This site does not get out to the East Bay enough.  Thanks very much to Burbed reader Jeremy from Hayward for doing the legwork for us, with this vintage villa in Castro Valley.  Remember, if you want us to cover more hella-fine houses from your hometown, be sure to send some in!

Today’s house is one you may be able to pick up with your income tax refund.  Now who says there isn’t affordable housing in the Bay Area?

5939 E Castro Valley Blvd
Castro Valley, CA 94552
$199,900

BEDS: 3
BATHS: 1
SQ. FT.: 1,390
$/SQ. FT.: $144
LOT SIZE: 1.74 Acres
TYPE: Detached
STYLE: Contemporary
STORIES: 2
YEAR BUILT: 1900
COMMUNITY: Castro Valley
COUNTY: Alameda
MLS#: 40567572
SOURCE: EBRD
STATUS: Active
ON REDFIN: 16 days

Bank Owned !!! CONTRACTOR Special !!! Home needs Extensive repairs or may need to be torn down. LOT’s of POTENTIAL for this 1.75 acre lot.

Here’s why Jeremy sent us this classic structure:

All I can say is Best. Addition. Ever!!!

No Kitchen? Need extra space? No problem! In the East Bay we just knock out a wall and drive our RV up next to the house, some duct tape, and viola! Mama’s new kitchen!

Oi….at least it’s not $1million!

This has got to be a whole new level of WTFness, even if it didn’t have that lovely support post right next to the RV entrance.

Here’s another view of the RV.

Hoe.  Leigh.  Crap.

Jeremy followed up with:

Do you get a break on a combined auto/home policy for this?

Do you pay property tax or car registration?

It is pretty spectacular. Loving the retro dwell-ready colors on the RV as well….

Be sure to head over to the listing, because there are plenty more photos, although most are of the house without an RV parked in the middle of it.

Lot’s of POTENTIAL, indeed.  Too bad the listing doesn’t specify if the RV stays.

Bunus: Location, location, location!

13990 Quito Rd, Saratoga, CA 95070 – Property Details.
13990 Quito Rd, Saratoga 95070
| Virtual Tour

Bedroom: 2 Bathroom: 1 MLS#: 722670 Square Footage: 996 $799,000
Status:
Active
Year Built: N/A Parking Spaces: 1 List Date: 4/30/2007 Lot Size: 6969
Open: Sat 13:00 – 16:00 Sun 14:00 – 16:00
DESCRIPTION -
13990 Quito Rd, Saratoga
Great price and Opportunity to remodel existing home or build new. Priced to Sell. Need 1 hr notice to show. Please call first to schedule then show. excellent location to Marshall Lane Elem. West Valley College, shopping

The fact that no interior pictures were included is sort of a red flag. But also, what’s going on above the door there? Are some planks missing or is that just a strange design?

To be fair, it’s on a pretty big lot – so just think, all you need to do is knock this down and start anew – then you’ll instantly have a $1.3 million dollar house! in Saratoga!

Isn’t that what you always dreamed of?

Happy Memorial Day! Here’s a great bargain for you bargain shoppers!

318 Dale Dr, San Jose, CA 95127. San Jose Real Estate/Home for Sale.
318 Dale Dr, San Jose 95127

Bedroom: 1 Bathroom: 1 MLS#: 720250 Square Footage: 576 $499,000
Status:
Active
Year Built: N/A Parking Spaces: 2 List Date: 4/18/2007 Lot Size: N/A
Open: Sat 13:00 – 16:00
DESCRIPTION -
318 Dale Dr, San Jose
GARAGE CONVERTED TO 3BED/2BATH. PERMITS UNKNOWN. DO NOT SHOW UNTIL 4/25/07 OWNER IS CURRENTLY REMODELING THE HOUSE. NEW BATHROOM/ WINDOWS AND PAINT. HUGE LOT!!!. GREAT HOME FOR TWO FAMILIES.** OPEN HOUSE 5-12-07** 1PM-4PM**

That’s right! This 576 sqft home is PERFECT for 2 families! Park an RV and a boat, and it might be great for 4 families.

You were waiting all year for this deal – buy now!

As you may recall, last Thanksgiving I found that the exact same groceries at Safeway in the Bay Area were more than the exact same groceries at Safeway in Redmond, WA.

The point of this comparison was to see how Apple/Sony would compete against Nintendo/Microsoft. In that study, I found that on average, groceries cost 20% more here than there.

Which makes sense – have you seen Apple’s stock price? Have you seen our great weather? Of course grey poupon should be 30% more expensive here than there. Grey poupon is simply better here!

Well, Memorial Day is coming up, so I thought it would be fun to come up with a comparison for a BBQ. But to add a twist, I decided to compare groceries in the Cupertino, to groceries in Redmond, Washington – as well as Washington DC!

Yep, that’s right! There are Safeways there – and they sell the same Safeway Select stuff there. The Capital of Innovation versus the Capital of Politics vs the Capital of Rain.

Let’s take a look:

	Cupertino	DC	Difference		Cupertino	Redmond	Difference
Charcoal	4.99	3.69	35%		4.99	3.99	25%
A1	8.23	5.99	37%		8.23	5.45	51%
Foil	3.49	2.99	17%		3.49	3.49	0%
Butter	3.00	3.00	0%		3.00	3.00	0%
Pickles	3.69	2.99	23%		3.69	2.85	29%
Large Tomatoes	1.50	1.50	0%		1.50	1.25	20%
Corn on the Cob	3.19	3.29	-3%		3.19	2.99	7%
Pork Should Ribs	5.58	7.38	-24%		5.58	3.58	56%
Sausages	5.29	5.50	-4%		5.29	5.49	-4%
Coke	5.49	5.49	0%		5.49	5.49	0%
Ruffles Chips	3.49	3.49	0%		3.49	3.49	0%
Olive Oil	10.46	8.79	19%		10.46	8.39	25%
Dinner Rolls	0.39	0.55	-29%		0.39	0.39	0%
Ribeye Steak	10.99	11.99	-8%		10.99	10.49	5%
Ketchup	3.59	2.69	33%		3.59	2.59	39%
Mustard	2.49	2.04	22%		2.49	2.31	8%
Relish	1.49	1.49	0%		1.49	0.99	51%
Oscar Mayer Franks	4.99	4.29	16%		4.99	4.49	11%
Hot Dog Buns	1.69	1.19	42%		1.69	0.99	71%
Lettuce	1.49	1.79	-17%		1.49	1.59	-6%
Potatoes	0.32	0.25	28%		0.32	0.25	28%
Cucumbers	0.99	0.66	50%		0.99	0.99	0%
Chili	2.09	1.99	5%		2.09	1.86	12%
Appie Pie	6.99	5.99	17%		6.99	5.99	17%
Peach Pie	6.99	5.99	17%		6.99	5.99	17%
Ice Cream Sandwich	5.99	5.29	13%		5.99	5.49	9%
Paper Plates	2.19	1.99	10%		2.19	1.89	16%
Cutlery	1.99	1.99	0%		1.99	1.99	0%
Garbage Bags	7.99	7.59	5%		7.99	7.49	7%
	Average:		11%		Average:		17%

Woot! We win again! Groceries here are 11% more expensive than Washington DC, and 17% more expensive than Redmond, Washington.

Woot! We’re #1! We’re #1! Hurray! Huzzah!

Now, I know what you’re thinking: “WTF? Houses are 2x more expensive than renting, and now groceries are more expensive than in Washington DC, and Washington state – where they don’t even have an income tax? WTH am I doing here???”

Before you consider leaving the Bay Area, just remember that they don’t have any Chinese restaurants, Korean restaurants, Japanese restaurants, Thai restaurants, Vietnamese restaurants, gay-friendly, smart people, diversity, tech companies, snow sports, hiking, mountains, universities, In-n-outs, or 9 months of sun. And let’s not forget our cheap housing, amazing public schools, great roads, low taxes, lack of traffic, and our Governator.

I hope your BBQ turns out well!

MLSlistings Property Detail for MLS number 710942
1286 MICHIGAN AV
San Jose, CA 95002$419,900This Single Family Residence has the following features:
MLS#: 710942 Approx Age: 58 Years Approx Sq Ft: 991
Detached Single Family 1 Story Cottage/Bungalow

Well, so the house looks a little run down… that’s no big deal. Fixer upper… blah blah blah. I never liked grass anyway.

But click inside and then you get this:

Wow. Nothing says perfect starter home for young Bay Area families like this. Or, if you’re getting ready to deploy to Iraq, this would also be a great place to practice house to house searches!

All yours for $419,900.

Are those tears of joys I see?

Update: I forgot to post the sales history!

Sale History
07/10/2006: $344,845
08/09/2004: $385,000
06/22/2004: $229,000

Wow… this house gets better every year!

If you ask ask most people in the Bay Area “Why did homes get so expensive in the last few years?” you’ll probably here these reasons:

1. It’s not a bubble: They’re not making any more land. It’s special here. (Who knew that land suddenly decreased?)
2. It’s not a bubble: Weather. It’s special here. (Who knew that the weather suddenly got so much better?)
3. It’s not a bubble: Everyone wants to live here. It’s special here. (But why so much so in the last few years?)
4. It’s not a bubble: Web 2.0, Google, The Valley is BACK! Oh, and it’s special here.

The last one is distinctly possible. Google IPOed in 2004, instantly creating thousands of millionaires/billionaires. The job market has picked back up. Traffic is back with a vengeance.

Ok, so maybe that explains these two graphs:

The data for these graphs are from this Wells Fargo site – for some reason they don’t include data for the year 2002.

• The red line is the median income, and as you can see it’s pretty high around here.
• The green line is the median home price, and as you can see it’s pretty high around here.
• The blue line is the price/income ratio: median home price divided by the median income – multiplied by 100 so that it shows up on this chart. (Otherwise, it’d be like 3.)
• The purple line is what I think the home price should have been, using a trailing average of price/income ratio multiplied by the income.

Ok, with that said, let’s look at the graphs above. Right now, the price/income ratio in San Francisco is about 8.32 and in San Jose it is 6.75.

But why now? In San Jose, it used to be about 4x. Why the dramatic spike in 2004?

This is when most people would say “Duh! It’s because the job market picked up in the Bay Area! Have you tried hiring someone?” and “Gooooooooooooogle!”

That’s sort of true… but how does that explain this?

That’s right – Los Angeles had a spike around the same time. So… maybe LA also became a lot more desirable and employed at the same time the Bay Area did. That’s stretching it… but maybe that’s what happened. They also have tech jobs there too…

But wait…

Why look at that… Las Vegas has the same sudden bump as San Francisco, San Jose, and Los Angeles. Ok ok… Las Vegas is really a suburb of Los Angeles, and so maybe the job market in San Jose was so strong that it carried through all the way to Las Vegas.

But wait…

Seattle isn’t near SF/SJ/LA/LV – but yet they have the same bump there too. Oh right… forgot… tech job market. Strong. So strong in the Bay Area that it made prices in Seattle go up too. And thus Portland too.

But wait…

Huh? Boston has the same sudden spike too! Oh right… tech jobs again! Ok ok… so the job market in the Bay Area was so strong, it made prices in LA (and its suburb, LV) go up, and also Seattle and Boston too. We’ll ignore the fact that the red-lines for all of these places show little-to-no increase. But yeah… the Bay Area became so desirable that the Bay State went up too.

But wait…

Chicago too! They have a bump then too! That’s because… um… the Bay Area job market…. and…. um… oh right! Motorola introduced the Razor, and Motorola is located near Chicago. That’s why prices suddenly spiked up there. (We’ll ignore the fact that incomes sort of went down during that time…)

But wait…

Washington DC and Baltimore have the bump too! Well, DC does include Northern Virginia (NoVA) which is kind of techy – so their bump is because of Silicon Valley’s specialness. Baltimore… uh… well… The Wire was pretty good those years so maybe that was just a fluke.

But wait…

New York City metro has the same spike too. Um… that’s because… um… Google! Yeah! Google got into ads, which drove… um… down… ad sales in NY…. which… um…. drove up housing prices. Perfect. Check. Strong Job Market in the Bay Area. Got it!!

So there you have it!

Home prices in the Bay Area surged in the last few years because of the strong job market and the increased desirability and suddenly shrinking amount of land. The tech recovery was so strong that it streamed out and caused a spike in home prices in second-tier cities like Los Angeles, Seattle, Chicago, Boston, DC – which in turn caused prices to go up in their suburbs of Las Vegas, Portland, and Baltimore to have the same spike.

The job market was so strong, that incomes somehow managed to stay flat while housing prices soared. Again, this is not due to a bubble, but because the job market was strong. Ignore the income lines. Only focus on the price lines.

Make sense? It’s 2.0! The paradigm has shifted! These are the new economics! The Bay Area is special!

For amusement’s sake, let me put forth an alternative theory: prices in the Bay Area surged just like they did in so many other cities across the nation, because of a boom in easy credit and low interest rates – not because it suddenly became so desirable. Possible?
Have a good weekend!