California affordable housing at all time low (Los Angeles, Pasadena: real estate, foreclosure)

[hedgefundpirate]

the cost of living in Los Angeles or anywhere else in California continues to climb.How do people do it? You would have to have two people earning quite a bit more than the national average in order to afford the high mortgage payments.My second question is why would anyone want too when you could move somewhere else with a better quality of life.Check out the article

http://www.dailynews.com/gregwilcox/ci_5172619

[JerZ]

Oh yeah. It's bad. Why do people want to live here? Well, for one thing, it's somewhat relative. People make more money too (by comparison to other areas of the country, I mean...excepting the northeast, which is pretty bad too).

Another reason, of course, is the generally milder weather.

I think a third reason, and this reason is huge, is family. I know that's why DH wanted to move back here. Don't discount the power of homesickness. It's horrible. It really makes a person suffer. I hurt every single day missing my peeps in NJ. Some might say, "Jersey? Are you joking? That cesspit? (A myth, BTW, but that's more an argument for the NJ board.) And the cost of housing...who in his or her right mind would pay $500,000 for a three-bedroom house?" But again...if you commute to NYC, you can make one buttload of money...and the other factor, again, is family. (I will put in here that houses in SoCal are actually even more expensive than they were in northern NJ...something I didn't think possible. :P Two houses went up in my neighborhood last year over $600K for simple three-bedroom dealios.)

Most of the people I've met though who came from other places to southern California did so for the weather. Hands down. That's what I hear over and over and over again.

[JerZ]

OK...located a stat from the statistics bureau saying the average household income in southern California is $53K. Homes are still high by comparison to salary (I won't lie...and I feel it...ouch), but let's face facts, not many couples buying that oh-so-cheap $175,000 house in, I don't know, Georgia can possibly hope to make $53K. So although house prices do remain high compared to salary in SoCal, it sounds like a lot more of a shocker to someone who doesn't come from here and doesn't make that kind of money.

[sjd]

to answer your question: people are in debt up to their eyeballs. Most people get the adjustable arm, negative amortization or interest only loans hoping that their home appreciates faster than their debt. It is a risky game, but one you must play in order to get into your first home in Cali. That is why 1 out of every 970 homes in in foreclosure right now. Not fun.

[Sorcerer68]

One thing to take into consideration when looking at the "average" stats is that a 2 million dollar house will be averaged in with a 400k house. To get a true average, you must compare apples with apples. That said, of course houses are more. You can also earn exponentially more money. My good friend in Cincinnati tells me about great houses for 50k. You're also lucky to get a job paying 9 bucks an hour (or less). I've never had a problem making it in L.A. It's all relative. Hawaii is a beautiful and hellishly expensive place to live although I carved out a very good living. Vegas wasn't terrible but quality of life wasn't up to my standards. Abundance is in Los Angeles for those who make an effort and honestly seek it.

[eyeamsochill]

its true, people always say they move there for the weather..I lived there my whole life, just recently moved to san antonio, tx. and the weather is not much different. summer in LA this year was a killer, and from what I hear so has this winter. so maybe that will change soon

[J1ndo]

For me, I grew up here and have stayed because of family, friends and, let's face it, it's all I've ever known. JerZ hit the nail on the head, most people live here, most people live anywhere they do, because of family and/or their job. But yeah, it's hellishly expensive. After a lifetime here, I'm looking to leave.
How do people afford it, you ask? Not a clue. I make what I think is good money, but can't even dream of affording a house. I guess the options for most people are to rent or to take on an exotic but ill-advised mortgage scheme to pay for a home (a home very very far away from their jobs).

[DawnW]

Housing is one of the reasons my husband won't move back.

We sold a 2 bedroom house in Pasadena for 600K. It was built in 1910.

Dawn

[Axiom]

We've been researching this since we have a job offer in CA
I'm with those of you who just don't understand how people manage.


One of the websites I consulted stated that employers in OC typically pay 10.1% more than employers in Phx for the same job.
(almost exactly what our offer came in at btw)

Yet the cost of living there is 28.3% higher and that's just consumer price index and tax figures, does not take into account higher housing/rent costs.

I'd say a very conservative estimate is that housing there is 150% more and rent is twice as much or more.

We've got way more house than we need here and are willing to downsize substantially, but even so we'd still need a salary increase of 50% or so to remain relatively whole. Not likely to happen I'm sure.

[SoCal Person]

It's all about timing out here, and like others said you have to start in a 'starter' home in a less than desireable area, usually. We have a lot of equity but if we move now we'll have an outrageous tax rate on a newer, nicer home.

We should have timed it better, and moved four years ago before the big leap in real estate. We would have had less equity ourselves, but the new tax wouldn't be so bad on a move-up type home.