August 23, 2008

California has the most milionaires!

The Wealth Report – WSJ.com : Florida Beats New York for Millionaires
According to new wealth stats released by the I.R.S. Florida had 199,000 residents with a net worth of $1.5 million or more as of 2004 (their latest period). That topped New York’s count of 168,000, though it still trailed way behind leader California, which boasted 428,000–more than a fifth of the nation’s total.

BOOM! We beat New York. Which in turn beat Florida. BOOM!

House prices out of whack in this state? Are you kidding? With so many millionaires, how can prices not be high? It’s a simple matter of supply and demand. And guess what – all these millionaires want to live in the Real Bay Area. Mountain View, Cupertino, Half of Sunnyvale – millionaire magnets for sure.

Booyah baby!!

Comments (48) -- Posted by: burbed @ 5:18 am

48 Responses to “California has the most milionaires!”

  1. Marty Says:

    Mega-booyahs right back at you baby!

    But was that post tongue-in-cheek or not?

    The supply & demand point is right on, but only a fraction of CA millionaires reside in the BA. However, for real millionaires, the RBA is more like Portola Valley, Woodside, Los Altos Hills, North Palo Alto, Atherton, Hillsboro, Seacliff, Belvedere, and so forth.

    Sunnyvale? Mountain View? Cupertino? Come on man, those are overpriced working class ‘hoods!

  2. burbed Says:

    Nearly every homeowner in the RBA is a millionaire – they own a home in the RBA.

  3. DreamT Says:

    Where can I buy one of those millionaire magnets? I’m somewhat cash-strapped and could use one of them.

  4. Herve Says:

    > However, for real millionaires [...]

    Real Bay Area
    Real Cupertino Schools
    Real Palo Alto (94301)
    And now Real Millionaires.

    I love it. For every statement “xxx is yyy” we get the new axiom “real xxx is not yyy”. Get real! :-)

    I agree with Marty though: Sunnyvale, Mountain View and Cupertino are for the most part working class neighborhoods.

    And burbed, if you say “Half of Sunnyvale” you might as well also say “a third of Mountain View”.

  5. DreamT Says:

    Herve – We’ll just have to resign ourselves to the fact that we are Grey Millionaires.

  6. Marty Says:

    > Nearly every homeowner in the RBA is a millionaire – they own a home in the RBA.

    Owning a $1.1M mortgage on a $1.2M home does not a millionaire make!

  7. DreamT Says:

    Marty, it was sarcasm

  8. anon Says:

    Try dollar Menunaires.

  9. rick Says:

    All those millionaires want to live in RBA? I thought they became millionaire because they lived in RBA.

  10. Herve Says:

    > I thought they became millionaire because they lived in RBA.

    From the article:

    About 40% of the net worth of California’s million-and-a-halfers was in real estate in 2004. Florida’s was slightly more than 20%, and New York’s was slightly less than 20%.

  11. Herve Says:

    Russia billionaire buys world’s most expensive villa.

    Now that takes overpriced real estate to a whole new level!

  12. madhaus Says:

    I would love to find some stats on what % of real estate is owned outright (as opposed to owned by the bank) in the RBA zips. Remember that NY Times article I mentioned a few days ago that said more than half of all real estate is still mortgaged, for the first time EVER? (only 48% equity is owned).

    The reason Florida has more millionaires than New York is that New York millionaires retire to Florida because it has no state income tax. This is a no-brainer. As long as you reside in Florida 183 days a year, you can still live in New York too. And I know a lot of people who do that.

  13. madhaus Says:

    I checked SJ Mercury News, and no link to the DataQuick numbers. The DQ site does have numbers through 7/23 on their “Weekly SJ Mercury chart” link.

    Worth noting:
    San Carlos up 7.4%, Millbrae up 6.7%, most other RBA zips flat or down in San Mateo county. Remember the run of 40%+ increases in Millbrae?

    Cupertino finally flattening out (fitting my theory) to 2.8%. A very few zips up, very few: Los Gatos ’30 up 37%! Mountain View ’41 up 27% (the middle zip, ’40 is higher-end one). That one is interesting, a lower $/sf but a higher median than 94040!

    Palo Alto no longer going up. All San Jose down except 95126 and ’33.

    Saratoga up 15%. Sunnyvale 94089 (NOT RBA) is up.

    EVERYTHING ELSE is DOWN (not even flat). That includes Los Altos. That includes Palo Alto. Heck, 94301 is down to $829 a square foot. 94306 is down 24%.

    Face it. The party is over.

  14. DreamT Says:

    madhaus – how about the GBA besides ’89? What doeth ’51 say?

  15. madhaus Says:

    What’s new pussycat? Can’t click the link and check for yourself? Do I have to do **everything** around here? When do I get to play my new Strat?

  16. pussycat Says:

    Ooooohhh! There was a link!
    Today’s not my day. I passed by a student driver on the freeway, with ‘Caution Stick Shift’ painted behind the car. Guess what pussycat said?
    “Why do they even bother writing this? People don’t shift on the freeway!”
    Last night was shorter and rockier than usual, lil’ one kept us awake…

  17. Brian Says:

    Why don’t we do Millionaires/residents? That’s a bit of a more telling statistic.

    Everyone knows California has the largest population and likely the most millionaires by default.

  18. WillowGlenner Says:

    madhaus all that says is that the low end is on fire. I told you that a few mos ago. The reason we had # sales *above*, yes *above* 2005 numbers (this is bay area wide) is due to the low end being priced agressively by banks. It doesn’t mean diddly to other parts of the market.

    On the DQ list 95126 is low end (San Jose somewhere) and its up 6% over last year, true to form. My san jose zip is down 4% from last year, with this being the peak month of last year- no change from a few mos ago even with all these foreclosures, in fact I think 95125 may have been down more earlier in the year. BTW 95117 campbell is up.

    I don’t post this as some kind of RE permabull, its just that I would like to be able to buy a cheap property in a better area than where I usually buy- and I cannot. I look every day. The good houses are getting multiple offers, and they aren’t falling that much. Yes they are falling from the absolute peak and have fallen. But not by that much, and the decline actually happened a few mos ago and now the numbers are flat.

    Also Palo Alto 94306 is not really believeable, must be a bunch of prop 13 transfers or something.

  19. Knicksfan Says:

    HEY where did my comment go?

  20. madhaus Says:

    WG, you know San Jose better than me, but doesn’t 95126 have some really nice parts too, like Shasta-Hanchett or whatever? It definitely is not East Side.

    As to SJ 95117, I don’t consider 1.4% “up.” That’s flat. Any change less than +-4% in either direction is officially flat in madhausia. But there were far more minus signs this time than I’ve seen in a while.

    I will accept bottom-feeding as the reason for the price drops, but that still confirms that the top end isn’t moving because prices are sticky in the RBA. Do you also see bottom feeding in Cupertino, because it’s down too, as are both Los Altos zips. There are cheap parts of Saratoga, but it’s still up a lot.

    Calling out RBA zips:
    Cupertino: +2.8%, that’s FLAT
    Los Altos: ’22 down 13%. ’24 down 4%
    Los Gatos: ’30 up 37%, ’32 down 5%, ’33 down 3%
    Mtn Vu: ’40 down 4%, ’41 up 27%, ’43 down 6%
    wait, if there’s bottom feeding, ’43 should be up, not ’41
    PA: ’01: flat 0%, ’06: -24% (wow)
    shouldn’t 4 weeks of sales smooth out things like prop 13 transfers?
    SJ WG: down 4%
    SJ Westside/CUSD: up 1% (flat!)
    SC ’51: down 4%
    S’toga: up 15%
    SV ’87: down 5%

  21. madhaus Says:

    Re comment #17, thanks a LOT Brian.

    It’s taken me 15 minutes to find the source of the millionaire table. NOW I have to find the census figures for state population in 2004 so I can compute millionaires per capita.

    Okay, that took a little while.

    Average number of millionaires (people with net worth of $1.5m or more) per thousand capita: 7.49 (across all US).

    Top 10 states:

    1. Connecticut: 13.50
    2. Massachusetts: 12.90
    3. District of Columbia: 12.08
    4. California: 11.98
    5. Florida 11.47
    6. Wyoming: 9.94
    7. Delaware: 9.67
    8. New Jersey: 9.14
    9. Maryland: 9.03
    10. New York: 8.72

    Just missed: Washington, Illinois, Virginia.

    And, the bottom 5!

    1. Alaska: 1.51
    2. North Dakota: 1.57
    3. Mississippi: 2.77
    4. Utah: 3.29
    5. South Carolina: 3.33

    Or you can look it up for 2001 yourself, that’s available in a few places.

    I’ll put my excel spreadsheet up on Google Documents if anyone really cares about this stuff.

  22. Anon Says:

    95126 is not low-end. A large portion of that zip code is the Rose Garden area, which IMO, is much nicer than Willow Glen

  23. Brian Says:

    Awesome! Thank you madhaus!

  24. Taxy McTaxandspend Says:

    @madhaus

    “I would love to find some stats on what % of real estate is owned outright (as opposed to owned by the bank) in the RBA zips.”

    I would actually guess it’s either average or higher than average in the RBA. A lot of the housing in the neighborhoods I’ve lived in or looked in are owned by geezers that bought back in the 50′s, 60′s, and 70′s, when the housing was affordable. The only exception, of course would be zips that contain a lot of new construction.

    Unlike other states, there’s no incentive for them to move out of high-value job centers due to Prop 13. This puts much more of a burden on the young, since they need to pay their taxes and commute longer.

  25. nomadic Says:

    Taxy – tell me about it! My next door neighbor has been in the same house for 35+ years. I pay as much property tax in ONE MONTH as he does in a whole year! Neither one of us has kids in the schools and both of us have 2-person households. (That is, same drain on services.) Harumph! :-(

    Lots of geezers in my ‘hood. Maybe half. Keeps things nice & quiet though.

  26. bob Says:

    My neighborhood used to be filled to the brim with old geezers. That was until the latest boom when a lot of them sold out and moved to AZ, OR, or NV. I’d say in my immediate neighborhood, 30-40% of the homes have been sold in the last 5 years, which is the amount of time I’ve been renting the same house. Since then, I’ve noticed the turnover for people staying in a home is short. I swear that I know of at least 5 houses in the immediate 3-4 block radius that are for sale after having been sold just a year or so ago. It really feels like less and less of a real community because every spring and summer, huge chunks of the hood goes up for sale, and for the last 2 years, they stay up for sale for sometimes a year or more. There’s more parking though, which is nice.

    Like I’ve mentioned before, I’m not sure why some people even bother buying these days, especially if they’re simply going to move in a few years anyway. You might be able to paint the walls any color, but you’ll have to paint em’ back to sell it too.

  27. madhaus Says:

    I swear that I know of at least 5 houses in the immediate 3-4 block radius that are for sale after having been sold just a year or so ago. It really feels like less and less of a real community because every spring and summer, huge chunks of the hood goes up for sale, and for the last 2 years, they stay up for sale for sometimes a year or more.

    Oh, oh. I thought Alameda was an undiscovered gem of bucolic living, the Bay Area’s best-kept secret for neighborhood, community, and togetherness. This description makes SW Sunnyvale sound more like Foreverville than My Faire Alameda has turned out. Yeah, we get stuff for sale, but it sells within a couple of weeks unless it’s overpriced, and then the place isn’t resold for many years. In the 15 years I’ve been here I can only remember one house in this area that sold twice, and the second time was due to a divorce.

    You might want to ask the agents at the open houses why the homes are for sale so soon, you get some interesting answers.

  28. sonarrat Says:

    My parents’ block has three houses that are now being resold within 3 years of buying them. Nice, big houses with lake views. Each is asking within spitting distance of the ~$1.3M prices they paid in 2005, but I’m fairly positive none of them are going to get it.

  29. bob Says:

    Yes Madhaus,
    You got me there and I was really fibbing the entire time. Alameda is actually a terrible place to live. Every time I step outside, I swear I have to dodge the bullets from Oakland. That and all the kids here are moderately retarded because their school system is rated 95.53 versus Palo Alto’s 95.52.

    Every single day that I get up I pray to the lord that I will someday be so lucky to be able to live on the Peninsula where it is perfectly safe, and in fact- perfect in every single way possible. I am soooo jealous of you and everyone else that lives on the Peninsula and so sad for myself living out here in Alameda. Sigh… I guess you can’t have everything can you?

    But, the good news is that you and nobody else has to ever come over to Alameda- being the dangerous, crime-ridden place that is it. I mean- it must be a bad place. Why would homes be 30-40% less? That can only mean that its not a good place to raise children or buy and re-sell for big-buxs later, because as we all know, the biggest reason you should buy a house is that its an investment and we could all retire rich by selling it in 5 years.

    Oh- and I forgot to mention- the views of the Bay and SF from Alameda are completely over-rated. When its foggy, you can hardly see SF. Secondly, the city wastes lots of money on bike lanes, parks, and the beaches. What a hoot! They could spend instead on another Bed Bath and beyond.

    One last thing- since there’s no startups here, we don’t have any Google or Facebook employees to enrich our culture here. That and 50% of the island is Korean, so we lack cultural diversity that you get from having Stanford nearby. Gosh Madhaus- you make me realize how lame it is to live here. Thanks for making me see the error of my ways!

  30. madhaus Says:

    bob, how about addressing the instability you’re observing? I know you enjoy ranting, but I would actually enjoy reading a boots on the ground view of where everyone lives and what’s happening now.

    Your post would actually be entertaining if you hadn’t said it 43 times already. At least set it to music or something.

    Speaking of, I got my kultchuh fix last night, went to Kepler’s Books to hear Daniel Levitin, author of This is Your Brain on Music, he’s got a new book out. I can assure you all that Sunnyvale never had and never will have a bookstore like Kepler’s.

  31. Crossroads Says:

    50% is korean? what the heck?

  32. bob Says:

    I kid you not. Almost 50% of Alameda is Korean-American.

  33. madhaus Says:

    Wow, bob lives in an alternate universe, where Alameda is 50% Korean. Here on planet Earth, Alameda is majority White non-Hispanic.

    From City-Data, Races in Alameda:

    * White Non-Hispanic (52.5%)
    * Chinese (11.2%)
    * Hispanic (9.3%)
    * Filipino (7.5%)
    * Black (6.2%)
    * Two or more races (6.1%)
    * Other race (3.3%)
    * Korean (1.9%)
    * Vietnamese (1.9%)
    * American Indian (1.6%)
    * Asian Indian (1.2%)
    * Other Asian (1.2%)
    * Japanese (1.2%)
    * Native Hawaiian and Other Pacific Islander (0.6%)

    I guess math isn’t your strong suit, bob, as the difference between 2% and 50% is somewhat… dramatic. I mean this is a 2500% error. I look forward to future observations from this author:

    * Peninsula has more crime than Detroit
    * Google releases earnings, loses $674 trillion
    * Bay Bridge to be replaced by carbon-fiber tunnel bore
    * All of downtown Palo Alto built on Superfund site
    * Rabid coyotes attacking hundreds of shoppers at Valley Fair
    * Mission San Jose taken over by eminent domain, developer promises “delightful master plan with 4500 sf homes.”
    * San Francisco destroyed by 8.2 earthquake this morning

  34. DreamT Says:

    madhaus – Google decided late last night to move its headquarters to Tennessee, vindicating bob’s claims that the Bay Area is so passé. Now who’s laughing, Sunnyvale snob?

  35. madhaus Says:

    DreamT, I didn’t hear that, I was too busy goggling over the news that the 2012 Olympics have been moved from London to Gilroy. Guess which event Alameda will host? Laser Racing in the estuary!

  36. bob Says:

    Madhaus,
    Don’t you have something better to do than pick apart posts? If you’ve made the choice to be a stay-at-home-mom, then I’d suggest spending more time doing things that are actually beneficial, like hang out with the kids?

    You two are a hoot!

  37. madhaus Says:

    Madhaus,
    Don’t you have something better to do than pick apart posts? If you’ve made the choice to be a stay-at-home-mom, then I’d suggest spending more time doing things that are actually beneficial, like hang out with the kids?

    Said the guy who posts to this site while supposedly being paid to work.

    bob: my kids are at school now. Any more comments on how you’re oh so much more special than everyone else?

    You know, a simple, “Wow, I really thought Alameda was half Korean, guess I was wrong” would do wonders for you.

  38. DreamT Says:

    madhaus – This shows your bias for news that are positive for the bay area! Gilroy is still a long commute away, so I think most of us central silicon valley folks will just pass on that next Olympics and watch it on cable TV.

  39. DreamT Says:

    madhaus – Did you know that Santa Clara boasts TWO Kyo-Po markets? I wonder how many of them in Alameda.

  40. bob Says:

    Madhaus,
    You can carry on this pissing contest for as long as you want to if it makes you feel intelligent. Still doesn’t change my opinions about the Bay Area and the people who blindly and forever ignore the blaring ridiculousness of the cost of living here and its destructive impact on its people and culture.

  41. WillowGlenner Says:

    the people who blindly and forever ignore the blaring ridiculousness of the cost of living here and its destructive impact on its people and culture

    Bob, you’ve really hit a high note with this one, hooray! The use of the words destructive, impact and culture in one bloviating sentence is truly a work of beauty suitable only for premier publications such as National Geographic.

    Shall we create some time capsules for fossilization before life as we know it is literally wiped out from the ridiculousness?

  42. bob Says:

    WG,
    Its because in many ways, its true. I don’t confuse working class suburban homes(the Peninsula) now mistaken for upscale neighborhoods as a defining moment in cultural enrichment. The fact of the matter is that the majority of the world’s successful modern democracies relies heavily on the health and ingenuity of its middle class, which as far as I can see is effectively dead in the Bay Area for none other than the impossibly high cost of living. You cannot buy culture. You cannot invent culture. But you can kill culture, and in my opinion that comes when once class is displaced by another.

    Anyhow, this is pointless arguing with all the happy-dappy “The Bay Area is the best in the world” crowd, so I’m probably just wasting my fingers typing this.

  43. DreamT Says:

    bob – “arguing with all the happy-dappy “The Bay Area is the best in the world” crowd”
    Wait… Your actual purpose posting on burbed is crusading against a crowd of “happy” people, to get them out of their blissful state? This is not only sad, but also mean.

  44. bob Says:

    “Happy” was meant to indicate “delusional”. Sorry. I suppose I should have been more specific.

    Anyhow, I have now realized the errors of my ways. In reality, every million dollar 800 sq foot house posted for sale in the BA is worth every single penny. The Bay Area is truly the most culturally advanced, intellectually superior, most blessed area not only in the US, but perhaps the world. It is so European in its ways, so unlike the rest of the heathens who are too dumb to realize how unfashionable and un-forward-thinking that their respective cities are. Who are people in Seattle kiddin’? Seattle might smell like SF… but it ain’t by any means.

    Yes, the Bay Area… so few understand it, so few see why it truly is worth working 60 hours a week and climbing the career ladder in order to get into a home. That the home is small is only further proof of how environmentally conscious everyone in the Bay Area is. Why buy a medium sized house for 150k in Austin when in Austin, you’d have to cool it with AC and be miserable, with nothing to do? What if you didn’t like music? Austin would SUCK! But not here in the BA, where we have a huge choice of things to do to keep us entertained 24 hours a day.

    Yes… the Bay Area: the epitome of the world. The sacrifices to me made to be one of its proud residents worth every ounce of valiant effort.

  45. madhaus Says:

    um… what on earth does any of this have to do with confusing 2% with 50%? Or are you suggesting that your anti-Bay Area rants are just as accurate as your demographic reporting?

    This just in… Yahoo announces they are abandoning their business model and will henceforth operate a nationwide chain of drive-through liquor stores.

  46. madhaus Says:

    DreamT, I don’t think we in boring, uncultured Sunnyvale have any Kyo-Po markets, but let me check on money-losing ($674 trillion!) Google… nope, the 2 locations are near the Sunnyvale border but are definitely in Santa Clara. However, we have Kabul Afghan restaurant plus 3 other Afghan places, so in your face, Mr. Sorry Wrong Zip Code.

  47. DreamT Says:

    I feel it is my duty to apologize to all. I live in the wrong zip code and I am very sorry about it. I promise I’ll try to do better as soon as my neighborhood’s prices stop defying gravity.
    The lack of Aghani restaurants within two miles is especially hard to bear, as my 10 month-son reminds me daily.
    Fortunately, neighboring Sunnyvale’s prime resident madhaus has the good sense to occasionally put me back in my place. Again, sorry on behalf of the entire (wrong) zip code.

  48. DreamT Says:

    That said, better to drive in a wrong zip code than on San Jose’s 101


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