May 13, 2006

Santa Clara's Poverty problem

MercuryNews.com | 05/11/2006 | Study: State is one of poorest in U.S.
Critics have long complained that the federal government uses an outdated formula to calculate the official poverty standard, which determines individual eligibility for welfare and other programs, and is also used by the federal government when it allocates money to state and local agencies.

The formula is based on income levels and the cost of food, but does not take into account housing costs that vary greatly from one region to another, said Deborah Reed, who wrote the PPIC report.

For example, the federal poverty level for a family of four in 2004 was $19,157. But the U.S. Department of Housing and Urban Development estimated that fair market rent for a two-bedroom apartment that year in Santa Clara County was $21,852. That means a family earning $20,000 was above the poverty level, yet potentially homeless.

“There are people living just above the federal poverty level in California who are not doing as well as people who are officially living in poverty in Mississippi and Louisiana,” Reed said.

Using the official federal standard, California has the 15th-highest poverty rate in the country, with 13.3 percent of its residents living below the poverty threshold.

But when Reed adjusted the formula to reflect the cost of housing, California’s poverty rate rose to 16.1 percent. That gave it the third-highest ranking in the country, Reed said — behind only Washington, D.C., and New York.

Using Reed’s calculations, 15 percent of Santa Clara County residents live in poverty, compared with 12 percent nationally.

Wow… I never thought about this. :(
I love how people say “Oh, other than the cost of housing, living in the Bay Area isn’t that expensive.”

Does that make sense to you? Isn’t that like saying “Oh, other than the radiation, it’s pretty safe here.”

Click here to post a comment -- Posted by: burbed @ 5:00 am






May 12, 2006

Congratulations to Salinas, Santa Cruz, and Santa Rosa!

The Least Affordable Place to Live? Try Salinas – New York Times
IN 2005, the least-affordable place in the country to live, measured by the percentage of income devoted to mortgage payments, was Salinas, Calif.

The second was the Santa Cruz-Watsonville area of California.

The third? Santa Rosa-Petaluma, Calif.

In fact, California has the distinction of having the 11 least-affordable metropolitan areas in the country. One would need to go all the way down to 12th place — and across the country to the New York region’s northern suburbs — to find a non-California metropolitan area on the least-affordable list of 2005.

Congratulations! And why is California so unaffordable? Is it because it’s the most special place on earth?

Another quintessentially California issue is Proposition 13, the 1978 measure that slashed property taxes by more than 50 percent and ignited a national property tax revolution.

The measure, which was supposed to facilitate home buying, has backfired to some extent; local governments prefer that land be used for retailing rather than housing because they collect more from sales taxes than from property taxes.

“Proposition 13 is a big stop sign saying ‘no housing needed,’ ” said Peter Dreier, professor of public policy at Occidental College in Los Angeles and an author of “Place Matters: Metropolitics for the 21st Century” (University Press of Kansas, 2001). “Every municipality is engaged in a bidding war for retail — they’re battling for Wal-Mart, to keep the libraries open.”

It is unlikely that will change, Professor Dreier and others say, calling Proposition 13 “the third rail of government — it’s untouchable.”

Maybe they can build dual purpose Best Buy’s – stores during the day, houses at night. Then, instead of having a Best Buy every 5 miles (East Palo Alto, Mountain View, Sunnyvale) – we could have one every block. Everyone wins!

Click here to post a comment -- Posted by: burbed @ 5:00 am

May 11, 2006

$697,000 for a meth "super lab" in East Palo Alto

So I saw this article the other day:

EAST PALO ALTO / Hospital setup found during meth lab bust / Medical tools may have been intended for injured criminals
An East Palo Alto home where police found a “super” drug lab last week also housed an elaborate hospital-like operation — stocked with thousands of dollars in medical equipment, surgical tools and supplies — that authorities believe was to be used to treat injured criminals.

The top floor of the Runnymede Street home was filled with “boxes upon boxes upon boxes” of medical supplies and contained a room equipped with a hospital bed, fresh linens, scalpels, IV stands and surgical tools, according to Lt. Tom Alipio of the East Palo Alto police department.

“It was set up just like a hospital room,” said Alipio, who said a second room was in the process of being set up. “We found a kit that a surgeon would use to reassemble a joint — like a hip or a shoulder.”

So I found myself wondering… “Gosh! How much does a meth super lab/hospital cost these days?” Fortunately, with some simple sleuthing, I was able to find the address and this ZEstimate:

Zillow.com – xxx Runnymede St, East Palo Alto, CA 94303
MethLabRunnymede.jpg

Residence: Single family
Bedrooms: 2
Baths: 1.0
Total rooms: 5.0
# Stories:
Sq ft: 760
Lot size: 18,768 sq ft / 0.43 acres
Year built: 1935

Hey! Wow… 760 sqft sounds small. Fortunately, the article provides more details…

Alipio, who said the items appeared to have been stockpiled to treat gunshot or chemical wounds, said everything appeared brand-new, but he couldn’t be sure if the room had been used to treat any patients.

Alipio said he was stunned by the sheer volume of the items, which he said would fill a semi-trailer truck.

“This goes above and beyond the taking of a garbage bag or a bottle of soap,” said Alipio.

Investigators said wounded criminals could use such a place to avoid going to regular hospitals, which are required to report suspected criminals to authorities.

The room and supplies were discovered in the upstairs front unit of a house that had been divided into three units and also contained a drug lab that had been fortified with concrete cinder blocks, steel doors and metal bars. The entire property had been wired with an elaborate security camera system that police said was not being monitored at the time of the raid.

A single mother of five young children had been living in the back of the home at the time of the raid but was not connected to the drug operation, police said.

Hey! That sounds like a lot of livable space! And its prewired for security! Keep your eye out for this jewel when it shows up in court. Could be a good buy!

Click here to post a comment -- Posted by: burbed @ 5:00 am

May 10, 2006

Nation's Highest Median Income: Santa Clara at $97,100

Region’s median income on the rise – Sacramento Business Journal:
Median family income rose 3.15 percent over the past year in the Sacramento area, based on Department of Housing and Urban Development figures for 2006.

Median family income for the Sacramento Metropolitan Statistical Area is $65,400, up from $63,400 in HUD’s 2005 estimates.

The median means that half the households in the region make more and half make less.

The highest median-income metropolitan area in the country is San Jose-Sunnyvale-Santa Clara, with a median income of $97,100, up 3.4 percent from the previous year. The second highest in the country was Bridgeport-Stamford, Conn. which had a median income of $95,900.

The median income in San Francisco-San Mateo-Redwood City was $91,200. Santa Barbara-Santa Maria’s median income is $65,800. The median in San Diego-Carlsbad-San Marcos was $64,900.

Wow… a median income of $97,100. No wonder real estate is so expensive. Maybe prices will never fall!

Click here to post a comment -- Posted by: burbed @ 5:41 pm

Debt! It’s better than working!

I keep seeing that real wages have held steady or have fallen in the last few years – yet people are living better than ever. What’s going on? Where is this money coming from (when not from Asia, anyway)?

Sonoma Housing Bubble
“A decade ago, I remember my mother telling me that after nearly 20 years of residing in their home, which my father had designed and built for about $75,000, my parents had a mortgage of over $500,000.”

“What happened?” I asked my mother disapprovingly.
She waved my concerns aside. “This house is a bank,” she said. “We’ll never pay it off.”
A bank?

“After that, I could never think about our lives in quite the same light. My parents were self-made. They were from poor, working-class families with five and eight siblings, and had put themselves through college, worked hard, and never got a dime from any parent or grandparent, dead or alive.”

“But suddenly I realized that their college educations and hard work might not have been enough to cover certain … luxuries.”

[snip]

“Lynn Ruth Miller, who bought her Pacifica home for $97,000 in 1985, is living on the equity from her house and investing part of that money to get earned income.”

“I could not survive if I didn’t do that because my fixed income is $720-plus a month,” she wrote. “Because of the rise in property values I am living very comfortably and could not possibly pay my bills otherwise.”

“Some even factor the monthly payments of the equity line into the equation. My mortgage broker, Michael Simmons, once had a client who took out a $500,000 equity line to pay for her elderly mother’s home care and the monthly payments of the equity line itself.”

“Geoff Caldwell of San Francisco, used an equity line to avoid expensive dormitory fees, by buying a house for his daughter to live in during college.”

Edward Malouf of Novato funded a condo for his son. “We paid all cash for it, and our son made every payment, as agreed,” he explained. “Because of this, we allowed him to keep the appreciation when he sold the condo, so he could buy a larger, three-bedroom one.”

“Equity lines and second mortgages haven’t always played such an integral role in American life. In the old days, taking out a second mortgage or an equity line had a certain stigma attached.
“It meant you were the sort of person who couldn’t pay your bills — that you were living above your means,” Simmons explained. But over the past 20 years, he’s seen things change.”

Indeed, treating the home as a bank has grown naturally out of a sea change in our attitudes about debt. Once, credit cards also carried a stigma; now they are ubiquitous in all classes of society. As more and more people began to pay exorbitant credit card interest rates, equity lines — with their relatively low interest rates — suddenly looked downright practical.

[snip]

“Say you have a house that’s worth $1.3 million. Is it a reasonable expectation that you’ll ever pay it off? Probably not. The most people hope for is that someday they’ll sell it for a profit or leave it to the kids, who might have to sell it but will maybe make a little money.”

[snip]

Ten years ago I was horrified by my parent’s use of our family home as a source of cash, but now I see things differently. Would it have been better to have paid off the house and lived mortgage free? Maybe. But going that route would surely have meant curtailing their choices earlier — never giving their kids college tuition, or working extremely long hours, or having to get corporate jobs instead of working for themselves.

Oh crud… this is what my mortgage broker friend has been telling me for a while. I guess I was all wrong after all.

Click here to post a comment -- Posted by: burbed @ 5:00 am

May 9, 2006

Someone beat me to this photo!

I actually drove by this the other day, and wanted to take a photo because it was so funny. Unfortunately, I didn’t have my camera on me. Fortunaate

The Housing Bubble Blog Photo Gallery
0/65 Sunnyvale, CA (Fair Oaks near 101) — Nine condos for sale. One flyer lists a 2BR / 2.5BA for $575,000. Don’t forget the $265/mo HOA dues!

fairoaks.jpg

Yeah it looks like some places are available for sale there!

Click here to post a comment -- Posted by: burbed @ 5:00 am

May 8, 2006

Shocker! Selling houses means doing work!!

The Housing Bubble Blog
“Jamie Granada, a real-estate agent in Stockton, is relatively new to the field, launching her new career in January. ‘Now you actually have to work hard to sell,’ she said. ‘It’s to my advantage to be new.’ Buyers know it’s a buyer’s market, she said. ‘They’re in the looky-loo mood, trying to see what kind of deal they can get,’ she said.”

“Dale Gray, CEO for the Central Valley Association of Realtors, said that not only are most sellers shocked by this slower market, so are many real-estate agents. ‘You can’t just throw in on the wall and know you’ll get multiple offers in a few days,’ he said.”

Wow, I bet these people had their reality totally shattered. What? Selling a house means actually doing work to get paid?

Will Real Estate Agents start to have bumper stickers that say “Please, just one more bubble!” as well?

Click here to post a comment -- Posted by: burbed @ 10:28 pm

Great Moffett Air Show Views*! $309k to feel the roar!

MLSlistings Property Detail for MLS number 617868
650 ALAMO CT #022
Mountain View, CA 94043

60alamo.jpg

$309,000
Homeowners’ Association Fee:$207
TOP FLOOR END UNIT W/MOFFETT AIR SHOW VIEWS!!
Don’t miss this top floor end unit 1br condo located close to downtown Mountain View. Views from both the living room balcony and bedroom balcony. Convenient to Highways 101,85,237 and 280. Backs up to Stevens Creek trail, close to shopping, and parks. New copper plumbing installed throughout this 22 unit complex. Neat and clean condo. Upgraded bath with newer vanity and shower door. New paint and mirror closet doors in bedroom. Neat and clean home. Don’t miss the opportunity for ownership in Mountain View real estate.

This Condominium has the following features:
MLS#: 617868 Approx Age: 22 Years Approx Sq Ft: 578
Condominium 11-25 Units Low Rise (1-3 Stories)
Contemporary 1 Level Top Floor or Penthouse Unit

Wow! Just think if the money you can save by not having to buy an air show ticket and parking. Maybe you can even see the SOFIA 747 research plane land at night.

Feel the rumble! See the Jet-A smoke! All yours for $309,000 for 578 square feet!

(*The Air Show was cancelled forever in 2005.)

Click here to post a comment -- Posted by: burbed @ 5:00 am

May 7, 2006

San Francisco: 2,700 New Condos On Sale Soon

SocketSite™: 2,700 New Condos On Sale Soon
2,700 New Condos On Sale Soon

Thank a change in state legislation (allowing for 3% non-refundable pre-construction deposits) for the boom in new development sales centers slated to open this spring/summer. One such sales center, the 9,000-square-foot, $2.5 million sales center for One Rincon Hill, will feature “a fully appointed, two-bedroom model apartments [sic] with lightboxes simulating views both night and day.”

In total, sales centers representing at least 2,700 new condos should open within the next six months. Included in the mix:

170 Off Third – 198 condos
255 Berry (open) – 99 condos
The Arterra – 268 condos
Broderick Place (open) – 70 units
The Hayes – 128 condos
The Infinity – 650 condos
One Rincon Hill – 695 condos
The Palm (open) – 300 condos
Park Terrace – 110 condos
SoMa Grand – 246 condos

Wow, that’s a lot of condos coming online!

Click here to post a comment -- Posted by: burbed @ 5:00 am

May 6, 2006

Negative Mortgage – Negative for your Health

cbs13.com – Call Kurtis: Negative Mortgage
Leslie and Rob McDonald have the family sanctuary they’ve always wanted in their Modesto home. But this happy life now goes on under a shadow.

“I didn’t understand what we were signing. A lot of embarrassment, a lot of stress. My husband, well he’s actually begun having heart problems now, because of it,” says Leslie McDonald.

It is a tricky kind of home loan called a negative amortization mortgage. It’s a kind of adjustable rate loan that allows you to keep your interest only payment the same for a guaranteed period as interest rates rise. But in the end the small payments don’t cover the rising cost, and the difference is added to your mortgage balance, pushing you further in debt.

“We’re losing about a thousand dollars a month in equity in our home,” says McDonald.

Oops! Considering that the Bay Area leads in this type of mortgage, it really makes you wonder…

Click here to post a comment -- Posted by: burbed @ 5:00 am