1. This site uses cookies. By continuing to use this site, you are agreeing to our use of cookies. Learn More.

Speaking Of House Prices...

Discussion in 'The OT' started by Rich, Oct 28, 2017.

  1. Rich

    Rich DBSTalk Club DBSTalk Club

    28,606
    680
    Feb 22, 2007
    Piscataway, NJ
    Just looked at Sacramento. Saw some homes I would be interested in. Thanx, that clears things up a bit.

    Rich
     
  2. phrelin

    phrelin Hall Of Fame DBSTalk Club

    15,112
    331
    Jan 18, 2007
    Northern...
    Be somewhat cautious about homes in the Sacramento region. There are a surprising number of homes in areas where only levies separate them from total flood loss. Think New Orleans....

    On the other hand there are some great neighborhoods.
     
  3. billsharpe

    billsharpe Hall Of Fame

    2,758
    80
    Jan 25, 2007
    Southern...
    You don't have to be wealthy to live in Venice or Santa Monica. You just needed to buy there in the 80's or earlier. We moved there from Connecticut in 1959 to a rented apartment, rented a house in 1960, and purchased a house in 1961. Best investment I ever made, although my IRA is close behind. I started with $142k in December 1989 when I retired. I have now taken out over $500k, and there is still over $500k in the account. Although my net worth is high I do not consider myself wealthy. Annual income is well under $100k.
     
    Last edited: Nov 6, 2017
  4. Rich

    Rich DBSTalk Club DBSTalk Club

    28,606
    680
    Feb 22, 2007
    Piscataway, NJ
    Makes me wonder how "wealth" is now defined. I'm in the same situation.

    Rich
     
  5. phrelin

    phrelin Hall Of Fame DBSTalk Club

    15,112
    331
    Jan 18, 2007
    Northern...
    "Wealth" is always defined comparatively. We compare our current situation to what our expectations were and/or to what others have, all to determine how satisfied we are.

    What gets confusing is determining what "wealthy" is. Since neither my nor my wife's name are on any one of the Forbes lists of wealthiest people, I'm pretty sure we're not "wealthy." [​IMG]

    On the other hand, on a day-to-day basis we have enough money to do pretty much what we want to do without any sense of imminent danger of falling into poverty. Barring some international economic collapse or personal tragedy, we likely will leave some modest estate to the "kids."

    Home ownership is the most confusing part of wealth determination. Frankly, I don't consider our house "wealth" in the traditional meaning. I don't know what it will be worth tomorrow on the market, Zillow notwithstanding. In December 2007 it would have been worth at least $600,000 in our estate. In December 2008 it would have been worth at least $160,000 in our estate.

    The best I can determine is that taxes, insurance and maintenance cost on average around $500 a month. That's at least $800 a month less than what rent would cost. I'd have to have $800,000± in CD to generate that income after taxes. But there are other moderately stable investments which would return that $800 a month on $240,000. So whatever home I owned right now would be worth somewhere between those numbers to me. Still, we don't know what it will be worth in our estate after we're dead.

    Since I don't feel deprived because of lack of money, I figure I've got enough "wealth." I do have a great "abundance" of the important things in my life, most of which I cannot place a dollar value on.
     
    Rich likes this.
  6. dmspen

    dmspen Hall Of Fame DBSTalk Club

    1,665
    45
    Dec 1, 2006
    Los Gatos,...
    Something to consider...the average tech manager in San Mateo County (county immediately south of SF) makes $330,000/yr. Plenty of income to buy a house here. This is the area with Apple, Google, Facebook, LinkedIn, and a whole slew of others. I work directly across the street from HP, around the corner is Tesla, Nest, and the list goes on.

    These people really skew the average income.

    The City of Palo Alto recently developed a plan to try and keep teachers, police, firefighters, etc. Jobs/people that are not highly paid but essential. The result: If you make less than $250,000/yr, you can get subsidized housing. The average Palo Alto house price is $2,695,000. That's a lot of subsidizing.

    A recent rental report showed 2 bed 2 bath apartments in Cupertino (Apple's Home) averages $5040.

    It's all ridiculous.
     
  7. Rich

    Rich DBSTalk Club DBSTalk Club

    28,606
    680
    Feb 22, 2007
    Piscataway, NJ
    Yup. How do kids starting out buy a home, that's what bothers me. We know a recently married couple, friends of my son, a teacher and a hair stylist. They've been looking at homes here and can't afford a "decent" place, how would they fare in CA? All the "decent" homes I've seen here are less than $500,000. They have a kid on the way, their financial situation is just gonna get worse. Not much money for a down payment, nothing but problems. I have no idea what their combined income is...not all that much, I know that.

    Rich
     

Share This Page