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Location: Live:Downtown Phoenix, AZ/Work:Greater Los Angeles, CA
27,606 posts, read 14,451,163 times
Reputation: 9169
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Quote:
Originally Posted by Cdsmd
Yep. I work in underwriting commercial real estate loans all throughout socal. Tons of new supply coming online, but demand is still through the roof. Too many people want to live here.
There is a difference between demand and desire
There can only be as much demand as their are jobs, unless the majority moving in are trust fund babies
Great for you who can buy a place. I'm not really interested in seeing who can afford a home or not just by judging if they can purchase property (or purchase a mortgage) in their name.
Seems like that's everyone's benchmark these days, if you can get loaned x amount of dollars to buy something, you've made it regardless of the price. My benchmark is proportions...like you should not buy a home that costs you over 3x your annual household income (or to be specific, you should not mortgage/borrow anything over 3x your annual household income, that's house price - downpayment + closing). Or you should not buy a car that costs over 50% of your annual household income. Or the real benchmark is... can you even pay the sucker off. Lol...The people I know, who are approaching retirement, hasn't paid off their house yet, my parents included... So that tells you something.
I don't care what the loan terms are. You can make something seem affordable just by lengthening the loan... or playing all sorts of games with taxes/interest rates to lower the monthly payment.
But it still stands, at exactly the moment in time you decide to purchase something. Your income was x dollars, you spent x dollars you had, and you spend another x dollars you didn't have. Can you really afford that purchase?
The answer for most living in SoCal would be a big fat NO, if you follow the rule of thumb.
I agree with your debt to income ratio but who are we to judge? the reason you have something like 1/3 of your income go to housing related expense is so that you can save also for your retirement, have vacations once a year, eat out every night.
but how about if others forgo those vacations? those eating out every now and then and just concentrate on having their houses?
if you ask me, its hard if you just work and work so that you can pay your mortgage but I wont judge those who chose this path. its their life. maybe its their American dream.
in the apartment we lived before, I had an Egyptian neighbor whose sons were a doctor and an investment banker. maybe he chose to just live in an apartment so that he can send his children to college.
my point is, having a house is a matter of choice. after all, the basic needs didn't say own a house. it says SHELTER
"Building like crazy" is just what you see. Building enough to keep up with demand to keep prices stable is a different story ("stable" meaning, prices rise with or close to the rate of inflation). Which many many studies already say, CA is not building enough just to keep up with demand.
Also if you didn't realize, most skyscrapers are being built are luxury housing. Because... conceptually, because of high demand, if you put all the rich folks into 1 luxury building, then the demand/price for other not-so-luxurious apartments for normal folks will be maintained because... if you don't house the rich folks somewhere, they have the money to out-bid the normal folks and jack up the rent for normal looking places and force them out.
They can't build fast enough. I dont understand why you don't get that. There isn't enough enough time material and labor to catch up to the current demand. Much less futurecdemand. It's a exponential problem. In order to build enough as you say you need to run three shifts. Where are you going to get the people to do it. Where do you plan on housing these people? Get them to work? You can't just take a guy off the street and teach him to build a house in a week. It takes years of learning and training. You're not going to snap your fingers and have a house built. I don't think either of you understand what it takes to build structure much less one that houses people.
You want someone to take the risk of building enough housing and to nowmake it affordable too, maybe prices can keep up to the rate of inflation and what else on your wish list? Close to your work? Fully furnished? Paid utilities?
Hey here's a idea. Sune it's so easy why don't you put up your money and build only affordable housing. See how far it gets you. The reason they are building luxurious housing is because people want to make money. Welcome to the real world. I don't care what you say if you were a builder you would build what makes you money. Otherwise feel free to prove me wrong. Go get investors start up a construction company and tel your investors you're not goingbto build affordable housing. I bet you'll have a empty room by the end of that meeting.
Quote:
Originally Posted by FirebirdCamaro1220
LA city's supply was artificially constrained by Proposition U which the voters passed in 1986. Prior to Prop U, LA city building codes were able to plan for a population of 10 million in the city, but after Prop U's passage, planned density was forced down by 55% on all new units that broke ground after 1986, lowering the planned population of LA city to 4.5 million. So voters created their own problem. Measure S if it hadn't failed would have made it even worse
Feel free to exercise your rights and go get enough signatures to get a prop on the ballot to build affordable housing.
Quote:
Originally Posted by man4857
Great for you who can buy a place. I'm not really interested in seeing who can afford a home or not just by judging if they can purchase property (or purchase a mortgage) in their name.
Seems like that's everyone's benchmark these days, if you can get loaned x amount of dollars to buy something, you've made it regardless of the price. My benchmark is proportions...like you should not buy a home that costs you over 3x your annual household income (or to be specific, you should not mortgage/borrow anything over 3x your annual household income, that's house price - downpayment + closing). Or you should not buy a car that costs over 50% of your annual household income. Or the real benchmark is... can you even pay the sucker off. Lol...The people I know, who are approaching retirement, hasn't paid off their house yet, my parents included... So that tells you something.
I don't care what the loan terms are. You can make something seem affordable just by lengthening the loan... or playing all sorts of games with taxes/interest rates to lower the monthly payment.
But it still stands, at exactly the moment in time you decide to purchase something. Your income was x dollars, you spent x dollars you had, and you spend another x dollars you didn't have. Can you really afford that purchase?
The answer for most living in SoCal would be a big fat NO, if you follow the rule of thumb.
To each his own. I sacrificed so I could own properties in So Cal. When i was in my 20-30 years old I got married and we drove the same vehicles didn't go on lavish vacations. We sacrificed having the good times to build a future. But now the sacrifices we made when we were younger are paying off. Housing is expensive. That has not changed since about the 80s in So Cal. I just bought a house last year. But I bought before prices were going through the roof. And I bought well within what my affordability as. It's a nice 2300 sqcft house on 1/2 acre.
So why didn't your friends or yourself buy at the last downturn? Prices were in the dumpster. I'm betting people were waiting for prices to come down even more. Because it "wasn't worth it" at that price. Right? I was desperately trying to buy.
You don't even live here. I don't even see why you're so worried about So Cal real estate market? I'm guessing you want to move here and are one of the priced out people?
Last edited by Electrician4you; 06-02-2017 at 04:04 PM..
I agree with your debt to income ratio but who are we to judge? the reason you have something like 1/3 of your income go to housing related expense is so that you can save also for your retirement, have vacations once a year, eat out every night.
but how about if others forgo those vacations? those eating out every now and then and just concentrate on having their houses?
if you ask me, its hard if you just work and work so that you can pay your mortgage but I wont judge those who chose this path. its their life. maybe its their American dream.
in the apartment we lived before, I had an Egyptian neighbor whose sons were a doctor and an investment banker. maybe he chose to just live in an apartment so that he can send his children to college.
my point is, having a house is a matter of choice. after all, the basic needs didn't say own a house. it says SHELTER
You're stretching this too much. Spending 1/3 of your income on housing gives you the flexibility to save a reasonable amount of money for larger things like retirement... car, house renovation, unexpected emergencies, the vacation here and there, supporting family, etc.. Having vacations once a year and eating out every night will demolish those savings easily. You will not be living that type of lifestyle if you spend 30% of your income on housing.
But yes it is a choice. But how many people own up to making a bad choice? Cause if you look at the statistics, most Americans do not have a nickle saved for emergencies, nor enough for retirement, and most are in debt up to their eyeballs. That's just a fact. This starts with correctly setting priorities. Yes you need a roof over your head. But you don't need a roof that costs you an arm and a leg. etc... Nor do you need that fancy car with all the upgrades where you must take out a 7 year loan for.
Location: Live:Downtown Phoenix, AZ/Work:Greater Los Angeles, CA
27,606 posts, read 14,451,163 times
Reputation: 9169
Quote:
Originally Posted by Electrician4you
They can't build fast enough. I dont understand why you don't get that. There isn't enough enough time material and labor to catch up to the current demand. Much less futurecdemand. It's a exponential problem. In order to build enough as you say you need to run three shifts. Where are you going to get the people to do it. Where do you plan on housing these people? Get them to work? You can't just take a guy off the street and teach him to build a house in a week. It takes years of learning and training. You're not going to snap your fingers and have a house built. I don't think either of you understand what it takes to build structure much less one that houses people.
You want someone to take the risk of building enough housing and to nowmake it affordable too, maybe prices can keep up to the rate of inflation and what else on your wish list? Close to your work? Fully furnished? Paid utilities?
Hey here's a idea. Sune it's so easy why don't you put up your money and build only affordable housing. See how far it gets you. The reason they are building luxurious housing is because people want to make money. Welcome to the real world. I don't care what you say if you were a builder you would build what makes you money. Otherwise feel free to prove me wrong. Go get investors start up a construction company and tell your investors you're going to build affordable housing. I bet you'll have a empty room by the end of that meeting.
Feel free to exercise your rights and go get enough signatures to get a prop on the ballot to build affordable housing.
The way it's supposed to work, is when demand is high, that is supposed to encourage people to enter the market. And then as supply starts to catch up to demand, prices will start to fall and eventually, equilibrium will be reached. Right now there is market disequilibrium, due to demand being there, but not enough development to satiate that demand. Granted the new units would be expensive, and would go to higher income/wealth individuals, but it is supposed to cause 'drainage', lowering demand for older lower quality units, and therefore the prices of the older units. That is how a healthy housing market works
Location: Live:Downtown Phoenix, AZ/Work:Greater Los Angeles, CA
27,606 posts, read 14,451,163 times
Reputation: 9169
Furthermore, no one is arguing that San Clemente or Dana Point should be affordable, but there is no reason that Stanton, Santa Ana and parts of Westminster and Garden Grove shouldn't be more affordable
Furthermore, no one is arguing that San Clemente or Dana Point should be affordable, but there is no reason that Stanton, Santa Ana and parts of Westminster and Garden Grove shouldn't be more affordable
there is a reason why Westminster, Garden Grove and the Santa Ana part adjacent to these cities are pricey. all Vietnamese want to live in that area. that's their #1 priority.
You don't even live here. I don't even see why you're so worried about So Cal real estate market? I'm guessing you want to move here and are one of the priced out people?
I'm not "worried" about the SoCal real estate market. I've been observant of what's going on when I was growing up since I grew up in LA, born in Pasadena. It's basically a game. I used to want to stay and play the rat race you and a few others have talked about, but as I got older, I snapped out of it because all the previous threads that has been started about housing prices in LA has always been about either:
1) Make more money,
2) Buy a condo and move up like everyone else
But nobody never ever says, you just simply can't afford to be there.
But now, I don't want to buy there if the way things are going keeps it's course. I got priced out so it is what it is, I really don't care. I rather stay in Phoenix where it's still affordable and I'm not living paycheck to paycheck and don't have to think too much about throwing $300 away if I felt like it. People are still nice. Houses are not falling apart and being sold for $500K. People actually have money to buy nice things and save.
However, telling people you can afford SoCal real estate, is a lie., given the income/real estate statistics, rule of thumb. What is really happening is, people are taking out bigger mortgages than they would, just to stay in the area. (i.e. buying something due to emotions, not pure mathematics). It's just a mathematical truth whether you want to believe it or not. Roommates, driving crappy cars, etc... living like you're in a 3rd world country, is all the excuses I have heard to be on the way to own real estate in SoCal. They're all just excuses from admitting the truth. Articles like what the OP posts, is just more evidence that people are living in their own bubble, not actual reality.
Furthermore, no one is arguing that San Clemente or Dana Point should be affordable, but there is no reason that Stanton, Santa Ana and parts of Westminster and Garden Grove shouldn't be more affordable
Yeah but to create housing stock for people in Arizona to move to, say, San Clemente might mean exerting eminent domain over the property, paying a "market" rate and then building whatever FirebirdCamaro1220 wants so the prices drop to a level he thinks appropriate, right? Current owners who refuse are "damn NIMBY's" who make San Clemente too expensive...right?
Last edited by LuvSouthOC; 06-02-2017 at 04:39 PM..
Yeah but to create housing stock for people in Arizona to move to, say, San Clemente might mean exerting eminent domain over the property, paying a "market" rate and then building whatever FirebirdCamaro1220 wants so the prices drops to a level he thinks appropriate, right? Current owners who refuse are "damn NIMBY's" who make San Clemente too expensive...right?
We get it, you want your investment(s) to grow. Ok just admit it already.
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