paying 1.25% or so in many places. The hard part is comparing the taxable values to apply whatever rate to. Like the house in Bonita I pointed to, like for like is at least 30% higher (YMMV) there. So, you are paying a lower rate on a more expensive house - which may mean the real delta isn't all that great - especially when the higher house payment is added back in.

[scm53]

Originally Posted by tom331

If I purchase a condo for $500K at San Diego, my annual property tax will be about $6,000, but for a $450K condo in downtown Austin, I need to pay $11,000 property tax per year.

Add back in potential California state income tax to that number to get a valid comparison. For instance, married filing jointly on $100K is $4500. Suddenly, the delta is only $500/yr.

And as you point out, those are extremely small slivers of the markets in both places. Exactly what market you are in, so very valid for your situation. Just not broadly applicable.

[TR95]

Originally Posted by tom331

Yes, the COL in west coast especially in San Diego and Seattle is exaggerated.

I have visited these two cities several times in last couple years. I was specifically checking to the Real Estate for our future retirement. I checked some condo at Downtown San Diego with nice bay view. The average price is about $500 per square foot. Those condo were built between 1998 to 2007. For the similar quality and style condo at downtown Austin, the price is about 10% lower. If I purchase a condo for $500K at San Diego, my annual property tax will be about $6,000, but for a $450K condo in downtown Austin, I need to pay $11,000 property tax per year. For someone looking for a place to retire, the low property tax and sunny 70 plus degree weather definitely is very attractive. But, my comparison is specifically to the properties at Downtown San Diego and Downtown Austin. For the area other than downtown, San Diego housing price would be 30 to 40 % higher than Austin.

The housing price in Seattle is about 25% higher than Austin in general. My sister just moved to Seattle from South California. She like the Sound view and mountain in Seattle. She paid $900K for the house with great water and mountain view. For the similar house at Austin without any view, it could cost about $600K. For this number, the price is 50% higher, but my sister's house is right on the water with gorgeous views. She has to pay addition premium for the view. Her property tax is about $10,000 a year vs $15,000 property tax for a $600K house in Austin.

For people consider a retirement place, you don't need to rule out the west coast. It might not be as bad as you think. However, it might not work for younger generation because the job is most important at their age.

This is very true, but let's keep everyone believing that the West Coast is so much more expensive than Austin. And, think what happens when that $450k condo in Austin is $600k in 5 years and someone is paying close to $15k in property taxes while your $6,000 only goes up slightly. You can run thousands of calculations, but retiring in Ca can work out better financially than Austin, many areas in Dallas and Houston. You just can't pick Del Mar/La Jolla. Heck, you can even find many cheaper places in North County. Sure the places may be a little smaller, but you spend a lot more time outside than you would in Texas. Of course, it gets down to preference.

[tom331]

Originally Posted by scm53

Add back in potential California state income tax to that number to get a valid comparison. For instance, married filing jointly on $100K is $4500. Suddenly, the delta is only $500/yr.

And as you point out, those are extremely small slivers of the markets in both places. Exactly what market you are in, so very valid for your situation. Just not broadly applicable.

A retiree with $60K annual income might pay less than $4,000 state income tax in California, however, the lower property tax is about offset the state income tax. But, It is San Diego. A sunny 75 degree weather all year around. How much it worth? What I am trying to point out is that Austin downtown property price is highly inflated. By paying the downtown condo price, there are many other places at West Coast with much nicer weather. As I mentioned before, the option might not be available to most younger generation, but for someone ready or going to retire, don't let the state income tax scare you. If you don't want to pay California state income tax because your income is higher than most of retirees, you could keep a small condo at Texas. A Texas resident does not need to pay California Income Tax.

[thenewtexan]

Originally Posted by ctr88

I've read a lot of negative comments about how bad the traffic and housing prices (including property taxes) are in Austin (those seem to be the two main gripes - and they appear to be accurate gripes). I'm curious where Austin residents generally go if they move away from Austin? Are there cities they favorite to escape the housing costs and traffic?

Hill Country. Pick a town.