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Great summation.
Yes, so much of the Bay Area was built out into the 70's.
My years in San Jose were 1969-1998, a few days before 1999.
So much has changed, for the negative, in the seven years I've been in Phoenix. Many businesses are outsourcing, or outright moving to NV, TX, or AZ. Philips moved their A/R and other operations out here. The employees were told they could come to AZ or quit their jobs. Apple moved a lot of stuff to TX in the 90's. Intel in out here big time.
I hope there is a correction, there must be one coming. A couple of hundred new millionaires at Google cannot sustain the millions and millions of average workers trying to squeeze out a middle class lifestyle.
Silicon Valley was always a little more expensive than other places, but not excessively beyond median incomes in average areas like southwest San Jose.
I still long to go back to the good old days of the 80s, but I guess your really can never go back home. I went back for a couple of days in July after a four year absence. So much has changed while much has remained the same. San Jose fit like an old glove after a few hours of driving around to see my old haunts. Oakridge Mall is TOTALLY different and modern...almost alien looking from the original. It's as if someone dropped it in from outer space. That K-mart at the Intersection of Blossom Hill and Santa Teresa Blvd. is now a Kohls...etc.
IBM is now Hitachi/IBM, etc.
I don't know what else to say about a 1,400 sq. ft. stucco house selling for $750k other than I want to cry.
At least I'm the first poster...
Happy New Year!
Great and honest posts today.
Here's an interesting article by a black talk show host who's a mechanic
in South Central Los Angeles. His name is Terry Anderson.
His talk show comes on after mine, here in Phoenix on KFNX Sunday nights. You can listen live via the web.
How about 4-7 families moving in to share a house next door to yours?
How about your next door neighboors harvesting corn in their front yard...third-world style?
This is not America.
Actually, the article is not BY Terry Anderson, although it mentions him.
I stand corrected.
Anyway, interesting article.
And yet another interesting article on the French Riots in the same
magazine.
Click here: http://www.amconmag.com/2005/2005_12_19/cover.html
The article is entitled FRENCH LESSONS.
Same link but home page.
Hap Hap Happy New Year All!
Southsiders (Suze Orman included) didn't want this year to end! It is now 2006, and with it, ominus realities. While I hope it's not another 88 years until we have something, anything (1959 AL Champs) to celebrate I do believe that 2006 will go down as the year of the "reckoning"! One of the articles Patrick posted blandly observed that "there is nothing left to do but to sit back and watch". MAN! This is GUHRAND! I'm savoring this more than waiting 46 years to wear a White Sox ball cap without getting grief! Yes; all good things in time and yes, all "crash" fans will be WELL rewarded! Mind you BULLS, this is not the same as the guy on the street corner waving a "THE END IS NEAR" sign. You no doubt will be eager to point out that yes, eventually, even this bum will be right. You won't have to "haunt" Vegas to see subdivisions unfinished. Ya see BULLS, being a builder is risky even in the best of times. The meter is ALWAYS running. Bridge Loans don't have sick days. When "in-fill" and smaller builders can't move inventory their first concern will not be "Mister You can't go wrong with RE"! It will boil down(rather quickly) to saving their own hyde. There will be NO friends during the crash. Realtors (TM) will turn on buyers, sellers, their employers and yes, their own young! Mortgage brokers will turn on their lenders. Borrowers will turn on brokers and "appraisers" and this whole thing will look JUST LIKE Elliot Spitzer and his "Witch Hunt". Everybody looking for someone to blame! Unlike the "Tech. Wreck" which seemed to unravel before you could say SELL!, The RECKONING will be televised! In glaring, harsh, unflattering and protracted light. Enjoy.
Umm... can we talk a little bit about real estate bustage and stuff, or is that too boring? Like, the factors that could make the bust worse in the Bay Area than anywhere else? :-)
newsfreak says (in part and poetically, though wrongly blaming Bush) that:
"Until America becomes
post post-modern
and uses solar, wind,
invents new better,
and boots out
the fanactical fundamentalist
old world order
20th century Bushites,
we will continue to attract
many who come to consume..."
Actually, the forces of the old world order
are the forces of sanity...not the forces of
whole wheat toast, Grapenuts and nude beaches.
As for the term post-modern, it's merely a euphemism for nihilism.
The trend in towards cultural desolation and tribalism as witnessed by
today's youth sporting nipple, nose, and tongue rings, odd winged-tatoos
prominently displayed on the edge of girls' butt cracks, ass haning out of their holey jeans, chicks pulling down the front of their pants as far as they can get away without revealing their packages, as seen on the cover of every other magazine at the grocery checkout stand, are all post-modern (nihilistic) trends...
This is the reductio ad absurdem of the 60s-era/Baby Boomer/
Ben and Gerry's Ice Cream/Greatful Dead/hippy-ass/"it takes a global village"/Bonged-out Boomer crowd, of which the Clintons are the patron saints.
Just more flotsam, jetsam and liberal death wish gibberish...
Suicidal if you ask me...
Peter P
2006 Jan 1, 6:23am
I see the same behavior among chinese, turkish & Korean immigrant tech workers/managers. US-born or raised folks of all ethnicities are a world apart, and working with/for them is highly enjoyable. This is really quite a conspicuous issue for me on a daily basis.
It is a culture/class issue. More like Great Mall vs Stanford Shopping Center.
When it come to real estate, these Indians want to buy all homes in Cupertino and Palo Alto, and drive the home prices even higher.
I do not like to see that happen, but it is free market at work.
Peter P
2006 Jan 1, 6:27am
American workers and small business owners are already under pressure from American Big Business. Why should we also be subject to competition from these foreign intrests.
The tide of globalization is unstoppable. Either cheap labor comes here or employers will have to hire cheap labor elsewhere. Which would you prefer?
Blame airplanes, the internet, and the global financial system.
Comments 1 - 12 of 44 Next » Last » Search these comments
I think the extent of the real estate bust in the Bay Area will surprise even the pessimists. In addition to the ubiquitous effects of the bursting of the credit bubble, there are a few fundamental factors unique to this area that are all becoming relevant or more powerful at the same time: now.
- the demand overhang is becoming much smaller. I have only anecdotal evidence, but in 2005, the last renters at my workplace have finally caved in and bought. Some bought "before it's too late", but for many, the ultimate trigger was that they married, the babies were coming, and the yuppie life had to come to an end. Life goes on, after all.
- jobs are still leaving the area. There's continuing consolidation in the local industries, in addition to outsourcing. Being present in the Bay Area is just not worth the cost anymore for some employers.
- as soon as the fear of collapsing house prices will start to materialize and the green spots on the weekly SJ Mercury RE appreciation map spread, many of the substantial number of unemployed or "underemployed" folks who have been hanging on by their fingernails and their home equity in the last 5 years will finally pull the trigger and try to sell. Some because they have made the decision to do so, some because they have to.
- people who could afford to live here start facing the grim reality - that quality of life around here ultimately stinks because of the high cost of living, even though the sun is still shining bright and the mountains and the ocean are really purty. Some of these folks will pack up and leave.
- most of the valley was built out in the 60s and 70s, and the original owners are now old. They or their heirs will sell their houses over the next decade, which will generate that "extra something" in supply that's been missing so far.
- last but not least, the super-low interest rates were coming to the rescue just as the Bay Area was about to correct for the local real estate excesses created in the internet bubble era. So the anxiously expected correction never happened, and that gave buyers that extra "it will never go down" psychological boost, allowing even more outrageous levels of overvaluation.
What do you think? Are these factors significant? Which positive factors could outweigh the negatives? Which ones of the negatives are relatively weak, which ones strong?
Or could it be just like in 2001 - a painful, but short episode of slow sales, high inventory and moderately falling prices, and then it's back to business as usual?
#housing