There are Burbed readers outside of the Bay Area – in fact, one gentleman from Virginia donated $25. (You can too!) One question I do hear from time to time: “How do you people afford to live there?”

Now, naturally most people are earning at least $100k + bonus, and many others have stock options. But, let’s face it – not everyone is that fortunate and can be in tech, be police officers, or be bus drivers. Some people work in other industries that aren’t so lucrative.

But the fact is that Silicon Valley residents are known for their perseverance and entreprenurial skills. Let’s look at another example:

County home foreclosures skyrocketing – Inside Bay Area
Antonia Hernandez, 52, saw her monthly mortgage shoot up to $6,883 on a two-bedroom, one-bathroom house in Redwood City that she’s in danger of losing.

It went into foreclosure after the loan on the house reset. Hernandez, a housekeeper, and her husband, a refinery worker, originally paid $4,300 per month in mortgage payments when they purchased the house two years ago. Their combined monthly income is $5,400.

Hernandez and her husband live with six nephews in the house, and may have to walk away from it.

[snip]

The family purchased the house for $775,000 with a subprime loan, and the interest rate adjusted upward. As of February, the Hernandezes stopped making payments because they could not afford them.

Hernandez is working with the group ACORN, the Association of Community Organizations for Reform Now, which is trying to negotiate a loan modification in her behalf.

You see what I mean? In the rest of the country, where there are no smart people or great schools like Sequoia High, people would be like “Whoa… 8 people? How do we fit that in 2br/1ba?” But these are likely the same people who would be asking: “Whuh? The web can be both read and write?”

Now granted, this isn’t as innovative as the 990 sqft East Palo Alto house that had 14 people in it. But still, it’s another fine reminder that if there’s a way, people in Silicon Valley will find it.

<sniff>

I’m getting all choked up. I love this place. Don’t you?

1036 Harlan Dr, San Jose 95129 (Berryessa)
$1,288,000

* Status: Active
* Bedroom: 4
* Bathroom: 2
* Year Built: 1967
* Lot Size: 7344
* Square Footage: 1843
* List Date: 5/20/2008
* Garage Spaces: 2
* MLS#: 810140

Totally remodeled home in the top Cupertino Schools: Dilworth/Miller/Lynbrook(walking distance), double pane windows, granite kitchen/bathroom counters, new maple cabinets in kitchen and bathroom , new flooring through out the house, new paint in&out, gated front door for privacy , beautiful backyard with durable fiber deck, copper plumbing, new light fixture. Quality Dura-style home.

Top congrats to 95129 for continuing to break new appreciation ground, and proving once and for all that there is no slump in the Real Bay Area. Let’s look at the Zillow:

Just look at that! Since the “slump” (which btw is a fiction of your imagination), prices have actually gone up nearly $300k! If you had bought when everyone was saying “OMG, don’t buy”, you would’ve made out like a bandit. This proves that it’s either a seller’s market or a buyer’s market. You simply can’t lose when you buy a house that’s in the Dilworth/Miller/Lynbrook district!

Not only that, but this house is Dura-style much like the famed Ford Duratec engine.

Everyone grows up wanting to live in a million dollar house, to show that they have made it. And if you buy this house today, you can show to to the world that you’ve made it – and not only that, but you’ll be surrounded intimately by other millionaires:

What? Don’t tell me you’d rather live like those phony millionaire savages do-nothing-hedge-funders in Connecticut do:

Gah, talk about anti-social.

UPDATE: Readers like mrbogue have pointed out that if you buy this house, you will also solve our smog problem! Just check out the sky this house comes with:

Too bad this new sky will eat your trees…

Strangely enough… it appears that sometimes WP-Supercache causes this site to not load…

Update 1: Caching is now disabled. Site loads. WTF.

79 WINDING Way San Carlos, CA 94070
Price: $719,000

Beds: 1
Baths: 1
Sq. Ft.: 670
$/Sq. Ft.: $1,073
Lot Size: 6,930 Sq. Ft.
Age (Years): 49
Year Built: 1959
Type: Detached Single Family
Style: Cabin
Stories: Bi/Split Level
View(s): Bay, Mountains
Neighborhood: Beverly Terrace Etc.
County: San Mateo
MLS#: 782686
Source: MLSListings
Status: Active
On Redfin: 73 days
Idyllic country setting nestled quietly between million dollar homes in sought after San Carlos Hills. Magnificent views; 7,000 sq ft lot w/ endless development potential. Country Style living, conveniently located to downtown San Carlos. Open House this Sunday 05/04 1:30-4:30

Wow… it looks like Hurley, Ben, and John could’ve simply come to San Carlos to find Jacob’s Cabin. Heh.

But seriously, I’ve always wondered about San Carlos. It’s tiny, there’s not much to be known about this city, so I’ve always had reservations about whether San Carlos, The City of Good Living, is Real Bay Area or not.

Well, this house simply seals the deal. $1073 a square foot? Wowzers. This is Palo Alto territory. And look at the giant plot of land you’re getting – nearly 7000 sqft.

Congratulations San Carlos. Welcome to the club.

BTW, to the next owner: might I suggest building a zip line? That’d be kind of neat!

Palo Alto Online Palo Alto Weekly: Who Palo Alto’s 2,860 homes are planned for (June 11, 2008)
Who Palo Alto’s 2,860 homes are planned for

690 homes: very low income (less than $53,050)

543 homes: low income ($53,050 and $84,900)

641 homes: moderate income ($84,900 and $126,600)

986 homes: above moderate income (more than $126,600)

* Income for a family of four

Honestly, if you don’t make at least $84,900 for a family of four, you really shouldn’t be allowed to live here. There should be some sort of income police that checks your W2′s and 1099′s, and has the power to forcibly relocate you to Vallejo or Gilroy if you don’t meet that criteria.

Don’t take it personally. It’s all about protecting community.

Mountain View Voice Mountain View Voice: Letters to the Editor (June 13, 2008)
‘Affordable housing’ bad for quality of life

Editor:

My wife and I moved to Mountain View 40 years ago because of the quality of life. Now, after making mortgage payments for 30 years, our home, our largest asset, is being threatened. Advocates of “more affordable housing” want to turn Mountain View into a place of multi-family tenements.

If I wanted to live in a slum, I would move there. Instead I chose to live in Mountain View. I say if affordable housing supporters want to live in a high-density slum, so be it. However, don’t turn Mountain View into a slum.

Konrad M. Sosnow

Trophy Drive

Well said! Bravo! It’s time the Real Bay Area took a stand against against affordable housing. The more affordable housing becomes, the less special it becomes. Let’s fight back!

Cheers to Konrad for having the courage to make this statement! By the way, Konrad paid just $2203 in property tax last year, while some of his neighbors probably pay $13,000. Which makes sense since Konrad paid $106,500 for his house in 1977, and other people in his area just paid $1.3 million.

Now if only we could get rid of some of the jobs that Mountain View has. That’s clearly the biggest problem.

Pair arrested on charges of running brothels in Cupertino, San Jose – San Jose Mercury News
The bust last week of two alleged brothel operators accused of setting up shop in Cupertino and San Jose was the result of months of careful investigation, Santa Clara County Sheriff’s Department officials said today.

Deputies arrested Man Hing Tam, 43, of San Francisco, and Ying Ting Lam, 43, of San Jose, on June 5 after a four-month investigation.

While brothels aren’t uncommon in Santa Clara County, investigating them can be difficult because owners tend to move their base of operation often, Sgt. Mike Paresa said.

“We often find out that they stay in a place for two months or so and then move,” he said.

In this case, deputies believe that Tam and Lam worked together running a brothel in two different locations around Cupertino – first on Via Paviso and then near the city’s border with San Jose on Buckingham Road.

But more importantly:

Paresa said about five women allegedly worked as prostitutes for Lam and Tam. Investigators do not believe that any of the women were forced into prostitution or were sex slaves.

This is another example of government interfering with Silicon Valley entrepreneurship! Haven’t they heard? This is Brothel 2.0!

What really disappoints me is that this took place in townhouses. I was sure that this was what was going on in this house:

(Thanks to Madhaus for the find.)

Technology for Real Estate Professionals: Web: Walmart Joins Online Listings Derby With FREE Classified Ads
In fact, a search for all classes in 95125 returned 646 listings on Walmart classifieds, including an astounding 318 foreclosures. I have been reading about “shadow inventory” on the bubble blogs, but this is the first time I’ve found so many foreclosure listings in one place. I checked mlslistings.com, the public face of the MLS for Santa Clara County, and they had 341 listings in 95125. Zillow only returned 46.

Well that’s mighty peculiar. Any one know the full story behind this?

It’s Friday the 13th! And in honor of this day, let’s take a look at what could happen if a streak of bad luck happened to us – Austin, TX and cheap housing:

4508 Sharpshinned Hawk Cv
Austin, TX 78738

$500,000
4 Bed, 3.5 Bath
3,365 Sq. Ft.
0.24 Acres
Estimated Payment:

$2,337 Per Month*
Single Family Property, Area: LS, Subdivision: Spillman Ranch, Falconhead, County: Travis, Approximately 0.24 acre(s), Year Built: 2003, Golf course view, Two story, Central air conditioning, Fireplace(s), Dining room, Office

This, my friends, is the kind of nightmare that the Bay Area may become if we don’t all do our parts to keep house prices high. Think about it – if you could buy a house like this in the Bay Area for $500k, what incentive would you have to continue to work and foster the amazing innovations that Silicon Valley is famous for.

No, you’d probably become fat, lazy, and do nothing but sit around and eat Amy’s Ice Cream all day like they do in Austin. Austin defenders will point out that they have a tech industry there – just look at Dell. Do that, I say “Yeah, just look at Dell and how they’re falling apart compared to HP.” The only reason HP is succeeding is because of their top talent here in the Bay Area.

Do you want to be around only healthy skinny people? Bay Area.

Do you want to be around only smart and well educated people? Bay Area.

Do you want to get paid insanely great salaries and have amazing stock options that will make you rich? Bay Area.

Do you want access to sushi and great food – not just grits and ‘Q? Bay Area.

Do you want to enjoy 400 days a year of great weather? Bay Area.

Do you want cheap mansions that will make you fat, dumb, poorly paid, pay low taxes, and die in the heat? Austin.

’nuff said.

(Note to Austin readers: I’m sorry for the harsh words. But your cheap housing really disgusts me. That said, Amy’s ice cream was pretty awesome. The fact that you can get it at the airport is great too.)

Glassdoor.com reveals why Bay Area Real Estate is affordable. [Burbed.com]
San Mateo Home Sellers in Trouble Says:
June 11th, 2008 at 5:12 pm

LOL at polygamy comment. Anyway, I graduated from Berkeley. This year’s students are indeed getting 90k at some places. I know a guy starting at 90k at VMWare, and another guy getting 95k at yahoo. The yahoo guy has a masters though. Both of them are Berkeley guys. On the other hand a guy who got a masters from Arizona state went to Google and got offered only 70k. As for me I made 94k last year including bonuses but I’ve already worked for 2 years. Even though I think my salary doesn’t suck for a 24 year old, a 800k median San Mateo house is too ridiculous.

Although SMHSIT didn’t ask for it, here’s my advice: Buy that $800k house asap.

Here’s my reasoning: sure when you turn 30, you’ll easily be clearing $141k base, $160k after bonus (I’ll ignore stock for now, though that’s probably double.) And sure by then you’ll probably meet your fine Mr./Mrs./Partner in the office. Hey suddenly you now have $320k! Times 5? BOOM. You can afford at $1.6m house in 2014. Just look at a $1.1m house today to see what you’ll be able to get then. (Appreciation happens.)

But… but… what if you don’t meet the right person? Let’s say you end up with… well… an undesirable. Someone who adds no value to tech, isn’t part of Web 5.0, or the Greentech 2.0. Someone who really doesn’t need to live in the Bay Area. What if you end up with a public school teacher? It doesn’t make sense, but love can do that! Well then you’d only be making $210k which would only afford you a $1m house in 2014. And that’s assuming that salaries don’t go down in that doomed and dying industry. That’s a $740k house today! Ouch! That’s worse than a $800k house today!

That’s why it makes complete sense you should go buy a $800k house right now asap. Sure that’s 8.5x your income, but can you afford to take the risk of being priced out forever? Just tell the lender, “Look, I’m investing in Real Bay Area Real Estate really. And, in just 6 years my income will grow 70% – and that ignores stock. What could possibly go wrong? Can you afford not to bet on me?”

You’ll thank me for this SMHSIT.