I never thought I would say this.... (Huntington Beach, Newport Beach: houses, buying)

[EscapeCalifornia]

Originally Posted by Curmudgeon

But would you be earning enough there to live like that back there? Wages usually seem to ebb and flow with housing prices.

Wages and home prices do vary together but its not a 1:1 relationship. We all know coastal California's incomes in no way make up the the inflated home prices.

[Mr. Fantastic]

Originally Posted by EscapeCalifornia

Wages and home prices do vary together but its not a 1:1 relationship. We all know coastal California's incomes in no way make up the the inflated home prices.

Yeah, I know very few people in Newport Coast that own a home 3.5x their yearly income.

[CAVA1990]

Originally Posted by Mr. Fantastic

Yeah, I know very few people in Newport Coast that own a home 3.5x their yearly income.

How do you know if that's true in general? Do you have any statistics that show the average selling price/household income relationship that existed for all homes at the time they were purchased? Also, keep in mind that price/income relationships don't mean a whole lot for mostly/all cash buyers, which a lot of these folks were or are.

[cl723]

Yes, it`s very expensive and the tax on everything is outragous.

[Mr. Fantastic]

Originally Posted by CAVA1990

How do you know if that's true in general? Do you have any statistics that show the average selling price/household income relationship that existed for all homes at the time they were purchased? Also, keep in mind that price/income relationships don't mean a whole lot for mostly/all cash buyers, which a lot of these folks were or are.

I'm not at liberty to discuss the personal finances of my numerous clients, it's a legal liability for me, so forgive the lack of hard details.

But as a financial advisor, and real estate broker who closed 90+ deals in 2009 alone, I have a very unique insight into the lives of people living in wealthy areas of SoCal.

I know people who are so over leveraged living in Newport Coast that a few of them are only months away from filing bankruptcy. These aren't your average two income, lawyer and pediatrician, type families. These are people who are successful business owners grossing tens of MILLIONS a year. Against my best advice, many of them chose to over leverage themselves in certain sectors and lost a lot of skin.

[CAVA1990]

Originally Posted by cl723

Yes, it`s very expensive and the tax on everything is outragous.

That's all relative to your income. I'm sure Warren Buffett finds it quite a good bargain.

[cl723]

My guess is that they are spending more than they earn and didn`t think twice about it until it was to late.

[cl723]

cava, to some degree ,yes but I know people who live in Cal that are just making average middle class wages.There are a lot of those folks in cal and the high cost of living is brutal for those people.

[Mr. Fantastic]

Originally Posted by cl723

My guess is that they are spending more than they earn and didn`t think twice about it until it was to late.

Eh. A lot of rich people think they can multiply their dollars fairly easy, and for the most part it's true, but it requires educated decisions. Lacking that, a lot of money can be lost very quickly.

[CAVA1990]

You seem to be associating the problems seen in inland areas with the coast. They're two different worlds and a good example of the bifurcation of our modern economy. The wealthy are doing quite well right now, thank you very much.