August 10, 2015

“San Francisco Home Prices Reach All-Time High”

San Francisco Home Prices Reach All-Time High

San Francisco’s residential market not only remained strong in the second quarter of 2015, but hit an all-time high: the median sale price reached $1,185,000, a 20% increase over Q2 2014.

The median price per sq. ft. ($915) — up 10% Q-o-Q and 15% Y-o-Y — mirrors the trend for median sale prices and marks another record for the SF housing market.

San Francisco home prices even exceed Manhattan numbers, where the median sale price for residential properties hasn’t reached $1M yet.


Oh my god. This is so beautiful. Of course, NYC places are a little smaller… so we still have a ways to go.

How can we further accelerate this? How can we pull together to make this happen?

Comments (168) -- Posted by: burbed @ 5:01 am

168 Responses to ““San Francisco Home Prices Reach All-Time High””

  1. michael Says:

    We have already surpassed the values in the first bubble, what could possibly go wrong?

  2. Alex in San jose Says:

    Nothing, absolutely nothing! NYC doesn’t have bread bowl clam chowder, shit on the side walk, The Bushman, street light poles destroyed by piss, or the 7 Galaxies guy. Fuck NYC, its their prices that are overinflated not ours!

  3. nomadic Says:

    LA is reminding us they’re less affordable. Only by virtue of having lower paying non-tech jobs…

    http://la.curbed.com/archives/2015/08/la_county_is_the_nations_most_unaffordable_place_to_buy_a_house_says_study.php

    They concede it’s more expensive up here.

  4. Alex in San jose Says:

    Speaking as a techie, almost tech jobs pay shit.

    Yes, there’s a tiny minority of techies making the big bucks, from their mid 20s to their mid 40s, then if they’re very lucky they can drive a VTA bus.

    Going into tech thinking you’re going to make even decent money is a pipe dream, somewhat akin to assuming that because you’re tall, you can learn to play basketball and make Earvin Johnson money. Much more likely, you’ll become an underpaid highschool basketball coach.

    Do what you love! Because even if its basketweaving, if you love it you’ll be happier and better paid than you’d be in tech.

  5. Alex in San jose Says:

    I meant to say almost all tech jobs pay shit…

    Los Angeles has a large port, all kinds of neat Unionized jobs… Plus there’s all kinds of neat TV and movie shit there.

  6. nomadic Says:

    Mathematically, your argument is invalid. Median household income in SF is 50% higher than LA. The difference isn’t due to the service jobs, and I don’t think there are significantly more single income households down there.

  7. Alex in San jose Says:

    Where are all these high paid techies keeping themselves? Biodomes? I live in supposedly tech central and everyone I know other than my employer is making about ten grand a year like I am.

    The average between my income and bill gates income looks pretty good but it doesn’t change the fact that my own income is shit and that for the vast, non connected majority, tech is a very bad life decision.

  8. nomadic Says:

    They’re living in million dollar shacks or paying $4k/mo to rent a 1BR in SF. Takes more than a fortunate few to drive up prices so much.

  9. Alex in San jose Says:

    I guess what I’m seeing is the kind of class stratification I saw in 1980s southern California, where no one you knew made a few thousand more or less than you did.

  10. Alex in San jose Says:

    So what we do is find the tecbiodomes and instill a great quantity of pure nitrigen, techies go to sleep, and its several less.

    In old time eastern Europe, if a kid showed signs of genius, he was killed by the townsfolk. It appalled me when I learned of this, but now I appreciate the great wisdom of this.

    So don’t brake for techies!

  11. zzy Says:

    This RE bubble has long since passed the ridiculous stage–when things go “POP!” there’s going to be a history making disaster. People are very predictable–they make the same mistakes, over and over and over again….

  12. mtv-renter Says:

    It doesn’t take a lot of people who make more than the median to drive up prices, because the change happens at the margin. How many houses are for sale at any given time, and how many people compete for those? Among those competing, how many wealthy folks per house does it take to overbid (just 1).

  13. Alex in San jose Says:

    And chances are almost all of those over median earners are doing so by cheating widows out of their pensions or selling used cars or loansharking or something, not in tech.

    I swear this town is like Nashville or something, tons of people thinking if they pick up a guitar they’ll become rich, and the vast majority certainly not doing so.

  14. Real Estater Says:

    Alex, stop whining. With your income I don’t think you can cut it in Idaho. Every house is owned by somebody, and they all made it happen. Some of us own multiple properties and still manage to support a family in a good school district. It just takes some financial sense and good planning.

  15. Real Estater Says:

    Let me say it once more. There is not a cloud in the sky to support a bubble theory. These prices are here to stay and home owners can continue to expect a stable and healthy market.

  16. maryjane Says:

    Every house isn’t owned by somebody. Most are owned by the bank that holds the mortgage. The ‘owner’ is paying the bank for the opportunity to live there. People make all sorts of decisions about how and where they want to live. For some, having minimal equity in a house they hope they can continue to afford doesn’t seem worth the trouble. Being one paycheck away from a missed mortgage payment can keep some people up at night. Others can sleep soundly. I think Alex is fine with his decisions and lifestyle.

  17. nomadic Says:

    Can 4.5 acres in PA actually be worth up to $39M? ($29M set aside plus another potential $10M in bonds.)

    http://www.contracostatimes.com/business/ci_28646610/palo-alto-nonprofit-organization-makes-offer-buy-buena

  18. Alex in San jose Says:

    Excretor’s, I was wondering where you’d gotten to, did your mom send you to your room for a while?

  19. deertick Says:

    “Let me say it once more. There is not a cloud in the sky to support a bubble theory. These prices are here to stay and home owners can continue to expect a stable and healthy market.”

    Its a pity that it was pretty un-original to say that very same thing in 2005. We all saw how that turned out. It’ll crash… just like it always does and you can count on it.

  20. Alex in San jose Says:

    SHHH! He just got a hot stock tip from his shoeshine boy and is off to act on it.

    I work for a guy who is a legitimate rocket scientist, makes a bit over $150k a year, and has assets over a million. He also has the financial acumen of a 13 year old, and as I like to put it, he has no off switch. His life is a treadmill, one that seems enjoyable enough to him because he’s known nothing else, being a little professor from very young age. He’s kind of fun to be around, if you don’t mind the cyclotron parts everywhere, and discussing atomic interactions at 4am.

    I do not envy his life in the least. I got onto the lower level of the American treadmill before the crash saved me and it was Not Fun. I’d much rather be a bum and sleep on sunny hillsides and have little to no worries.

  21. 2million$shack Says:

    Here we go: http://www.marketwatch.com/story/us-stock-futures-point-to-third-day-in-the-red-2015-08-20?dist=afterbell

  22. maryjane Says:

    Sell your stocks and buy real estate in Palo Alto. Bad things never happen in Palo Alto.

  23. nomadic Says:

    Great news – stocks cratered, so now the Fed might not raise interest rates next month. The real estate party won’t take a breather. Borrow now before you’re priced out forever.

  24. Alex in SJ Says:

    I feel like we’re in 2006 …. RE’s starting to level off … if I were still selling at the swap meet I’d be hearing old guys tell me all about how they waited 6 months to sell their house and lost $50k….

  25. 2million$shack Says:

    Maybe nomadic. Could be the Fed calls off the rate hike…maybe even QE4? Then a $2m tear down in Palo Alto will be a bargain.

  26. nomadic Says:

    Oh, haven’t you heard? Palo Alto is always a bargain because prices always go up… faster than anywhere else and faster than wage growth… forever.

    If the markets have you feeling down, here’s a feel good story:
    http://www.buzzfeed.com/williamalden/sf-home-for-the-elderly-opens-its-doors-to-techies#.vlbkXj2Ym

    “Anyone who walks in that building will see a critical mass of old people, rolling around the building, hanging out in the common areas,” Wavro said.

    Actually, it is nice to hear that some RE investors are trying to help people out.

  27. Real Estater Says:

    What an exciting sell-off. I have minimal exposure to stocks since I don’t believe in it. I’ve got cash waiting on the sidelines ready to take over Deertick’s 401k.

  28. maryjane Says:

    Why does Real Estater remind me so much of Donald Trump?

  29. Petsmart groomer Says:

    > Why does Real Estater remind me so much of Donald Trump?

    Both Real Estater and Alex in San Jose are caricatures. Let’s enjoy them for what they are.

  30. Alex in San jose Says:

    Techies are paying two grand a month to live in a micro studio in and oldmfolks home??

    No hot bunking yet but when you see places being rented out in shifts, the next crash is nigh.

  31. 2million$shack Says:

    No hot bunking required. The next crash is already underway. Dow, NASDAQ, S&P 500 are all in the red for the year. The Shanghai Composite is trending down in spite of major efforts to reverse the crash.

    A year from now there won’t be crazy amounts of money from China, Silicon Valley IPOs and acquisitions driving prices higher. Prices will be flat to down.

  32. Alex in San jose Says:

    That’s interesting because in San Jose there are new condos or apartments being constructed all over the place. A ton of new housing stock sure won’t help in keeping prices at their present outrageous levels.

    Oh well, RE never goes down!

  33. Real Estater Says:

    We’ve seen this before. When stock market becomes unstable, money gets routed into real estate. It’s already happening in China. Be prepared to see more upside in RE.

  34. Real Estater Says:

    Notice how guys like Deertick are all of a sudden staying low? History has proven over and over again that saver tactics don’t work. All the hard earned money he diligently put into “the system” can evaporate overnight.

  35. Alex in San jose Says:

    The problem is, Chinese and Indians have already pumped up this bubble by parking their ill-gotten suitcases of cash into US real estate. If the Indian and Chinese economies are drying up the fountains of cash, there will be a hell of a lot less of it coming over here. That’s how you get the present leveling off, and then a slump.

  36. BayFan Says:

    I wonder if the next door home sold went to a SPY, exciting times…http://www.cnn.com/2015/08/19/politics/chinese-spies-double-digits/
    US consider sanctions on China for stealing IP, trade secrets etc… while making it super easy to launder money! haha – well good luck with that Mr. President – http://www.infoworld.com/article/2978111/security/us-readies-sanctions-against-china-for-cyber-spying.html

  37. Alex in San jose Says:

    Bayfan that’s why a lot of us companies are moving manufacturing back to the USA, IP theft and knockoff copies of microchips being run off.

    Plus its often cheaper to make stuff in the USA anyway.

  38. Bill Lumberg Says:

    Maybe deertick had his downpayment money in the stock market.

    As for China it’s laughable that you think they are putting money into real estate. The Chinese real estate bubble has long since burst. There are over 300,000,000 empty apartments in China. Hardly a good investment. However, I’ll buy the idea that the crashing market (both ours and theirs) only pushes them more into US, Canadian, Australian (though they are rightfully limiting Chinese/foreign investment), and New Zealand real estate. This will be the last bit of air into the balloon before the whole thing blows.

    I’m actually a little bit nervous for the Bay Area with all of these unprofitable tech startups that burn cash like crazy. When stock markets crash VC money becomes tight. A large number of these unprofitable companies aren’t going to get their next tranche of money and are going to go belly up. Unemployment will rise, housing demand will plummet, and the housing market, already a bubble, will burst and it’s 2000/2008 all over again.

  39. deertick Says:

    “Notice how guys like Deertick are all of a sudden staying low? History has proven over and over again that saver tactics don’t work. All the hard earned money he diligently put into “the system” can evaporate overnight.”

    Let me help re-inform you since you seem to be suggesting something about me. First of all- my stocks are fine. Sure- they’re down a bit but that’s mainly because I have a highly diversified set of investments. Anyone who bet it all on China would have made a poor decision. That’s shows a lack of diversity and no one-sided investment can hope to perform well.

    So to help put your mind and ease: I’m doing jusssst fine and dandy….

  40. Bill Lumberg Says:

    My comments were to Real Estater, if that wasn’t clear.

  41. deertick Says:

    I was responding to RE’s comment about me supposedly “laying low” or whatever. More that a post only shows up about once every 3 months. But regardless, poo-poo on me for feeding the troll. I should’ve known better.

  42. Alex in San jose Says:

    Let’s not pick on deertick, maybe he’s got a life.

    I agree, lumberg, even the last bit of air out of the collapsing Chinese balloon could buy some houses. And I agree I think we may be heading for dot com crash part deaux, because there are the most idiotic ideas being pushed as the next big thing and startups are burning upncash like crazy.

    I’ll continue with my belief that tech is effectively going backwards, and when it gets awful enough, we’ll collectively wake up and go back to our bakelite phones.

  43. Real Estater Says:

    Deertick says,
    “First of all- my stocks are fine. Sure- they’re down a bit but that’s mainly because I have a highly diversified set of investments.”

    I’m looking at the Stocks app on my phone, and I just don’t see how diversification can help you.

  44. Bill Lumberg Says:

    I added my last comment after realizing that I didn’t mention the target. Had nothing to do with your comment Mr. Tick. Sorry for the confusion. Cheers.

  45. Real Estater Says:

    Bill Lumberg says,
    >>There are over 300,000,000 empty apartments in China. Hardly a good investment.

    I know someone who just sold his apartment last week. It was on the market for less than a week, and the buyer paid 80% down. Net profit on the apartment, purchased 5 years ago, is just over a million USD. The seller is going to use the proceeds to buy real estate here. The seller has another apartment in China that he’s keeping empty, because the profit from the apartment he sold covers the investment he made in both apartments. There is absolutely no risk.

    This is a very typical example by a small time investor. I know several people with 10 or more apartments.

  46. Bill Lumberg Says:

    Cool anecdote, bro.

  47. Alex in San jose Says:

    Excretor, we don’t care what your parents have, as soon as they kick off, you’ll be pissing it all away at Alex’s 49er.

  48. 2million$shack Says:

    I thought this article was spot on given my recent experience at a start-up that blew through over a million a month of VC money with zero revenue and a 20-something CEO who only cared about increasing the number of non-revenue generating users.

    ‘Arguing there’s no tech bubble because it’s not 1999 is like saying Kim Jong-un is fine because he’s not Hitler,’ says top tech investor
    Read more: http://www.businessinsider.com/bill-gurley-likens-the-tech-bubble-to-kim-jong-un-2015-9#ixzz3kYRazGLM

  49. maryjane Says:

    RE: Real Estater

    “The seller is going to use the proceeds to buy real estate here. The seller has another apartment in China that he’s keeping empty, because the profit from the apartment he sold covers the investment he made in both apartments. There is absolutely no risk.”

    The only other deals I hear about that have “absolutely no risk” originate in Nigeria.

  50. deertick Says:

    Look up “ghost cities” in China. There are literally HUGE full-size, completely new and uninhabited cities that have been built in China and more being built all the time.

  51. Bill Lumberg Says:

    That Flintstone shitshack visible from 280 is going on the market for a rumored $4.2 million.

    http://blog.sfgate.com/ontheblock/2015/09/02/flinstone-house-on-the-market-for-rumored-4-2-million/#photo-681592

  52. Real Estater Says:

    >>Look up “ghost cities” in China. There are literally HUGE full-size, completely new and uninhabited cities that have been built in China and more being built all the time.

    If you do an apples to apples comparison of cities in China to those in the United States, you’ll find that America has mostly “dead cities”, or what I call “sky-cam” cities with no life. China, in contrast, has far more vibrant cities with retail, commerce, walkability, modern infrastructure, and night life. If you want to diss China, really, pick something else. Better yet, pay a visit and see for yourself.

  53. Alex in San jose Says:

    Look, Excretor, just because your parents were high ranking Party apparatchiks who smuggled a lot of peasants’ money out of China to buy the house you live in the basement of, doesn’t mean China is heaven.

  54. BayFan Says:

    http://sanfrancisco.cbslocal.com/2015/09/07/racist-anti-chinese-messages-popping-up-on-san-francisco-buildings/
    Well what I really want to know is if the person/people who did this used “made in china paints” – with the look of it that seems to be the case – severe lack of vibrancy and not holding up!

  55. nomadic Says:

    Sore losers.

  56. Alex in San jose Says:

    Like this Californian would move to a shithole like Portland!

  57. Real Estater Says:

    >>Like this Californian would move to a shithole like Portland!

    Of course not. Kalifornians only invest there. Given their houses are cheaper than our overbids, we are the Chinese in Portland.

  58. Alex in San jose Says:

    Personally, I’m all for a revival of the meme of The Yellow Peril, so what if a bunch of Chinese crooks buy up some houses, we simply nationalize those houses, imprison the chinese crooks, and hand them over to the Peoples Liberation Army, ship em over by slow boat, its all win.

  59. Real Estater Says:

    It’s hard to imagine, there are countries in Europe that welcome penniless refugees to migrate to their land, yet in this country, we are even hateful toward foreigners who bring suit cases of cash!

  60. Bill Lumberg Says:

    RE, I think it’s that we’ve just had our fill. We’ll see how it works out for those taking in these refugees.

  61. Real Estater Says:

    I think we, of all countries, should be taking in refugees. After all, we created this problem in the first place by going into Iraq. The amount of evil that’s been unleashed is far worst than any chemical weapons that was never found.

    Back to real estate. This country has a vast fly-over land in the middle that is under-utilized. We can accommodate at least twice the number of people that are currently here.

  62. Real Estater Says:

    Recent events have given me great respect for Germany. I will be buying more Germany cars from here on.

  63. Alex in San jose Says:

    German Hot Wheels cars?

  64. maryjane Says:

    Teslas are too expensive?

  65. Real Estater Says:

    Tesla has one annoying flaw people don’t talk about. That is, you can only charge it from the rear part of the car. In most garages the electrical outlet is by the front.

  66. nomadic Says:

    RE, even you should be able to back into a parking space with a Tesla. They have a giant screen so you can see behind you easily.

  67. Real Estater Says:

    I said annoying. I didn’t say impossible. Just don’t need an everyday inconvenience.

  68. Bill Lumberg Says:

    Or you could charge your tesla daily on the taxpayers dime at the local library while your force your child to study like so many in my town.

  69. Alex in San jose Says:

    Hahaha force them to study useless shit like programming!

  70. Alex in San jose Says:

    Man is this site dead… Is everyone off studying those mail order shoemaking courses like they should?

  71. nomadic Says:

    No, we’re all busy plotting which open houses to attend on the weekend and how much to overbid.

  72. Alex in San jose Says:

    Don’t forget to wear a jacket with pockets to stash away lots of stale sandwiches!

  73. nomadic Says:

    Heh, in this market, you have to leave food for the sellers.

  74. BayFan Says:

    Price reductions and few back on market observed in south bay – i am guessing market is taking a turn…

  75. Alex in San jose Says:

    Nomadic remember all the jokes about the stale sandwiches at open houses in 2007?

    Now’s the time to recycle them!

  76. Fun Sucker Says:

    What’s the story with 390 Margarita Avenue in Palo Alto? It looks like it sold for 1.3 mil in October AND November of last year, was listed at 2.9 in July, and is now suddenly on the market for <1 mil. The listing says there's a FAQ available on request. Meth house? Super Fun house?

  77. BayFan Says:

    Stale sandwiches jokes sound fun… too bad I missed them as I was not here in 2007. However being a team player … I am throwing in the stale soup to go with the stale sandwiches – first come first serve !

  78. BayFan Says:

    Just heard from a colleague (whose wife is a Realtor) inventory is 3* today vs. start of year and houses are staying longer on market… he particularly mentioned Fremont and Cupertino and other areas may be worse… boy things are moving faster than I thought…

  79. Petsmart groomer Says:

    BayFan, it was the same last year. September/October have highest inventory when December/January have lowest. You will see some price reductions now. Seasonality is a b*tch.

  80. Alex in San jose Says:

    I was in downtown campbell yesterday and saw an ad in a realtors window for a house in Morgan hill, price lowered. It did not indicate how much it was lowered, however.

  81. Real Estater Says:

    >>Just heard from a colleague (whose wife is a Realtor) inventory is 3* today vs. start of year and houses are staying longer on market… he particularly mentioned Fremont and Cupertino and other areas may be worse… boy things are moving faster than I thought…

    Early panic by a newbi. We’ve seen that before.

    Here is the latest neighborhood sales data I just got for Palo Alto:

    849 Wintergreen Way. List: $2.095M. Sold: $2.458M
    877 Thornwood Dr. List: $2.08M. Sold: $2.6M
    744 Holly Oak Dr. List: $2.195M. Sold: $2.5M
    909 Sycamore Dr. List: $2.998M. Sold: $3.7M
    888 Colorado Ave. List: $1.988M. Sold: $$2.665M
    990 Amarillo Ave. List: $1.895M. Sold: $2.6M
    815 Rorke Way. List: $1.995M. Sold: $2.665M
    3229 Morris Ave. List: $1.898M. Sold: $2.52M

    The market is solid. There are tons of other examples, but I’m tired of typing. It’s only money guys!

  82. Alex in San jose Says:

    Those are Chinese ghost houses.

  83. Real Estater Says:

    I’m giving you data as opposed to hearsay: “My friend’s grand mother’s daughter used to be a realtor before she became a chef…”

  84. Alex in San jose Says:

    Yes but those are all in Palo alto, about the best bet in real estate. High chance of going up, if they go down they won’t much because of Stanford.

    If you’re some mid level Party official looking for a place to park your ill gotten peasants gold, PA is a good place and you have a place to go as long as you don’t miss the last airlift out.

  85. Bill Lumberg Says:

    Those will all be back on the market in 16 years when their two year olds don’t get into Stanford.

  86. Joe Says:

    Wait, 16 years? I thought they’d be back on the market in 5 years when the fertility treatments don’t work…

    When should I start buying houses for my grandchildren to go to Stanford? Is after my own kids enter elementary school too late?

  87. Alex in San jose Says:

    Good one lumberg!

    It all depends on getting into the right preschool, getting high grades there, I know, ?????, then the right kindergarten… To give an idea, I used to hang out with a lot of Olympic athletes…. They were essentially predestined by their parents to do whatever sport their parents had chosen for them, and had no concept of being their own person. Great, I guess, if you do well, if you are a few percentage points below world class, you end up working at a gas station, I’ve seen it.

  88. 2million$shack Says:

    Look at the steal these buyers got: https://www.redfin.com/CA/Palo-Alto/221-Santa-Rita-Ave-94301/home/767677 . $4.15m for a teardown w/ some train noise thrown in at no extra charge.

  89. Alex in San jose Says:

    They’ll find out the midnight special s a real thing…. There’s a freight train that rolls through at about that time.

  90. Real Estater Says:

    You know it’s within 2 blocks of the Jobs, right?

  91. Real Estater Says:

    >>Yes but those are all in Palo alto, about the best bet in real estate.

    You got it wrong. Deertick wouldn’t want to live there due to traffic.

  92. Alex in San jose Says:

    The Jobs? Is that like the Donald?

  93. 2million$shack Says:

    I guess some people are willing to pay a serious premium to live 2 blocks from Job’s family. Personally, I’d rather buy a tear down in central Menlo on a larger lot and save a million and change.

  94. Bill Lumberg Says:

    It’s all about name-dropping Jobs back home in the mainland.

  95. nomadic Says:

    It’s official: I’ve been here too long. This doesn’t look like such a bad deal.

    http://www.vice.com/read/the-cheapest-house-in-san-francisco-is-a-dilapidated-shack-selling-for-350k-511?utm_source=burbed

  96. Alex in San jose Says:

    I’d say it’s a teardown, but due to zoning, you may not be able to build something new. So you’d have to keep doing home improvements until you’ve replaced every board.

  97. Alex in San jose Says:

    This just in, friend with a big place in Sunnyvale told me his house valuation just went down from 1.7 to 1.6, million, of course. And the place he walks his dog by is for rent for 5k a month but has been just sitting, no takers.

  98. Bill Lumberg Says:

    Nothing is really going to change until a few unicorns die and the layoffs start.

  99. nomadic Says:

    The teardown in my post (94) is looking great just about now.

    http://www.citylab.com/housing/2015/09/im-obsessed-with-san-franciscos-bunk-bed-craigslist-ads/407281/

  100. Alex in San jose Says:

    Lumberg, that may start soon considering how many unicorns are based on doing things young people’s moms used to do for them before they moved out, or to help them pass notes in class. Or crap like Candy Crush.

  101. Bill Lumberg Says:

    That’s an interesting point. As rents keep increasing it’ll be harder and harder to justify paying someone to walk your dog, deliver your groceries, deliver your local takeout, do your laundry, etc. etc. when one can do all of these things for oneself (virtually) for free.

  102. Alex in San jose Says:

    Lumberg… Bingo bongo winner winner chicken dinner. Right now I’m lucky to not be in a homeless camp, I take photos of electronic surplus items and put them on eBay, when I have real internet once a
    Week from the guys house, and our sales are going from a reliable hundred bucks a 24 hour period to 20 or 30 bucks. I’m not too worried, since I’m a reliable watchdog living in the building the stuff is stored in and my pal will not abandon the stuff, but the fat 250 a week I make a week may taper down and I’ll just do some other stuff to fill in. I saw this in 2007 and 2008. Sales down to a quarter or less of what they were. EBay sales may be a good way to track the next collapse, which may be starting last week.

  103. Alex in San jose Says:

    Lumberg, waitll the millennials discover the cheapness of cookies whole foods from the farmers market at home!

    I was sent to Korea with no pay for some reason and managed to get through the deployment on something like 24 bucks, I polished my own damn boots.

  104. Alex in San jose Says:

    COOKING GODAMNIT.

  105. PatinDC Says:

    Game on.
    http://www.nytimes.com/2015/10/01/realestate/manhattan-apartment-prices-near-million-dollar-mark-reports-say.html?smid=fb-nytimes&smtyp=cur

  106. BayFan Says:

    What no Palo Alto???
    http://abc7news.com/realestate/new-list-shows-hottest-zip-codes-for-home-sales-in-bay-area-/1010385/

  107. Bill Lumberg Says:

    It also makes for rapid-fire sales. The amount of time that listings spent on the market fell 20 percent to a record low of 73 days in the third quarter, according to the Douglas Elliman report.

    That’s called languishing on the market in the RBA.

  108. 2million$shack Says:

    Campbell? Really? It has some cute areas but the commute (to the RBA) is killer and the schools suck. I went to high school there and wouldn’t send my kids to Campbell schools. I find it shocking how many sh**y schools are in the bay area given the insane rents/ mortgages.

  109. Alex in San jose Says:

    Insane rents and mortgages are OK because prices can only go up, Up, UP!

  110. Bill Lumberg Says:

    “I find it shocking how many sh**y schools are in the bay area given the insane rents/ mortgages.”

    With all the anti-gentrification sentiment and push for affordable housing and requiring builders to include BMR housing in their buildings, are you really surprised that the schools still suck?

  111. Bill Lumberg Says:

    Twitter bailed on expanded SF office space and will announce layoffs.

    http://recode.net/2015/10/09/twitter-is-planning-company-wide-layoffs-for-next-week/

  112. Alex in San jose Says:

    You realize if kids start making their own Mac and cheese and doing their own laundry, the app and sharing economy is doomed.

    Yeah at age 53 I’m gonna call 20-somethings kids.

  113. Real Estater Says:

    Discussion: How do people afford Palo Alto

  114. BayFan Says:

    Million Dollar Shack: Trapped Inside Silicon Valley’s Housing Bubble
    https://www.youtube.com/watch?v=mNGKx2nq4UI

  115. Alex in San jose Says:

    Excretor, there’s always east Palo alto. A nice bike ride to stanford.

    I have to admit, old Snodfart is a pretty nice place to kick around.

  116. BayFan Says:

    and more … http://venturebeat.com/2015/10/12/snapchat-is-reportedly-shuttering-snap-channel-for-good-will-lay-off-some-employees/

  117. 2million$shack Says:

    Re: Million Dollar Shack: Trapped Inside Silicon Valley’s Housing Bubble
    https://www.youtube.com/watch?v=mNGKx2nq4UI

    Anyone else think Ken DeLeon is full of crap (to put it kindly)? My family happens to be in the MBA/ JD / PhD demographic that he points out are the new owners in Palo Alto (along with Chinese investors) and by no means are we more intelligent than previous generations. We picked degrees/careers that are highly valued by the tech economy. Perhaps, there is some intelligence in that decision but imo it was mostly luck with some excellent guidance from the previous “lower-IQ” generation.

    I guess that kind of BS impresses his target market of foreign investors — be surrounded by geniuses. You can be highly intelligent, have a PhD and work your butt off but if your area of expertise isn’t in something the market values, you’ll still be commuting from Stockton.

  118. BayFan Says:

    Looks like others agree with you…
    https://www.facebook.com/BayAreaHousingMadness

  119. maryjane Says:

    I watched the video and, although I knew things were bad, I had no idea they were THAT bad. This may seem like a stupid question but can anyone from another country buy a house and move here? I’m not familiar with the Chinese real estate tours so I’m baffled that there doesn’t seem to be any regulation. Surely it must take more than just buying a house to to be able to move to the US?

  120. 2million$shack Says:

    Maryjane, I’m not an expert in this area but I believe anyone with the cash to buy a home here can do so. Moving here and becoming a citizen is not as easy. Some of the homes maybe purchased with citizenship in mind. Others are purely investments. They sit empty (ghost homes) or are rented out.

  121. Bill Lumberg Says:

    EB-5 program
    http://www.uscis.gov/green-card/green-card-through-job/green-card-through-investment

    $1,000,000 investment for urban areas, $500,000 for rural areas. Our government is selling us out for a few yuan.

    It’s amazing that, aside from a few “No More Chinese” graffiti, that there isn’t more anti-Chinese sentiment in the Bay Area. To be clear, I’m not advocating for it in any way, shape, or form, only expressing my surprise that there isn’t more of it.

  122. Alex in San jose Says:

    I’m pretty sure I’d need a million on tap to escape to france or Switzerland.

    But id be moving to one of those places to be around people who look like me, share a common culture, and by God I’d learn the local language and speak it.

  123. Real Estater Says:

    Bill,

    It’s easily explained. Chinese are not really coming here. They are just buying here. Why would they come here when their country is way more happening?

    Check out this British propaganda video against China:
    https://www.youtube.com/watch?v=P9Z9Kblvq1M

    Watch it with your own eyes and you will see the incredible country that is China. Use your own brain to think instead of being lead by the hidden agenda of the video producer. What is not possible in the West is possible in China. These people keep hoping the Chinese Communist Party will go down but it is going as strong as ever. The video keeps talking about debt, but they ignore the fact that America has far more debt, and most of it owed to China. China cannot possibly go down because it is too big to fail. If it ever happens we will all be out on the streets.

  124. Bill Lumberg Says:

    “Chinese are not really coming here.”

    I have a hard time believing you typed that with a straight face.

    http://www.npr.org/sections/thetwo-way/2012/03/23/149244806/u-s-census-show-asians-are-fastest-growing-racial-group

  125. Bill Lumberg Says:

    “America has far more debt, and most of it owed to China.”

    First, Japan has become the largest FOREIGN holder of US debt over China. The biggest holder of US debt is the US government. RE, what happened? You used to be smarter than this. That’s a very sophomoric post.

    http://www.forbes.com/sites/mikepatton/2014/10/28/who-owns-the-most-u-s-debt/
    http://money.cnn.com/2015/04/15/news/economy/japan-china-us-debt-treasury/

  126. maryjane Says:

    If Asians are the fasted growing group in the US what are the stats for CA? I was in the Costco in SF the other day and I don’t ever remember hearing so many people speaking Chinese. I’m used to seeing a lot of Chinese faces but a huge number of people seemed to be recent arrivals.

  127. BayFan Says:

    For SFO check here: https://en.wikipedia.org/wiki/San_Francisco#Race_and_ethnicity

    http://www.pewsocialtrends.org/asianamericans-graphics/

  128. Bill Lumberg Says:

    And BayFan’s numbers (US Census) are from 2010. Think about how much has changed over the last 5 years. They are also having children at a higher rate than white Americans (2.26 children vs. 1.8 children). For evidence of this just look at the local elementary schools.

    http://cis.org/ImmigrantBirthRates-FertilityUS see table 1.

  129. Real Estater Says:

    For all the real estate Chinese supposedly bought, I see mostly white kids in the local schools. How do you explain that?

  130. BayFan Says:

    It all might add up after trying these delicacies…

    http://listverse.com/2015/03/15/10-bizarre-food-scams-that-could-only-happen-in-china/

  131. Bill Lumberg Says:

    Here’s your housing bubble.

    Lin-Lin Tsou-Otani is a real estate agent with DeLeon Realty. It’s Saturday morning, and our housing search starts in Cupertino, in a van filled with about 10 other people. The van seats are full – so Tsou-Otani stands in front, guiding buyers on a tour conducted half in Chinese, and half in English. ‘Raise your hand if you think the housing market is going crazy,’ she says. The crowd chuckles.”

    “And these investments are paying off. Three years ago, the average home price in Palo Alto was $1.2 million. Now it’s around $2.5 million. ‘If you bought three years ago,’ says DeLeon International Outreach Director Kim Heng, ‘you’d be a millionaire now.’”

    http://kalw.org/post/competitive-south-bay-real-estate-market-pits-international-chinese-buyers-against-locals#stream/0

    Buy now! Be a millionaire in 3 years! Don’t miss out!

  132. Smith Says:

    Real Estater, which schools? As forward thinking and diverse as the Bay Area is, it somehow remains quite self-segregated by neighborhood. South Palo Alto, North Palo Alto, East Palo Alto, Menlo Park are only miles apart from each other but have very different demographics.

  133. Bill Lumberg Says:

    Palo Alto
    Hoover Elementary – 72% Asian
    El Carmelo – 33% Asian
    Palo Verde – 44% Asian
    Ohlone – 31% Asian

    I don’t have time to go through every elementary school in the Bay Area so I’ve chosen a few where I believe you said you live. For more see Foster City, Cupertino, San Ramon, etc.

  134. 2million$shack Says:

    Real Estater,

    Really? A Palo Alto school mostly white kids? I’d say PA schools range from a nice diverse mix to predominately Chinese.

    Now if it was Menlo Park, Portola Valley, or San Carlos, I’d believe the mostly white kids talk…

  135. 2million$shack Says:

    Here, you can “live like royalty” in PA: https://www.redfin.com/CA/Palo-Alto/3719-Starr-King-Cir-94306/home/763167 . What a joke.

  136. Real Estater Says:

    The joke is seeing amateurs who don’t live in Palo Alto commenting on the schools.

    Hoover is not even a neighborhood school. It is a special school focused on academics; of course Asians will predominate there because only the best and brightest academic kids will be drawn to it.

    Examples given are all South Palo Alto schools. Sorry that’s not where I am.

  137. Real Estater Says:

    >>“And these investments are paying off. Three years ago, the average home price in Palo Alto was $1.2 million. Now it’s around $2.5 million. ‘If you bought three years ago,’ says DeLeon International Outreach Director Kim Heng, ‘you’d be a millionaire now.’”

    She’s wrong. Palo Alto median average home price is over $3M now.

    Life is short. You just lost $100K today Bill.

  138. 2million$shack Says:

    Amateur perhaps, but school demographics are publicly available. Also as a parent of 2 small children who currently lives in Menlo Park, I have made a point of driving past the schools at the end of the day to get a feel for the different neighborhoods. There is quite a difference. South PA compared to North PA. PA compared to MP. Depends on what you are looking for but the demographics differ substantially by neighborhood.

  139. Real Estater Says:

    That’s right. I was merely making a comment about my own neighborhood. These people are dishing out publicly available stats without knowledge of where I live. That’s why they are amateurs.

  140. Real Estater Says:

    One of the things you get from the KALW article is that real money can’t be made here. “Paying your dues” is worth nothing. No one cares if you grew up here, know the culture, or speak English without an accent. Sellers want you to show them the money. If you want to make money you need to be in China. That’s the real land of opportunity where you dreams can come true. After you make your money, come here and buy a house.

  141. Alex in San jose Says:

    Excretor, I agree.

    The USA is too expensive, and frankly the real talent and manufacturing are in places like China and India, Korea, viet nam etc.

    We are heading into another tech downswing as I type. It looks like the tiny tech company I work for is probably going to crash and burn, mainly because the guy running it can’t do math.

    I’m not in immediate danger but I need to get something else going. Very strong art background plus ivy educated dad mean I might end up helping many Indians and Chinese understand the disaster that is English.

  142. Alex in San jose Says:

    Bayfan, that article is utterly disgusting and refreshingly nonclickbaity.

    Basically, China is like the USA before Upton Sinclair published The Jungle. The book was supposed to show the cruelties of unfettered capitalism, but what it actually accomplished was to bring some regulation into the US food industry.

    Swift’s Pure Leaf Lard! Now with less boiled in Lithuanian immigrants!

  143. BayFan Says:

    The new norm: while you will have ghost houses empty next door, your colleagues will be from Vegas… http://www.realtor.com/news/trends/rent-in-vegas-commute-to-san-fran-save-money

  144. 2million$shack Says:

    Any landlords on here? Has anyone else seen rents starting to drop? The home next to ours rented for $7k/month last year. The tenants moved in July and the landlord has dropped the rent to $6k/month with no takers.

  145. Alex in San jose Says:

    The old renters found out they could live under a $4 million dollar bridge for free.

  146. Alex in San jose Says:

    Bayfan that surf air deal actually sounds pretty good, I guess if I were at the $150k level or so, which seems to be the amount what’s considered decent tech pay.

  147. Real Estater Says:

    I just increased my tenant’s rent by 10%. I’m pretty sure the market will bear another 10% hike, but I’m nice to my tenants.

  148. Alex in San jose Says:

    Excretor – do you rent to barbie or Ken?

    Do they pay you in legos or monopoly money?

  149. DreamT Says:

    RE the ones in Tracy? Seems overly nice considering I’ve heard about 300% increases. Or do you increase by 10% on a monthly basis?

  150. Alex in San jose Says:

    Doesn’t matter its just barbie and Ken in their cottage, and that jeep thing, set up in his mom’s basement.

    So yeah, 10% a month.

  151. 2million$shack Says:

    Came across this today:
    Silicon Valley apartment rents jump again in third quarter, but some cities see easing
    http://www.bizjournals.com/sanjose/news/2015/10/19/silicon-valley-apartmentrents-jump-again-in-third.html

  152. Alex in San jose Says:

    There are some fairly ghetto areas in Sunnyvale, Mountain View too. So yeah, when you’re sitting at a taquiria at Maude and Fair Oaks, watching some poor limping old Mexican dude push one of those heavy-ass ice cream carts, all the store signs have letters missing, and so on, its easy to see why rents may be a bit flat.

  153. Petsmart groomer Says:

    Alex, that’s not the Real™ Sunnyvale.

  154. Alex in San jose Says:

    Ha-ha Petsmart of course you are right, the only Sunnyvale that matters is the part where the streets are named after Impressionist era painters, silly me.

    I’m still pissed off at how they’ve turned downtown Sunnyvale into something out of RoboCop. They didn’t manage to apply the scorched earth policy to Murphy Street proper, but you know they wanted to. Funny, the name of the policeman who got turned into RoboCop was… Murphy.

  155. Dewane Says:

    Re: 140, my Chinese wife’s rich Chinese friend is actually putting her money here. I was just in Northeast China, and there are many, many building projects. I saw many of those huge multistory cranes, those L-shaped ones that look like gallows. And, I saw only one moving the whole time I was there. The problem (or benefit) of a centralized economy is, when Xi Jinping and the Communist Party says “stop everything now” in Beijing, everything really stops. Those projects aren’t going anywhere. I predict a hard landing, next year, because they didn’t take the hit in 2008, they thought things would go back to mega-growth, and that hasn’t happened everywhere. I’m not putting any investment in China because it’s a rigged game, even more rigged than here.

  156. Bill Lumberg Says:

    Dewane I’m always curious how the Chinese so easily skirt their government’s restriction on removing money from China. I believe they are limited to $50k yet they are buying up million dollar shacks in cash. Do you know how your wife’s friend happens to get her money out?

  157. Alex in San Jose Says:

    Lumberg – it’s been suggested on another site that the Chinese gov’t is allowing it for now as a sort of political safety valve.

    Also, think about it, who in China has the kind of money to spend on California real estate? Gov’t officials or those with connections to them.

  158. Real Estater Says:

    >>I believe they are limited to $50k yet they are buying up million dollar shacks in cash. Do you know how your wife’s friend happens to get her money out?

    Most people who can afford million dollar shacks have some type of business. Money can be transferred through business transactions. It’s fully legitimate and legal.

  159. Real Estater Says:

    >>The problem (or benefit) of a centralized economy is, when Xi Jinping and the Communist Party says “stop everything now” in Beijing, everything really stops. Those projects aren’t going anywhere. I predict a hard landing, next year, because they didn’t take the hit in 2008, they thought things would go back to mega-growth, and that hasn’t happened everywhere. I’m not putting any investment in China because it’s a rigged game, even more rigged than here.

    These statements are full of contradictions. If everything is rigged, there will not be a hard landing. Hard landing only happens in capitalist economies. What China did is very similar to what the U.S. did after the banking crisis. The Fed has been “rigging” low interest rates ever since, and we haven’t seen a hard landing here.

  160. Bill Lumberg Says:

    “Money can be transferred through business transactions. It’s fully legitimate and legal.”

    lol, it’s all puuuuuuuuurfectly legal. The only way I know Chinese using their business to launder money is over-invoicing.

    http://www.zerohedge.com/news/2015-05-04/how-chinese-oligarchs-used-fake-trade-invoices-launder-almost-1-trillion-globally

  161. Real Estater Says:

    Bill, is that the best you can come up with? Some opinion written by a bitcoin guy with the comments turned off? Do you know the magnitude of trade between China and U.S.?

  162. Bill Lumberg Says:

    http://www.economist.com/news/international/21601537-trade-weakest-link-fight-against-dirty-money-uncontained
    http://blogs.wsj.com/chinarealtime/2015/07/13/dirty-dealing-china-and-international-money-laundering/

    Are these reputable enough for you?

  163. Malcolm Says:

    Wow! This blog is STILL going! I haven’t visited it in years. And I see Real Estater is still trolling like a champ! I always wondered if he was a fictitious character created by the owner of the blog to keep traffic coming in.

    Either way, I have to thank him. Years ago, when I still lived in the Bay Area, it was his nonsense that finally made me realize that staying in Nor Cal was just not a good idea financially. So I opted to move to Austin, Texas. Note that I was someone who made some good money during the dot com crash. In the end, I bought a GORGEOUS 3000+ sqr foot home on an acre of land for $320k. Cash. Parked the rest of my money in 4.5% CDs (which they were at the time) and took a job at a local tech outfit.

    Fast forward to today and my home is now worth about $480k. My investments have grown by almost 35% and life is GOOD.

    Best decision I ever made was getting out of the crazy Bay Area. Don’t miss it one bit.

  164. burbed Says:

    But just think, if you had purchased that $320k home in the Bay Area, it would be worth $1M today!

  165. nomadic Says:

    Yeah, and it would just be a crappy condo in Milpitas.

  166. Alex in San Jose Says:

    Malcolm I’m pretty sure you knew someone to get a tech job, whether in Texas or here. Tech jobs are just not thick on the ground, and most pay very low – a person is better off going into the trades by far.

    But, good to hear things worked out for you. Save your money savesavesave …. because your tech job can go “poof” and then you’re vying with 100’s of others to get a job stocking shelves at the local Wal-Mart.

  167. Real Estater Says:

    Nice troll, Malcolm. Your house went up by 35% since the dot com crash? LOLLLLL!!! Your house will be back to square one when the next downturn hits, and your net worth will be $320K by the time you retire. I hope you can afford the air conditioning bills at that time.

  168. Ricky Says:

    Hi all, was a burbed fan in the last bubble, has since bought a house in Pleasanton (made a decent profit buying at the bottom, but unfortunately it has only gone up 15% from the last peak vs 150% for folks in Palo Alto).

    Enjoy reading burbed again now that we are in another bubble and looking to buy when the next recession hits. What do you guys think will happen with the next collapse? Last one wasn’t pretty, but Silicon Valley did quite well in the Great Recession.


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