This article caught my eye in the New York Times over the weekend – it’s about Sathish Pottavathini, an engineer at eBay, and his Bay Area Housing Plan:
Hoping for Best in Home Sales, 2 Sides Sit Tight – New York Times
In the San Jose, Calif., area, where the average house price increased 21 percent last year, Sathish Pottavathini, a programmer at eBay, said he was taking his time with the search for a new home and trying to find a good deal.
“I don’t want to rush into things especially in this kind of situation,” Mr. Pottavathini, who is 32, said, “where you hear about a slowing down everywhere.”
He and his wife, Madhuri, spend $1,200 a month renting an 800-square-foot two-bedroom apartment, where they live with their 21/2-year-old daughter, Siri. They would like to find a three-bedroom town house with a two-car garage for less than $500,000.
Although he does not expect prices to fall significantly, he does not think they will rise either and hopes he can find a bargain — a goal that seemed all but impossible in Northern California in the last few years. Now, Mr. Pottavathini said, “If I wait, I might get a better place.”
… [silly impossible comments about how house prices sometimes drop removed] …
Mr. Pottavathini, meanwhile, is giving his San Jose search four months. After that, he plans to take a break and wait until his daughter is a bit older and his wife returns to work. With more money coming in, they might be able to pay more.
If they still have not succeeded, they would then consider leaving Northern California — which he called “the best place in the world” — and returning to their native India.
“If the condos become $600,000, it doesn’t make any sense to live here,” he said. “Imagine owning a house and paying your whole life for that house. I would rather move back to India.”
But wait a minute… if this is the best place in the world, then wouldn’t it be worth it to spend your entire life paying for a condo?
After all, with just a mild rate (for the Bay Area) of 10% appreciation a year… that $500,000 condo would be worth $4,924,866 by just 2030! That’s $5 million at stake!
Come on Sathish, how could you even consider leaving the best place in the world? Think of the children!