No wonder California is called “The Golden State”
I hope you’re enjoy this Memorial Day!
As a community of people obsessed homes, we should also remember those houses that are still underwater.
Obviously, there are none in the Real Bay Area though…
Rent or Buy? The Math Is Changing
Billy Gasparino and Jenna Dillon-Gasparino were savvy enough to wait out the housing boom of a decade ago as renters. Not until 2010, well into the bust, did they buy a house in the Venice neighborhood of Los Angeles, less than a mile from the beach, for $810,000.
Only four years later, the couple see new signs of excess in the housing market and have decided to go back to renting. They are close to a deal to sell their house – for $1.35 million, a cool 67 percent gain.
Is it any wonder that California is called? Every house you touch turns to gold. And we all know that gold always goes up in value!
Since the start of 2011, prices have risen 33 percent in the San Francisco area, 30 percent in Miami, 24 percent in Los Angeles — and even more in some of the most desirable neighborhoods within those areas.
In the San Francisco Bay Area, home of the sharpest recent price increases, the sale price of a home is about 20 times what it would cost to rent a home of the same size for a year. That ratio, based on an analysis of data from Zillow, is the same as in 2003, when the San Francisco real estate market had yet to become an out-of-control bubble but was well on its way there.
That’s right! Based on data… DATA…there’s still plenty of upside for the homes in Silicon Valley.
But wait.. there’s more!
When low mortgage rates are taken into account, buying a home in San Francisco looks somewhat more attractive — but with a 10 percent down payment and prevailing interest rates, buying a home is 6 percent more expensive than renting a place of the same size, the same premium for buying as there was during the dot-com boom in 1999. Just two years ago, buying in the San Francisco area was 24 percent cheaper than renting an equivalent place.
There you have it! The NY Times says now is a great time to buy a home in San Francisco.
“If you thought home values in the Bay Area or Southern California were such that we might see another housing correction, that radically starts to advantage rental housing,” said Stan Humphries, Zillow’s chief economist, who argues that current prices are reasonably well justified, while acknowledging that prices are high enough to leave buyers exposed.
Even the Chief Economist at Zillow agrees!
This time it’s different. The economics have changed. The paradigm has shifted. House prices simply cannot go down.
I’m surprised you haven’t gone and picked up 6 houses over the weekend!
Belvedere Design House doesn’t sell, going up for auction
Lucky numbers in asking prices
Ah, Christmas time. The toys, the food, the eggnog, the family visits, the decorations, the lights, and of course, the tree. We wanted to find a simple ornament with a house for sale representation to wish you all a Happy Holiday, but instead, we found the ornament at right.
Now, if you have a Special Agent who you think would appreciate these thoughts on their tree, we swear we did not make this up. You can actually 
