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1   exfatguy   2019 Sep 12, 3:28pm  

I'm not really seeing it based on "sold" prices in 95123. Yeah, there may be more sub-$500/sqft now, but there are still plenty of $650/sqft and up, for similar lot sizes, so I'm not completely convinced there's much of a slow-down. Still seems as bubbly as ever.
2   SunnyvaleCA   2019 Sep 12, 3:31pm  

We're certainly experiencing a apartment-building boom here in Sunnyvale. Traffic, noise, congestion, get worst by the month.
3   SunnyvaleCA   2019 Sep 12, 3:34pm  

When prices are 10x annual income, is it still a "boom" even if the prices are not increasing further? Seem's like we're just in a permanent boom.
4   FortwayeAsFuckJoeBiden   2019 Sep 12, 3:35pm  

A lot of things are over.

Affordable real estate
Bum and drug free streets
Good schools that don’t bend gender.
Stable work
Government that works for people and not for assholes.

This isn’t Reagan California anymore. Overall economy is good, but much is bad.

Too many illegal mother fuckers everywhere, bums, crazies, etc...
5   mell   2019 Sep 12, 4:15pm  

It's a boon
6   Ceffer   2019 Sep 12, 4:29pm  

Lipstick isn't off the crap shack pig YET!
7   RWSGFY   2019 Sep 12, 4:33pm  

SunnyvaleCA says
We're certainly experiencing a apartment-building boom here in Sunnyvale. Traffic, noise, congestion, get worst by the month.


East Bay too.
8   Patrick   2019 Sep 12, 6:33pm  

The article makes a false assertion here:

But if you had bought a year ago and sold today you would have made exactly zero.


The true assertion is that if you had bought a year ago and sold today, you would have lost 6% or more on commissions and fees.

Prices don't have to fall in order for buyers to lose money. And 6% of the price of a Bay Area house is a lot of money.
9   mell   2019 Sep 12, 9:36pm  

Patrick says
The article makes a false assertion here:

But if you had bought a year ago and sold today you would have made exactly zero.


The true assertion is that if you had bought a year ago and sold today, you would have lost 6% or more on commissions and fees.

Prices don't have to fall in order for buyers to lose money. And 6% of the price of a Bay Area house is a lot of money.


Absolutely.
10   BayArea   2019 Sep 12, 10:00pm  

The data shown in Forbes is totally misaligned with the data published by Zillow.

San Jose’s metro is down 10% YoY per Zillow.

Cities like Campbell and Saratoga are closer to 15%.

This time next year will be time to buy for those in the market.
11   RWSGFY   2019 Sep 13, 6:42am  

It's not over until I get my $3M for my shack!
12   clambo   2019 Sep 13, 9:21am  

I have anecdotes for what it's worth.

1. a big house in Aptos, CA that is for sale for $1.8 million; it was listed a few months ago for $2.4 million

2. a small house near Corralitos, CA (hills south of Aptos, north of Watsonville); the owner bought it a few years ago for $800K+ and is asking $1.3 million; it's not sold for 6 months.

3. pretty big house in Capitola, CA with a view of the ocean $2.3 million.

House #1 will sell soon enough; house #2 has to drop; it's a gorgeous location, but actually a small house. #3 is an oddball house; it's in the wrong neighborhood with crowds, traffic, etc. instead of being behind gates with a large lot somewhere.

Houses 2 and 3 are what I call "white elephants"; the owners were unclear on the concept in both cases.

My friend who sells these places says that the market is "down now" or similar phrase.
13   Ceffer   2019 Sep 13, 9:59am  

You mean my crap shacks aren't worth ten times the economies of Sweden any more? I'm devastated.
14   RWSGFY   2019 Sep 13, 12:19pm  

OccasionalCortex says
Oakley...that wonderful place on the Delta where the mosquitos are so damn big they rape the chickens!


LOL
15   BayArea   2019 Sep 13, 7:37pm  

Patrick says
The article makes a false assertion here:

But if you had bought a year ago and sold today you would have made exactly zero.


The true assertion is that if you had bought a year ago and sold today, you would have lost 6% or more on commissions and fees.

Prices don't have to fall in order for buyers to lose money. And 6% of the price of a Bay Area house is a lot of money.


@Patrick - good point but even that doesn’t tell the whole story. That 6% is not 6% of your investment. It’s 6% of the selling price!

So say you buy a $1M house and put 20% ($200k) down. The next day you sell it and have to fork out 6% of the selling price. That’s 30% of your $200k investment vaporized to a pair of realtors.

When you say “6%” and downplay the tragedy, it makes it sound like you’re a realtor lol

If that doesn’t make you think twice about home ownership...
16   Patrick   2019 Sep 13, 8:53pm  

BayArea says
That 6% is not 6% of your investment. It’s 6% of the selling price!



Thanks @BayArea I hadn't thought about that.
17   BayArea   2019 Sep 13, 9:11pm  

Patrick says
BayArea says
That 6% is not 6% of your investment. It’s 6% of the selling price!



Thanks @BayArea I hadn't thought about that.


You and I probably give this more thought than most... Like you, I’m also a Silicon Valley renter. My rent is significantly cheaper than what it would cost for me to own the same house.
18   SunnyvaleCA   2019 Sep 14, 2:16am  

BayArea says
So say you buy a $1M house and put 20% ($200k) down. The next day you sell it and have to fork out 6% of the selling price. That’s 30% of your $200k investment vaporized to a pair of realtors.

Absolutely. When you buy an "asset" with a small down payment, you multiply your leverage.

The flip side is that if the price of your shack doubles, your $1MM shack becomes $2MM, which means your $200k down payment is now worth $1.2MM. Pretty sweet! The housing boom flourishes because people love rolling the dice. (Never mind that it completely wipes you out if the market value of your shack decreases by 20%.)
19   BayArea   2019 Sep 14, 5:55am  

@SunnyvaleCA
That’s exactly right, the lever goes both ways. But given that we are just off historic highs and currently in decline in the Silicon Valley, the lever is not positioned favorably to new buyers today.

@Patrick
If there is ever a revision or a new version of Housing Trap, please do make the 6%/30% argument. I can’t thank you enough for writing that book and opening up my eyes.

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