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Another mind F*&!


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2011 Oct 27, 4:02pm   20,971 views  72 comments

by Buster   ➕follow (0)   💰tip   ignore  

The last weeks I have, like most of you, been thinking very intently on the state of our union, the economic disparities, the corruption of our systems and institutions, real estate and even OWS.

So here is another kicker. I decided to toss in the towel and buy a place, in spite of most here and elsewhere reminding me of my potential folly. But I finally found a place that we adore and it made financial and spiritual sense so to speak. It just feels right. Tomorrow we close on the deal.

Tonight under the door, our rental complex 'landlord' slipped a rent increase notice under the door. When I read it I about sheet a breek. We rented a place DT on the Embarcadero as we are new to the city and didn't really know where we wanted to live and didn't have time to visit the city to shop around for rentals. What we rented is nice, but nothing great. It does have a stupendous view of the Ferry Building and overlooks a huge chunk of DT and the SF Bay. Stunning. 600sf, an equally large balcony on the 18th floor and a block to Bart/Muni and the Transbay Terminal. Rent $3200. Rather steep but manageable and I get it for the convenience and view. Tonight I find out that if we choose to stay, our rent is going up to.....drum roll....$5200/month. No lie.

So of course I am elated that we have someplace to move to, for quite a bit cheaper, 3x as big and in a great setting and neighborhood just north of the city. But I truly get why the 99% are so pissed and why OWS is more than justified in their anger. It is like everyone is now out of their homes or folks with good jobs and cash can't even buy a place if they wanted to are all flooding into the rental market, allowing landlords such as mine an open opportunity to screw everyone. Pay it or get out.

So my question is this; do they now have us pinned in a double whammy? Is this the beginning of skyrocketing rents even as housing prices continue to drop lower? Is the middle class just so screwed that it has gone completely numb with the shifting realities? Quite frankly, I am joining OWS. I used to even be a loyal democrat. I am now, simply, the 99%.

So what are your thoughts? More rent increases? More social unrest due to what I describe above? I am just a little freaked out at the moment I guess. I do well financially and can only feel compassion for those who make far less. Not even sure how folks are making it. I know, I know, some will say that they are renting someplace an hour or two from the city for 400/month and they don't know what I am talking about....Love to hear what you are all seeing/hearing/and experiencing out there....thanks.

#housing

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60   mdovell   2011 Oct 29, 7:45am  

Bellingham Bill says

The Mac was the first computer with its act together, good enough to bring us the desktop publishing revolution. The NexT was the first computer good enough to host the invention of the www. iMacs made computers fun again. The iPod revolutionized portable music. The iOS stuff brought phones into the 21st century finailly.

I wouldn't really go that far. Commodore 64 sold 30 million. You can make the argument that was the first computer that had a real GUI..GEOS came after Mac there's no argument there. www might have been on the next but aol started with commodore 64. If it wasn't for aol the public probably wouldn't have been online to start with. Compuserve was much more professional but sadly it was bought out (The Well still lives :-D)
aol was basically the training wheels for people as they learned to use the internet..

Apple products have a nice design and that's good to accommodate new users but sometimes that reminds me of the USA vs Japanese design.

In Japan people actually study user manuals so that they can master new devices. In the USA we seem to want them simplified to make them idiot proof. Jokes about "Where's the any key?" are abound.

61   Â¥   2011 Oct 29, 8:52am  

mdovell says

Commodore 64 sold 30 million. You can make the argument that was the first computer that had a real GUI

C64 was a toy computer with a toy GUI. As was the Apple II in its history.

And so was the Mac, until the OS and hardware matured in the Mac Plus timeframe (1986).

The problem with Commodore and Atari systems of the 1980s was their system engineering sucked. Worse than Microsoft's, and that's saying something, though of course Microsoft was hobbled by that horrid x86 mis-architecture.

The success of the web came from the ability for anyone to establish a peer node and post content on it. What an amazing invention, and it was invented on a NeXT in 1990-91.

Apple had developed the pieces of the puzzle already -- HyperCard, which came out in 1987, and MacTCP, which was available in the late 1980s AFAIK, but it took a while to percolate the idea that the two could work together, given the sheer logistical difficulties of getting a Mac with TCP onto the internet.

Every NeXT cube shipped out of the factory with all these puzzle pieces already in place -- very advanced object-oriented application frameworks, GUI designer IDE, megapixel display, built-in ethernet networking with a full BSD TCP/IP stack. In retrospect, NeXT should have named their system the "World Wide Web Invention Kit".

62   HousingWatcher   2011 Oct 29, 10:28am  

Microsoft as of late has been a failure and their current CEO should be fired tomorrow. They failed to take on Google. They failed to take on Facebook. They failed to take on YouTube. They failed to take on Apple's tablet and ipod market.

63   Â¥   2011 Oct 29, 11:14am  

Microsoft doesn't have to "take on" things any more than Ford has to "take on" Nissan.

Microsoft's scorched-earth winner take-all way of competing 1980-2000 harmed users -- those stuck on x86 at least -- greatly.

Microsoft just needs to start finding its own vision, not just copy everyone else all the time. if it's a smaller company for that, so be it.

They should just focus on the xbox 360. DirectX and that is the only thing they're at all competent in.

64   alpo   2011 Oct 29, 12:34pm  


Why the F are we exempting landlords from fair property taxes? Prop 13 is truly insane.

property tax on a house that I have bought and live in does not make sense to me at all. Its a completely ridiculous concept. In fact, all different forms of taxation should be consolidated and condensed into a SINGLE tax and property tax be eliminated all together. It is completely ridiculous that I have to pay the government to live in my own house.

What's needed is just the opposite: a Prop 13 for tenants. Germany has laws like that: where once you're renting, you have a certain security in your rental. The landlord can raise the rent only so much each year, and must offer you a lease renewal.

Germany is doing just fine with laws that protect renters.

Seems like an open invitation for creating a black market in rentals. No incentive for improving the property for getting a better rental rate.

65   Patrick   2011 Oct 29, 2:24pm  

The single tax should be the land value tax.

You didn't make the land.

You didn't buy the land from anyone who made it.

It harms the economy to tax work, or sales, or any other productive form of behavior.

Mere ownership of land is not at all productive. It does nothing for anyone else. Only you.

That's why the single tax on land makes sense.

66   skinnyninja   2011 Oct 30, 4:45am  

That is brilliant about the land tax. I hate taxes.

I am single and rent a one bedroom apt. in Michigan for $470/month right now. There are homes for sale in my area that run from 10K to 30K that do not need major work that I could not handle. It was enticing a year ago, now it is super enticing. If it keeps up I might have to buy.

But the reason I keep renting for now is due to property taxes. The school districts that these homes are in seem to extract quite a bit of money in "rent." I will have to call the township and see what my actual property taxes on some of these places would be. Some of the online estimators say as low as like $300/year in prop. tax. That would get me buying in a heartbeat.

I am an entrepreneur so my goal is always to get my monthly expenses lower. If I can buy a house outright and live in it for less than what I rent for I would do it, just for the cash flow advantage.

I know the alternative is to keep renting but invest my 20 grand elsewhere, but honestly I don't see any investment options that make this enticing to me.

Houses are so cheap around here that you don't need a mortgage, which is awesome. On the other hand, they have not raised my rent for a few years either.

Property taxes infuriate me and that is sort of why I keep renting. It just seems like a wash most ways I figure it.

67   mdovell   2011 Oct 30, 5:36am  

Should it really be a single tax though? As much as dislike a income tax wouldn't it make a bit more sense to charge more in a property tax based on the value of the property?

If someone has a very large house wouldn't that become more taxing if a fire breaks out vs one that is smaller?

If you make significant expansions I'd assume a larger tax. If a house is shrunk by eliminating rooms or a floor I'd assume a lower tax. Besides what if someone kept adding more floors to a house and simply rented them out..that adds to value and can take away demand from housing in general (in aggregate).

Not all land is of the same quality. If soil is fertile a farmer would value it more than one that is of poor quality (crops have to rotate to put nutrients back in the soil)

In NH they have no sales or income tax but they have statewide property..they are starting to have taxes based on views
http://en.wikipedia.org/wiki/View_tax
It is a interesting concept since it makes an assumption of preservation.

68   Â¥   2011 Oct 30, 5:50am  

mdovell says

it make a bit more sense to charge more in a property tax based on the value of the property?

? I don't see any reason to annually tax people on the value of their capital improvements to the land. Why we do this now is a total mystery to me, penalizing people for remodelling their house! Totally retarded.

.they are starting to have taxes based on views

This is LVT, yes. California has a inhabited coastline of hundreds of miles -- call it 800 miles. The first ~2 miles from the shore line is primo land, that's roughly 1600 sq miles of primo land, x 640 acres is a million acres. 10 lots per acre, that's 10 million lots. $10,000/yr lot tax, that's $100B/yr dollars of land value revenue theoretically available.

This would gore some very powerful oxes though so we'll never see this enacted.

69   Jon137   2011 Oct 30, 7:53am  

The GOP says

Apple never made an affordable computer, that could be delivered to such a wide user base as MS. Their iPods were the start, but even they started out as something only rich were willing to be first adapters.

They did a few smart moves back in the 80s, though. When both PCs and the new Macs (IIe at the time) were prohibitively expensive for anyone, they donated tons of computers to schools. This is one reason why teachers still love them to this day. And now the money buying school computers is government money, or locally issued bond money.

The real "people's" computer back in the 80s was the C64. It could be hooked up to a television and cost in the hundreds. Most of my computer friends who are now silicon valley code jockeys got their start with the C64.

70   Jon137   2011 Oct 30, 7:59am  

One more thing on rent control and SF. SF uses a similar formula as Oakland with a rent board controling increases. However, if you look at their % increases it's totally not in line with what's going on in SF. It's 1%, or 0.5% per year, not even in line with annual inflation.

Either that, or there are a lot of 1%'ers in SF, which is possible.

71   Â¥   2011 Oct 30, 8:37am  

Jon137 says

not even in line with annual inflation.

Why does rent have to go up with "inflation"?

The bulk of the cost of rent is mere site value, and that isn't a line item in the landlord's budget.

LL's mortgage payment sure as hell doesn't go up with inflation.

72   corntrollio   2011 Nov 1, 5:39am  

Buster says

We rented a place DT on the Embarcadero as we are new to the city and didn't really know where we wanted to live and didn't have time to visit the city to shop around for rentals. What we rented is nice, but nothing great. It does have a stupendous view of the Ferry Building and overlooks a huge chunk of DT and the SF Bay. Stunning. 600sf, an equally large balcony on the 18th floor and a block to Bart/Muni and the Transbay Terminal. Rent $3200. Rather steep but manageable and I get it for the convenience and view. Tonight I find out that if we choose to stay, our rent is going up to.....drum roll....$5200/month. No lie.

This is partly because of corporate rentals. They are distorting the market a bit in certain locations that are close to jobs.

clambo says

Rents in San Francisco reflect that it is one of the few places where there are jobs, and there is pressure from foreigners to buy/rent there. San Francisco is one of the preferred places to buy for rich Communist Chinese officials who have gotten rich by corruption.

Thanks for repeating talking points, but this is all nonsense. There are far more jobs in the East Bay than San Francisco. The foreigners thing is way overblown, and the "rich by corruption" Communist party stuff is absolute nonsense -- what is your source that this is common?


Hey, SF does actually does have rent control. So how can this guy's landlord raise his rent so much?

New building. Rent control only applies for 1978 or 1979 and older typically, although there are ways to have newer buildings be part of it.

clambo says

no city has the climate to compare with San Francisco.

You really don't spend enough time in San Francisco. San Francisco's climate is not that great compared to other parts of the Bay Area that have shorter commutes to SF than certain parts of SF. SF is usually cold and windy, and large parts of the city are ridiculously foggy.

Jon137 says

SF and NYC are examples of broken rent control. It encourages people to never move, which in turn creates a supply shortage, which in turn drives prices up for newcomers. Basically, new renters are subsidizing the old renters.

Yeah, this is how rent control in SF works. Sometimes you even see people who have lived in an apartment since the 1960s, while they were in college, and now they have grandkids and still live in the same place. This drives up rents artificially because it makes the market illiquid.

There are also many geezer millionaires (stereotypically female heirs) who live in rent controlled places in SF who are abusing the system.

Jon137 says

Either that, or there are a lot of 1%'ers in SF, which is possible.

There are, but there are also tons of relatively poor people (compared to the 1%) in SF too. Median income is something like $70K. There are also plenty of 20- and 30-somethings who are out of college but live in college-like housing situations -- e.g. everyone pays $1000/mo for their room in this house. That drives up rents too.

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