Odds of California real estate going down a lot (Orange: mortgage, houses)

[Fargobound]

Originally Posted by Howiester

lol this guy serious?

Well Sacramento does have a river that is useable and quick access to better skiing.

What does LA have to offer? traffic, dirty beaches and a few crummy amusement parks?

IMO SF, LA and NYC are places people try hard to BS themselves into thinking this is where it's at, that they made it.

[justinbro2002]

The housing correction of 2007-2009 brought prices down to 1999 to 2001 levels dropping 35% to 60%+ depending on the locations. The housing correcting of the late 90's and early 2000's (dot-com bubble) dropped home prices single digest %'s. The 2007-2009 correcting brought prices to 2001 to 2002 levels. That was an over correction we are now 15 years past those 2001 prices and the prices now are inline with a more tradition market appreciation over those 15 years perhaps 1.5%/year higher than the norm. Lenders now require that borrowers now be very qualified unlike the run up in the early to mid 2000's. If we see a correction any time soon it will be more than likely like the single digit drop of the early 2000's than the last drop.

[jade408]

Originally Posted by NewbieHere

I know on cyber, people like to exaggerate. I had a tenant who was CEO a couple of years ago with similar salary and he bought a house in 2013 with that exact salary. His wife didn't work and he bought a nice but not luxurious home. I'm sure today you can buy something but not in super expensive area.

That's the problem. At a $300k income you expect something pretty nice. At least if you lived in NYC you could get something very nice in CT or NJ. In the Bay Area you get a 1950s fixer-upper ranch, a long commute and average schools.

[jade408]

Originally Posted by pacific2

Maybe it would make more economic sense for Bay Area professionals to move to places like LA and OC. Housing is expensive down here, but it's nothing like what you are describing.

Some people are or Sac. Makes income inequality worse. And where do teachers live? They need to be local.

[honobob]

Originally Posted by Fargobound

This all day long. I was once offered a $90k job will fully paid benefits in San Jose and realized that I'd be working just to pay for housing.

Housing that would start to pay YOU tens of thousands a year! That's why people that make less than $100,000 a year can buy million dollar houses. They have hundreds of thousands of dollars in appreciation equity!

[SandyCo]

I always tell people that if they intend to live in their home for at least ten years, go for it. If they're short term and intend to move out sooner than that, they're rolling the dice. California's biggest cities have always seen this boom/bust cycle. The boom times are unsustainable long term, and I have a feeling the most recent housing market "recovery" wouldn't have happened if interest rates weren't so low. On the other hand, L.A. in particular has had a net population gain of 69,000, and they all have to live somewhere!

[Fargobound]

Originally Posted by honobob

Housing that would start to pay YOU tens of thousands a year! That's why people that make less than $100,000 a year can buy million dollar houses. They have hundreds of thousands of dollars in appreciation equity!

That train left the station decades ago and wages left on a slower train that's just idling along

[Des-Lab]

Originally Posted by Fargobound

I LOL-ed

SF is a **** and poop ridden dump. Yes I've been there and would never buy or rent a home there.

LA might as well be Sacramento with quick access to a beach.

NYC outside of pizza is over-rated. The only thing you do here is exist to pay rent.

It's only going to take one large earthquake to straighten out the real estate market in SF.

We're living in real estate bubble 3.0 and the denial is much stronger this time around. That's why I said this time it will be soul crushing when when it does pop.

Spoken just like every other angry, priced out disgruntled renter.

[expatCA]

Originally Posted by Des-Lab

Spoken just like every other angry, priced out disgruntled renter.

Humm, is he wrong though? OK, maybe about the earthquake he is wrong, as it ain't likely to happen and would just raise the values of the new "beach" localities if it did.

[pacific2]

Originally Posted by jade408

Some people are or Sac. Makes income inequality worse. And where do teachers live? They need to be local.

OC teachers live in just about every city here. Obviously, places like Laguna Beach and Newport Beach are pretty much beyond their budget.

Many are in two-income families, and that helps with housing affordability.