Aside from property prices, property taxes and gas, is California that much more expensive than other states ? (San Jose: buying, tenant)

[aslowdodge]

Originally Posted by BobPhipps

I bought 26 years ago and I am saving thousands by only paying the property taxes and no state taxes. The home we purchased was 1/4 of the current net worth of our CA home (and was only $35k more than our original purchase price in 1994). And needless to say, it's gorgeous compared to the CA home. The property tax is roughly $2500 more than the CA home. I don't have my tax return in front of me but I recall paying between $7k-$8k in CA taxes (so a savings of $4500 to $5500). And clearly if someone was paying current market value in a major metropolitan area of CA, the savings would be astronomical.

Again this is reality. Some Californians like to skew the actual reality of what the taxes will be by inferring two equal houses will be the same purchase price in both states when in fact the Texas house will be 1/4 the price. In the case of the poster you are responding to they are trying to tell how much more Texas costs by comparing what they paid for a house in California 20 years ago compared to Texas today.
Makes little sense except for trying to skew the facts.

[roadwarrior101]

Originally Posted by tetka_grunya

I don't think housing cost is much lower or just lower in Santa Clara County or Contra Costa.

I wasn't talking about the East Bay, but real inland areas, like the Central Valley, Sierra Foothills and Deserts.

[BobPhipps]

Originally Posted by aslowdodge

Again this is reality. Some Californians like to skew the actual reality of what the taxes will be by inferring two equal houses will be the same purchase price in both states when in fact the Texas house will be 1/4 the price. In the case of the poster you are responding to they are trying to tell how much more Texas costs by comparing what they paid for a house in California 20 years ago compared to Texas today.
Makes little sense except for trying to skew the facts.

Not to mention you'll often hear people only talk in percentages instead of comparing actual dollars. It should be rather obvious if I'm paying 2 1/2% to 3% of a $325k house that it's going to be less than 1% of a $1.3 million home.

[aslowdodge]

Originally Posted by BobPhipps

Not to mention you'll often hear people only talk in percentages instead of comparing actual dollars. It should be rather obvious if I'm paying 2 1/2% to 3% of a $325k house that it's going to be less than 1% of a $1.3 million home.

Exactly right. But some want to paint Texas in a negative light so they try to manipulate the actual numbers to prove their point.

[BobPhipps]

Originally Posted by aslowdodge

Exactly right. But some want to paint Texas in a negative light so they try to manipulate the actual numbers to prove their point.

To which I would say why? I'll never understand this cheerleading nonsense. Who cares? If you like where you live, that should be all that matters. Everyone has their own personal preferences. It's a matter of opinion. That doesn't mean one person's opinion means more than another's. With that said numbers are numbers. We made a move to better ourselves financially and we have a set of pros and cons that work for us (we really don't care about someone else's list and they shouldn't care about ours). I mentioned a few pages back, I don't know how anyone would compare states pulling out the biggest items from the list and I'll stand by that. Cost is a huge factor for most people and trying to pull that out of the equation is pretty silly.

[ohio_peasant]

Originally Posted by BGS91762

State tax rates in CA are higher than Texas (no taxes) but not compared to many states as the rates are graduated. For me, moving to TX would greatly increase my property taxes since I bought my house 20 years ago.

It varies. For a middle-income family that wants/needs a larger house in a good school district, property taxes may dominate. For a single child-free high-earner with a small footprint, who spends 90 hours/week working anyway, and who might split a small apartment with a girlfriend for a room-mate, state income taxes are going to dominate. In fact they might exceed the cumulative cost of housing.

We tend to assume that consumption increases with income. That's not always true. If income rises but consumption stays flat, then the taxes on income (wages, consulting fees, dividends and capital gains) may even come to exceed the totality of all of one's other expenses, including housing, healthcare, transportation, insurance, entertainment... everything.

States with a high marginal income tax rate are especially punitive to frugal, small-footprint high-earners, who try to save and investment every penny.

[DKM]

Originally Posted by BobPhipps

To which I would say why? I'll never understand this cheerleading nonsense. Who cares? If you like where you live, that should be all that matters. Everyone has their own personal preferences. It's a matter of opinion. That doesn't mean one person's opinion means more than another's. With that said numbers are numbers. We made a move to better ourselves financially and we have a set of pros and cons that work for us (we really don't care about someone else's list and they shouldn't care about ours). I mentioned a few pages back, I don't know how anyone would compare states pulling out the biggest items from the list and I'll stand by that. Cost is a huge factor for most people and trying to pull that out of the equation is pretty silly.

But his/her numbers are not correct. When I compared houses in the part of Texas we would live to here, it wasn't even close to 1/4th the cost. For me, the taxes (property and income) in Texas would be about 2k less than what I pay here. The house itself would have been nicer, but not the neighborhood or schools (or any number of other things). But that doesn't come close to the 15k lower salary I would have taken to live in Texas. As for the house, I fixed it up (which also was a source of pleasure for us in a weird way). So to me its not an opinion: I make and keep more after tax money by living here. That isn't going to be the case for many people I imagine. And it doesn't begin to approach the lifestyle difference. We took exploratory trips to Texas and here. Texas had some advantages to here, but not many.

[2sleepy]

Originally Posted by aslowdodge

Exactly right. But some want to paint Texas in a negative light so they try to manipulate the actual numbers to prove their point.

Many people don't want to live in Texas. I have spent a fair amount of time there and simply didn't like it. If I were looking for a tax refuge I would probably move to Mexico. With that said, I don't haunt the Texas forums telling people how stupid they are for living in Texas.

[BobPhipps]

Originally Posted by DKM

But his/her numbers are not correct.

Actually, they're absolutely correct. I know what I paid for my house and what I saved. If it didn't work out for you for a specific area, so be it. Looking at median home prices and proximity to metropolitan areas, most people should find better savings outside of CA. But if a person doesn't like a place for a myriad of reasons, they shouldn't move there. Same goes for the type of house. As they say in real estate.... location, location, location. You have to like where you live (and of course be able to afford it). My wife and I took a 30% haircut on wages and are doing much better financially (it also doesn't hurt that we're getting cash flow from our house in the Bay Area which we decided to rent instead of sell). This isn't about cheerleading or bashing. Unfortunately, so many people want to make it about that.

[CA4Now]

Originally Posted by 2sleepy

Many people don't want to live in Texas...With that said, I don't haunt the Texas forums telling people how stupid they are for living in Texas.

Good point.