Raising a family in Los Angeles on 100k/year. (Glendale: rent, crime)

[BRinSM]

You never mentioned specifically where you'll be working. Its very important in LA that you factor that into where you ultimately live. You have a healthy salary so you should have decent options. Don't get set on Downey unless the office will be relatively close by.

[nodeal]

Thanks so much for the advice guys.

Yes I was surprised to see houses under 500k selling in Downey. I am by no means set on Downey, it was just a suggestion thrown to me by a friend and I was checking it out. I wanted to hear some opinions on it, thanks so much for the information about Downey and its schools.

On a $500,000 mortgage I hope to put down 20% by the time I am ready to move.

I do not yet know the details of where in L.A. exactly my day-to-day business will take place. A lot is still up in the air, but I figured it would be great to first hear from people familiar with the area about how to set my expectations and making it in this city starting off with an income of 100k/year.

I will have to check out some of the areas mentioned more closely and keep searching around the area, especially as I get details on where exactly I will be working.

[CA4Now]

Originally Posted by JohnG72

I ran a search on Redfin for SFR sold under $500k during the past 3 months. Literally scattered throughout the city and all seemed to be in nice neighborhoods and in decent to great shape.

The company I work for has an office in Downey. Like any other city, there are areas to stay away from, information which doesn't always show up on a real estate listings site.

[thelopez2]

Originally Posted by majoun

Property taxes would be higher relative to the value of property, but property values would be considerably lower, so in the end there would be less of a tax burden. Especially considering that other taxes would be lower, and there would not be a deluge of fees and fines for every conceivable human activity. L.A. would still be affordable and would have more of a middle class.

Doubtful, if there is a deficit in tax revenue, the tax burden can not go down. Remove prop 13 and you basically are writing a blank check to a system which has shown consistenly the inability to work within a budget. If new people (transplants) buy into a neighborhood, have higher incomes or willing to spend more on housing, just because they want to, it'd raise the taxes on the person that bought a long time ago regardless of their income not increasing. That fixed income middle class person will be forced out of the neighborhood without the prop 13 protection.

It will not increase affordability. If a person is willing and capable of spending $2,500 a month for housing expense, $2000 mortgage and $500 property taxes, it won't change if ratio shift to $1500 mortgage and $1000 in property taxes, they are still willing to pay $2500 a month.

[Londonteacher]

You will be fine on this as long as you do not hAve big car payments...debts.
We pay 2600 in a gorgeous 1900 square foot rental near a number 10 school..beautiful and safe area.
Depending on where you work....if you can live north east.....la crescenta is fantastic school district and rentals start from 1700 for an apartment and 2000 for a modest 2 bed. Safe. Better air as close to mountains......100 k is plenty.if you live carefully.....houses from 485 k but fixer uppers....but near great schools.south Pasadena also great schools but houses harder to get...more apartments.glendale also has some good schools and is pleasant.

[Londonteacher]

LA will be cheap after new york.100k post tax.....you will have a perfectly nice life on that...if a modest home.

[majoun]

Originally Posted by thelopez2

Doubtful, if there is a deficit in tax revenue, the tax burden can not go down. Remove prop 13 and you basically are writing a blank check to a system which has shown consistenly the inability to work within a budget. If new people (transplants) buy into a neighborhood, have higher incomes or willing to spend more on housing, just because they want to, it'd raise the taxes on the person that bought a long time ago regardless of their income not increasing. That fixed income middle class person will be forced out of the neighborhood without the prop 13 protection.

It will not increase affordability. If a person is willing and capable of spending $2,500 a month for housing expense, $2000 mortgage and $500 property taxes, it won't change if ratio shift to $1500 mortgage and $1000 in property taxes, they are still willing to pay $2500 a month.

It would put a halt to the rapid appreciation of property values and virtually end real estate speculation. Without 13 there would not be real estate bubbles to the same extent that there are. In fact if 13 was repealed property values would probably tank.

[Ultrarunner]

Originally Posted by majoun

It would put a halt to the rapid appreciation of property values and virtually end real estate speculation. Without 13 there would not be real estate bubbles to the same extent that there are. In fact if 13 was repealed property values would probably tank.

There were plenty of bubbles around the country and only California has Prop 13.

Politicians don't want values to tank because when they do... it creates financial disaster on a large scale...

Zoning has more to do with propping up values... it creates exclusivity which can translate into demand...

50% appreciation over the last 30 to 36 months is not unusual in parts of California... people will look back at 2012 as a golden buy opportunity with low rates and depressed prices... often less than the cost to build so the land was actually free.

[majoun]

Originally Posted by Ultrarunner

There were plenty of bubbles around the country and only California has Prop 13.

Politicians don't want values to tank because when they do... it creates financial disaster on a large scale...

Zoning has more to do with propping up values... it creates exclusivity which can translate into demand...

50% appreciation over the last 30 to 36 months is not unusual in parts of California... people will look back at 2012 as a golden buy opportunity with low rates and depressed prices... often less than the cost to build so the land was actually free.

The other states with the worst bubbles also had low or nonexistent property taxes: Nevada, Arizona, and Florida.

Meanwhile, Texas jacks up property taxes to the skies and was unaffected by the financial collapse of 2008, and is enjoying a long boom that may survive even the current oil crash.

If you make property taxes high that means speculation will become less attractive.

13 is not the only factor in making California unaffordable - there are others - but the boom and bust cycles of speculation, and the obscene rise in housing costs, would not be as severe without 13. Nor would there be rent control. It is the only one of the major factors within the control of the state. Strengthening the US dollar, eliminating the mortgage interest deduction, abolishing Fannie and Freddie, and banning mortgage backed securities would all help, but those are federal actions. (Raising the minimum mortgage deposit to let's say 50 percent would also help, but that's usually selected by lenders, not government.)

Politicians love the revenues real estate bubbles create but in the process that means crashes are inevitable, like 2008, and like what will happen soon.

If not for 13 this thread would be about trying to support a family in L.A. on 40K a year, not 100K.

[Ultrarunner]

Originally Posted by majoun

The other states with the worst bubbles also had low or nonexistent property taxes: Nevada, Arizona, and Florida.

Meanwhile, Texas jacks up property taxes to the skies and was unaffected by the financial collapse of 2008, and is enjoying a long boom that may survive even the current oil crash.

If you make property taxes high that means speculation will become less attractive.

13 is not the only factor in making California unaffordable - there are others - but the boom and bust cycles of speculation, and the obscene rise in housing costs, would not be as severe without 13. Nor would there be rent control. It is the only one of the major factors within the control of the state. Strengthening the US dollar, eliminating the mortgage interest deduction, abolishing Fannie and Freddie, and banning mortgage backed securities would all help, but those are federal actions. (Raising the minimum mortgage deposit to let's say 50 percent would also help, but that's usually selected by lenders, not government.)

Politicians love the revenues real estate bubbles create but in the process that means crashes are inevitable, like 2008, and like what will happen soon.

If not for 13 this thread would be about trying to support a family in L.A. on 40K a year, not 100K.

Texas has had severe busts... mostly due to the price of oil... right now there is concern because oil price per barrel is down...

I pay over 9k for my 1956-57 1725 square feet East Oakland ranch style home... with Formica counters and lino floors...

People that came before me and after pay less... some way less... it all has to do with the purchase price.

I don't think my tax rate of over 1.6% is low...

I'm also glad to have many neighbors enjoying their twilight years in homes they built... most are in their 80's and 90's... lost the one that was 104 last year.... none of them could have stayed if they were paying $9,000 or more in property tax annually.

California had the perfect opportunity to address this... simply indexing the Home Owner exemption would have accomplished what you advocate... Legislature declined repeatedly and left it to the voters and the voters spoke very loudly...

Thing is in 40 or 50 years I fully intend on being the one in the neighborhood with the low taxes... and I'm OK with paying my fair share now or paying it forward.

The bust in my opinion had more to do with people buying with no skin in the game... when the bagger at my Safeway bought 5 homes in 30 months.... well, of course it was not sustainable... he lost all of them...

I've never bought with less than 20% and at times put down as much a 50%...


PS... a friend is building their home right now... it took 3 years to get design approval for a modest home in Oakland... their hard money costs... not counting the lot they bought 15 years ago or the cost to actually build is 160k... permits, engineering, utility tie in fees, etc... outrageous in my opinion...

Another friend built a home in Texas and had NONE of these costs... no permit fees except for septic... he built outside Tyler Texas and a very spacious home at that...