Long term ramifications on Bay Area Real Estate and Economy (San Francisco: for sale, homeowners insurance)

[Dave Coe]

Originally Posted by GoldKona

Penny wise, pound foolish.

Not sure if we will see Texas surpass Silicon Valley as the main tech hub but the region screwed up by not allowing for more housing.

[aslowdodge]

Originally Posted by GoldKona

Penny wise, pound foolish.

Why so?

[GoldKona]

Originally Posted by Dave Coe

Not sure if we will see Texas surpass Silicon Valley as the main tech hub but the region screwed up by not allowing for more housing.

We don't need more housing, we need less people. More housing will just crap up the place so eventually it will be less desirable.

[GoldKona]

Originally Posted by aslowdodge

Why so?

Housing makes homeowners multimillionaires in the Bay Area. These are high paying jobs that the workers can afford to buy in and get on the millionaire ride. Texas not so much.

[roadwarrior101]

Originally Posted by Dave Coe

Not sure if we will see Texas surpass Silicon Valley as the main tech hub but the region screwed up by not allowing for more housing.

I wouldn't read too much into the HPE move. They're an old, stodgy tech company that isn't growing and is looking for mechanisms to cut costs. They can save on labor costs and taxes in Texas and don't need to be in the valley as they're not attracting the top Berkeley/Stanford engineers. This is similar to what we've seen with other tech companies for quite a while in that most of the start ups and fast growing companies are in the valley and they'll branch out when they reach another level of maturity.

Not saying that the Valley doesn't have its problems, it certainly does. But, I don't buy this sky is falling argument.

On the other hand, good for Texas for picking up a solid company that'll add white collar jobs. That goes to show you that this isn't a zero sum game.

[DabOnEm]

Originally Posted by roadwarrior101

I wouldn't read too much into the HPE move. They're an old, stodgy tech company that isn't growing and is looking for mechanisms to cut costs. They can save on labor costs and taxes in Texas and don't need to be in the valley as they're not attracting the top Berkeley/Stanford engineers. This is similar to what we've seen with other tech companies for quite a while in that most of the start ups and fast growing companies are in the valley and they'll branch out when they reach another level of maturity.

Not saying that the Valley doesn't have its problems, it certainly does. But, I don't buy this sky is falling argument.

On the other hand, good for Texas for picking up a solid company that'll add white collar jobs. That goes to show you that this isn't a zero sum game.

What are you talking about? Data analytics is huge right now and growing fast, which is one of the main things HPE specializes in. The Silicon Valley will likely always remain the hub for innovation, but I wouldn't downplay a fortune 500 company with a positive outlook moving away.

[Dave Coe]

Originally Posted by GoldKona

We don't need more housing, we need less people. More housing will just crap up the place so eventually it will be less desirable.

I'm personal a critique of mass immigration but the political and economic elites are so invested in immigration that change is not likely. NIMBYism is just a way that Boomer Whites screw over their progeny.

[aslowdodge]

Originally Posted by GoldKona

Housing makes homeowners multimillionaires in the Bay Area. These are high paying jobs that the workers can afford to buy in and get on the millionaire ride. Texas not so much.

I think a lot of people can’t take advantage of this. How about other parts of California? I think the group of Californians that can afford to buy and get on your money train is fairly small, maybe 16 to 20 percent?

There’s also this to think about which I wrote in another post.
“You do realize that depending on where you are the same house in Texas may well be 1/4 the cost in California. A house in my home town in California could be 1.4 million and a similar home might be 250K in Texas. Property Taxes in Ca would be 15K a year and 5k a year in Texas.
Income tax on 100K income in Ca is about $6800 vs nothing in Texas.
So that's about $17,000 in savings on Taxes per year.

Take the $250K and pay for the house cash in Texas, no payments, In Ca that $250K is a down payment and even with low interest rates you pay $58,176 a year. Now the difference is $75,176K a year more in Ca than Texas.
Take that $75,176K a year and put it in the market at 8% per year for the life of a 30 mortgage and in Texas you will have $9,404,113 after 30 years”

That’s a version of the Texas money train.

[roadwarrior101]

Originally Posted by DabOnEm

What are you talking about? Data analytics is huge right now and growing fast, which is one of the main things HPE specializes in. The Silicon Valley will likely always remain the hub for innovation, but I wouldn't downplay a fortune 500 company with a positive outlook moving away.

Everyone always likes to cute a token company moving away as the demise of California yet the Silicon Valley continues to lead the pack (by a mile) with new start ups and VC funding. Good for Houston for growing their tech market but it’s disingenuous to act like the sky is falling for California. It’s more of a matter of the pie size increasing and everyone getting a larger slice.

[DeanoSF]

Originally Posted by roadwarrior101

Everyone always likes to cute a token company moving away as the demise of California yet the Silicon Valley continues to lead the pack (by a mile) with new start ups and VC funding. Good for Houston for growing their tech market but it’s disingenuous to act like the sky is falling for California. It’s more of a matter of the pie size increasing and everyone getting a larger slice.

True. I'm from Houston and HP has had a huge presence there since buying Compaq computers 20 years ago. Seriously, the HP campus is huge in North Houston. The reason they purchased Compaq was largely for Compaq's server business (not the PC business). So, that explains the interest in relocating HPE--in fact, the relocation is probably 15 years late.

The HPE (Enterprise spinoff of HP) relocation is great for Houston, but HP's core technical jobs will stay here in California...if HP wishes to remain competitive in any business outside their printers... a position that has been subject to some scrutiny over the past decade or so.