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Hands up all you who remember California real estate falling 50% or more from 2008 to 2011.
C'mon folks. This was just 10 short years ago. Don't tell me you have forgotten already. Where are all the people who were saying in 2011, "California real estate will never go up again. You should rent."
Everything cycles. We are in an RE boom. It is going to bust eventually.
prices dropped in probably 90% of CA at some point in 2006-2010 at least.
So, I'm not sure if we can say "California" as a monolithic entity will do anything uniformly or not.
California home sales peaked in 2006. Home prices peaked in 2008. Prices lagged sales by 2 years because it takes a while for people to realize sales are tanking. I fully get your point. I was just pointing out that prices didn't start dropping until 2008. Bottom was 2011.
I hope I am not being an ass fine-tuning your thought.
They were definitely falling in 2007 when I came out. Maybe not enough to be noticed, but the trend in the Bay Area was already in retreat. (maybe not in SF proper though)
It may not be true of all of California, but you'll start seeing the weaker neighborhoods go soft first.
They were definitely falling in 2007 when I came out. Maybe not enough to be noticed, but the trend in the Bay Area was already in retreat. (maybe not in SF proper though)
It may not be true of all of California, but you'll start seeing the weaker neighborhoods go soft first.
SFbay area tends to lead the booms and leads the busts as well. When bay area home sales slow down, the rest of the nation is ready to seize up. The Bay Area is a leading indicator.
"Location, location, location" mantra has taken quite a hit after COVID showed that most of the work paying salaries that made CA expensive in the first place can be easily done remotely from anywhere in the world. Hollywierd and farms won't do much for propping up real estate if big IT gets communismed out.
I was thinking more of entire company HQs moving to friendlier states, but the telecommuting thing is for real, too, especially with some big improvements in broadband. Look at what Elon Musk, alone, has done.. moved Tesla out, and is now offering Starlink to more customers every day. I just got an email about availability in NE Wyoming.. My house is in town, but for folks five miles from me, it is a game changer.
It would be interesting to look at a list of California's top 200 tech companies and show what the probability of them moving out is. Could range anywhere from would never move to already notified employees to start buying warm coats.
Not just home prices, but the costs of living in those homes, and as a resident of California, should be considered, as well as the future growth of those costs. That is why I wouldn’t move there.
California has a incredibly wonderful climate, which is certainly valuable.
I have direct experience with just one house in California. Here's how it has gone:
1987: Bay Area housing is so expensive. We could hardly find anything under $100K!
1992: The market is so bad, nobody will pay $170K for this house.
2005: Prices are out of control, let's sell! (Went for $540K a week later.)
2008: Yikes, it was foreclosed and resold for $170K.
2013: Sold for $380K
2018: Oh my, it's worth $540K again!
2021: Zestimate $619K
So I'd say prices trend upward, with notable downswings. When interest rates go up, prices come down. Shop smart, and you can do well.
Location: Formerly Pleasanton Ca, now in Marietta Ga
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Quote:
Originally Posted by Igor Blevin
Hands up all you who remember California real estate falling 50% or more from 2008 to 2011.
C'mon folks. This was just 10 short years ago. Don't tell me you have forgotten already. Where are all the people who were saying in 2011, "California real estate will never go up again. You should rent."
Everything cycles. We are in an RE boom. It is going to bust eventually.
I was there. I never thought it would stop going up. I figured it might just go up about 3% a year for a good while. Boy was I off.
Prices have gone up and down quite a bit just over the past 12-15 years; you can't say they have "never" gone down or will "never" go down again. But will there be a time when California housing prices will decline to a point where they are commensurate with housing prices in less desirable, low COL states like Arkansas? I highly doubt it, not in any of our lifetimes.
More than 12-15 years. I was an appraiser in LA in 1989-1991. Properties were appreciating at 10% a month. I left LA and moved back in '93. I was going out looking at properties after values tanked to make sure they still qualified for the amounts of the loans. Most didn't.
When I moved to San Francisco I got an Apartment for almost $2,000 a month. After a year or two the landlord asked me to buy the property for $1,000,000. I st the number floored me. I had no id a how much I would get in retirement. I could have gotten a mortgage that would only pay the interest. I didn’t, the landlord died and his wife sold the building. LasbI saw my apartment/condo sold for $1.2 million, the building must be worth $5 million. That is California.
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