A few weeks ago, there was this exchange:

Five Reasons Houses Beat Stocks [Burbed.com]
Crossroads Says:
February 20th, 2008 at 6:08 pm

Hello RealEstater,

I need your wisdom. I make a standard starter Valley salary (125k) ,I just bought a new Sienna for the children (800 a month) ,and I have some money from stock (150k).

The calculator at Move.com shows that I can afford a 577,767$ house. There are no houses in Palo Alto for that price.

RealEstater, what should I do? Where should I buy?

The reply?

RealEstater Says:
February 22nd, 2008 at 2:34 pm

Crossroads,

First of all, you should’ve paid cash for the Sienna, but let’s work with what you’ve got.

You make over 10 grand a month. That means very conservatively you can afford $3K a month of payment. Working backwards, you can borrow somewhere in the neighborhood of $500K, although up to $600K is doable.

With a down payment of $150K, you can afford a home in the $650K-$700K range. You can buy a house in any number of neighborhoods within Santa Clara, Sunnyvale, or San Jose.

You’re not going to make it to Palo Alto right away, unless you want to live in a Condo. Palo Alto is considered a “destination neighborhood”. You get there only after trading up a couple of times.

In other words, you’re in a good position to own a home. I don’t see you as being priced out.

Good advice? Bad advice? Do you agree with Real Estater?
What would you tell Crossroads to do?

Vallejo-area housing market improves, prices decline statewide – Vallejo Times Herald
That the local situation differs from what’s going on statewide doesn’t surprise Solano Association of Realtors president Lori Collins.”Each area really represents sort of a microcosm, and different areas behave differently,” Collins said. “The market is actually booming in San Jose and San Francisco, and it’s picking up here, but it’s not crazy here, yet.”Collins and Benicia mortgage broker and City Councilman Alan Schwartzman of Advance Mortgage, said the area has been experiencing increased sales for the past several months. And both said they are cautiously optimistic the trend will continue.

“We’re seeing a pickup. There are definitely more buyers. There are multiple offers on properties. We’re starting to get buyer calls we haven’t been getting for months and months,” Collins said.

WOOT! Did you hear? It’s booming here in San Jose and San Francisco! BOOMING.

My god I’m so glad we hit bottom in January and the Spring Bounce is here to stay!

It’s only going up babyyyyyyyyyyy!

(Thanks to TheHousingBubbleBlog for this find.)

To help fight the comment spam, I’ve had to add a new requirement to adding comments: you now have to solve a simple math problem.

If you have any problems, please e-mail me. Thanks!

#91 San Francisco « Stuff White People Like
The city is considered one of the world’s premiere locations for white person research.

White people like to vacation in San Francisco because it has beautiful architecture, fantastic food, and it is near the water. They like to live in San Francisco because of its abundance of Non Profit Organizations, Expensive Sandwiches, Wine, political outlook, and most importantly its diversity.

Since many white people either live in, plan to move to, or closely identify with San Francisco it is imperative that you know how best to deal with them.

The City of San Francisco has a very multicultural population that ranges from white to gay to Asian. Within white culture this known as “ideal diversity” for its provision of exotic restaurants while simultaneously preserving property values. The presence of gays and Asians is imperative as it two provides two of the key resources most necessary for white success and happiness.

OH MY GOD. The Real Bay Area was featured on Stuff White People Like.

Spring Bounce + Stuff White People Like = Crazy Appreciation!

Stanford College Grads Salaries supports house prices
Undergrad Says:
March 22nd, 2008 at 12:19 am

I think in general the packages for CS students are high in the US : I myself am finishing my undergrad degree (in a top school in Asia) in CS in a month and have an offer from one of the the big 3 software companies (at an office in N America) with a first year cash compensation that’s in 6 figures USD (excluding the stock and annual bonus).

I just wanted to make sure everyone saw this comment. Further proof that The Real Bay Area is saved.

How long have you lived in the Bay Area? [Burbed.com]islandboy Says:
March 20th, 2008 at 2:07 pm

I think a family with 150K income can buy an average house. A family with 100K can buy a small house (think 2bd/1ba) or condo, although they may be better off renting. If tenspeedsf makes 110K, and her husband works, they should make well over 150K.

150K per family is roughly 90K after fed/ca taxes, SS, medicare, or 7500/mo. If you buy a house with a 750K loan at 6.5%, your PITI is roughly 4700 800 property tax = 5500. After tax benefits on interest and property tax, which is roughly a 30% discount, your per month housing expense is roughly $4000. That leaves you 3500/mo to play, eat, shop, save.

With salary increases and inflation, that payment will become more comfortable over time.

I’m not saying that’s exactly what I would do, But it wouldn’t be outrageous or irresponsible as long as that family is planning to stay in the house long term.

What do you Readers think? Good idea? Bad idea? Resonable? Unreasonable?

Wow… lots of great comments lately!

So much so that I’ve added a list recent comments to the sidebar so you can easily see what the last few comments were.

And remember: let’s please keep the comments civil!

Reports

814 HARPSTER DR
Mountain View (Mountain View) 94040
Attached Single Family (Class 1)
Bed/Bath: 3 / 2
SqFt: 1,217
Lot: 5,076 sq ft
Age: 58 years
List Price: $949,000
Assoc Fee:
Live near downtown Mountain View. Walk to parks and Pete’s Coffee. Great home with decent sized lot. Clean and well landscaped. Room in price for your improvements on kitchens and bathrooms to turn this into a real GEM. Newer roof and HVAC.
Lot size has been corrected to reflect County records. With 5076 sf well landscaped, you are ready to enjoy this home from the start. Even if you have only the slightest creative abilities, you can see that the basic layout of this home provides any buyer an opportunity to really do some fun things on the interior with bathrooms and the kitchen. This is a home that I would want to own myself. As a licensed General Contractor, I see this home as being easy to work on and improve to that million dollar level that other comps on the market are priced at. If you look at size and location, it has all of that. It doesn’t take a whole lot of imagination to see the potential in this home. I would be happy to show this home anytime. Feel free to call me with any questions. There should be some flyers in the box out in the front of the house. By the way, the owners are willing to get creative with financing. All of which would be subject to lender approval.

So let me get this straight… with some work, this million dollar house can be as great as… a million dollar house!

WOW! What an opportunity!

That’s the one advantage homeowners have over renters: freedom to improve their housing. Poor renters, never able to spend money on their residences, never being able to spend their weekends mowing the lawn, fixing the roof, fixing the bathroom, or fixing the kitchen. They’re just throwing their money away when they could instead be investing in assets like remodelling.

Talk about a deal!

Over the weekend I asked for people’s thoughts about living in the Bay Area. This comment right here is proof why real estate prices have no choice but to double in the next decade. Check it out:

How long have you lived in the Bay Area? [Burbed.com]

mrbogue Says:
March 17th, 2008 at 11:46 am

I friggin’ love the Bay Area. Lets see, compared to the places i’ve been in..

London, UK: Hot in the summers, Rainy in the winters, nice city, but horribly expensive (unless you’re the MAN). People seemed blunt yet nice though.

Manhattan, NY (the mexico of Londoners): Hot in the summers, Rainy/Snowy in the winters, nice city, but pretty expensive (not as much as London I guess) and even if you’re mediocre wealthy you feel really poor here. Seems pretty diverse.

Florida: I dunno, it was friggin’ storming/hurricane/gail winds. Not desirable at the time.. But had some good Cuban sandwiches.

Philippines: HOT, HOT, HOT, and you can get robbed at knife point or jacked at almost every corner in the city at all hours of the day.

Thailand: In the cities: HOT as hell, smoggy as hell, and this was during the cool season. Food even at sit-down restaurants lacked cleanliness, found lots of bugs in my food (though cheap) alot of nose-picking/flipping in public places.

Taiwan: F*cking dirty, Smoggy, sometimes people smell bad. Somewhat Violent now in the cities.

Boston, MA: Being Asian I never felt racism in restaurants until I went to Italian Restaurants in this town. I guess Asians need to know their place in Boston. *NOT DESIRABLE*

Hawaii: Beautiful place, but not alot of jobs, pretty diverse (leaning toward lots of asians).

Texas: Dry and hot as hell. Good BBQ I suppose. They really love football down there, but i’m not a big football fan so…..

Indiana: Corn fields as far as the eye can see. Weather felt strangely like Thailand = bad.

Las Vegas, NV: Everytime i’ve been there its been hot as crap, and its just a desert town with a juicy dice rolling center. Weather sucks.

Reno, NV: Its like Vegas, but poor trailer park trashy.

Eugene, OR: The weather was nice, the coffee was good, the Pad Thai?? was good.. The weather was great (I was there during the summer) I guess this one was as close as the Bay Area it can get.. but I had the feeling there weren’t too many jobs, and didn’t feel it was very diverse.

Winnipeg, Manitoba: So cold you have to jump from one building to the next to stay warm, and when you wake up in the mornings the static literally lights up your bed like an amusement park at night.. creepy. The people are uber-friendly though.

Phoenix, AZ: F*cking HOT, nice city though.

Tahiti: I don’t speak french, the place is uber-expensive, and tahitians are somewhat xenophobic. They have some damn fine beach front property however, if you’re ready to drop $2MM for a sliver of land.

Anyhow compared to these places, the BA is still the perfect balance of quality weather, diversity, and employment. I’m not sure if its worth living anywhere else at this point.

Agree? Disagree? Post your comments in that thread, not this one.

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