[chassis]

Originally Posted by Joe T

I don't know how you Californians do it. We live in CT, where it's also expensive to live. My wife just interviewed for a job in Irvine, to get a single family home, not as nice as ours, with practically no land is $3+ million

The job pays about 25% more (on an already healthy East Coast salary) but homes are 3-4X the cost

strangely enough, the property tax on a $3mm california home and ours is about the same (we're about $22k a year on a home that's realistically $850K)

I interviewed with and received an offer from a company in Silicon Valley a few years ago. Nice step up in compensation but the housing and cost of living equation was a step backward. The executive I interviewed with (he is a Californian) told me, "you will not be made whole on housing".

I declined the offer.

In-migrants to California will experience a decline in financial standard of living in most cases, all things considered. The opposite is true for out-migrants from California, which is part of the driving force behind AZ, CO and TX being destinations for former Californians.

[Chick Webb]

Originally Posted by dreamingat30fps

I don’t understand this though… where did the work from home people live before they all became wfh??? I could understand people relocating to other areas, but I don’t see why the demand for housing would be any different. Also it seems prices are going up everywhere. It would make more sense if prices were dropping in areas people are moving out of and going up in areas people are moving into, but seems it’s all going up.

Also where is all the $$ coming from? How can these people now afford homes that are double or more what they were a couple of years ago? Along with affording the inflated prices for everything else? Is a side effect of catching the rona that your income automatically doubles??

We live on the coast just over the hill from San Jose. Many of the homes here were 2nd homes to begin with, but many of the sales in this area have been to people trying to get out of the valley since Covid started. They have used equity, stock, etc. to fund.

Imagine, for example, what you could do if you got in at Zoom before the IPO. Your 10,000 shares at $0.10 were worth north of $5.5 Million last year; that buys a lot of house, even after CA's ridiculous taxes. Multiply that by many people at many companies, and you've got a metric sh*t ton of money chasing not much inventory. According to Zillow (not that I believe their numbers so much) our home is worth 80% more than what we paid for it in 2015. And I haven't met the new neighbors yet, but a house (4 bd, 4 bath, 3800 sq ft) across from us just sold for $2.7M ($720 /sq ft) to a couple that looks to be in their 30s. And they've been remodeling extensively since they moved in.

Further, I think those huge windfalls have allowed most of them have kept their old homes for when they're back in the office, or are renting them for income. Because of that, there's no new inventory coming on the market and prices are going up both there and here. It's similar in other areas, like Lake Tahoe.

[zx10guy]

Originally Posted by dreamingat30fps

I don’t understand this though… where did the work from home people live before they all became wfh??? I could understand people relocating to other areas, but I don’t see why the demand for housing would be any different. Also it seems prices are going up everywhere. It would make more sense if prices were dropping in areas people are moving out of and going up in areas people are moving into, but seems it’s all going up.

Also where is all the $$ coming from? How can these people now afford homes that are double or more what they were a couple of years ago? Along with affording the inflated prices for everything else? Is a side effect of catching the rona that your income automatically doubles??

My question exactly when all this run up was happening...to include cars. But the video I've posted which no one has commented on discusses how some of the markets are being influenced by institutional investors. And it's not just this one Youtuber talking about this factor. There are others that are raising this issue too.

[premier3is]

Originally Posted by dreamingat30fps

I don’t understand this though… where did the work from home people live before they all became wfh??? I could understand people relocating to other areas, but I don’t see why the demand for housing would be any different. Also it seems prices are going up everywhere. It would make more sense if prices were dropping in areas people are moving out of and going up in areas people are moving into, but seems it’s all going up.

Also where is all the $$ coming from? How can these people now afford homes that are double or more what they were a couple of years ago? Along with affording the inflated prices for everything else? Is a side effect of catching the rona that your income automatically doubles??

I wish I could answer all your question but I'd love to know the answers myself. The only thing I can think of is due to work from home situations people may be saving elsewhere like food, gas, insurance, etc etc and want to move to a more comfortable place, small home. But to answer your question on how people are coming up with all this money all of a sudden, I have absolutely no idea myself.

[dreamingat30fps]

Originally Posted by Chick Webb

We live on the coast just over the hill from San Jose. Many of the homes here were 2nd homes to begin with, but many of the sales in this area have been to people trying to get out of the valley since Covid started. They have used equity, stock, etc. to fund.

Imagine, for example, what you could do if you got in at Zoom before the IPO. Your 10,000 shares at $0.10 were worth as much as $550 Million last year; that buys a lot of house, even after CA's ridiculous taxes. Multiply that by many people at many companies, and you've got a metric sh*t ton of money chasing not much inventory. According to Zillow (not that I believe their numbers so much) our home is worth 80% more than what we paid for it in 2015. And I haven't met the new neighbors yet, but a house (4 bd, 4 bath, 3800 sq ft) across from us just sold for $2.7M ($720 /sq ft) to a couple that looks to be in their 30s. And they've been remodeling extensively since they moved in.

Further, I think those huge windfalls have allowed most of them have kept their old homes for when they're back in the office, or are renting them for income. Because of that, there's no new inventory coming on the market and prices are going up both there and here. It's similar in other areas, like Lake Tahoe.

Ok so some rich silicone valley people with money to burn are buying up some of the inventory… but are those people really buying a smallish 2000 sqft home in the middle of nowhere FL for $500k or a tiny 1200 sqft house in NC for $300k?? I would imagine if you have all those millions to blow you would be buying something much nicer. Even with these crazy prices you could still get a very nice house in FL or NC for a few million. Why are all these regular houses blowing up? Are all these rich people wanting to live like the common man all of the sudden?

Also housing is insane, car prices are insane, prices of everything is insane, but apparently all the people doing these lower income jobs have decided not to work anymore and apparently we now have staffing shortages everywhere. So even though shit is more expensive than ever, all these people just decided not to work anymore and yet the streets are not filled with all these new homeless people???

I dunno but I’m 90% certain some shady shit is going on.

[bayarea328xit]

Originally Posted by Chick Webb

Imagine, for example, what you could do if you got in at Zoom before the IPO. Your 10,000 shares at $0.10 were worth as much as $550 Million last year ...

Zoom peaked at around $600/share --> $6 million; you are off by a factor of 100 if you assume 10,000 shares. Not sure if you were assuming 1,000,000 share grant.

[evil-G-nius]

Not on the same levels as the topic has turned here but...our house that's still under construction, our model is now selling for 35K more than what we paid for ours! That is a huge jump in a little over a month! That is nuts to me

[vreihen16]

Originally Posted by evil-G-nius

Not on the same levels as the topic has turned here but...our house that's still under construction, our model is now selling for 35K more than what we paid for ours! That is a huge jump in a little over a month! That is nuts to me

Watch out for the builder voiding the sale before you close, and selling it to someone willing to pay more! It's been happening for a year or more, according to news reports.....

[M_Six]

We must be living in a time warp bubble. There are a ton of starter homes here for under $100k. Top end McMansions are still sub-$1mil. Check Zillow for area code 61920. Yes, the prices for top end homes here have jumped considerably in the past 5 years, but still, nothing like what's happening on the coasts or big urban areas.

[Chick Webb]

Originally Posted by bayarea328xit

Zoom peaked at around $600/share --> $6 million; you are off by a factor of 100 if you assume 10,000 shares. Not sure if you were assuming 1,000,000 share grant.

Missed a decimal there. Thanks for pointing that out. Anybody know where I can get a new proofreader?

[Chick Webb]

Originally Posted by dreamingat30fps

Ok so some rich silicone valley people with money to burn are buying up some of the inventory… but are those people really buying a smallish 2000 sqft home in the middle of nowhere FL for $500k or a tiny 1200 sqft house in NC for $300k??

Likely, not. I suspect a lot of that is investors (which could of course be rich silicon valley people) buying up homes to then rent, or simply a less-affluent version of the same thing I described. There's a lot of home equity out there and for better or worse it's likely being used.

As to where the money's coming from, well, we have printed several trillion dollars in the last couple of years. Just sayin...

[Chick Webb]

Originally Posted by M_Six

Yes, the prices for top end homes here have jumped considerably in the past 5 years, but still, nothing like what's happening on the coasts or big urban areas.

That's because you live in central IL, man. What's the high gonna be there today? 40, maybe? Yesterday I went for a walk on the beach, in shorts and a t-shirt, after washing the car and doing a little light yard work. That's gotta be worth somethin.

[RickFLM4]

Originally Posted by Chick Webb

Likely, not. I suspect a lot of that is investors (which could of course be rich silicon valley people) buying up homes to then rent, or simply a less-affluent version of the same thing I described. There's a lot of home equity out there and for better or worse it's likely being used.

As to where the money's coming from, well, we have printed several trillion dollars in the last couple of years. Just sayin...

This and also, even with the run ups in cost over the past 2 years, in some places they are making up for a long period of stagnant prices following the financial crisis. We have been in our house for almost 20 years. Over the past 2 years, the value has increased by 25+%, driven mainly by New Yorkers relocating and equestrians buying second, third or fourth homes. Lots of cash deals. However, if you look at the full 20 year period, the annual price increase is more like 3.5% (edit: less once you factor in investments we have made). Still healthy, but the last two years viewed in isolation don’t tell the whole story. Some areas were genuinely bargains before the run ups started.

Also, someone mentioned inflation not being a factor and that isn’t true. Builder costs have increased (labor, lumber and everything else as anyone doing home projects knows), which pushes up prices of new homes, which pushes up prices of resales. High demand and low supply support the price increases, but hard to say inflation has no impact.

[ASAP]

I can give you guys an example of where my family lives in FL-

The mass migration of Northerners and Westerns down has caused a massive spike in prices that we had not seen the prior 20 years. Where they live was always a decently priced area by the water where homes ranged in the 150s to low 200s at the upper end. Their homes appreciated by at best 80-90k over 20 years.

Today or at least in the past 3 years, prices have spiked so drastically that $400k homes are now normal... but remember the local economy household median income is barely $50k. In other words locals are no longer running the housing markets.

This is devastating to local people as-

Rents have doubled recently.
Home insurance costs have gone up significantly.
If anyone moves, taxes spike massively.

No one local will soon be able to afford anything, not sure how any of this is sustainable in the long term. There has been no wage growth and no real influx of jobs.

Actually just confirmed +72% in real estate costs over 5 years.

[M_Six]

Originally Posted by Chick Webb

That's because you live in central IL, man. What's the high gonna be there today? 40, maybe? Yesterday I went for a walk on the beach, in shorts and a t-shirt, after washing the car and doing a little light yard work. That's gotta be worth somethin.

Agreed. It's almost always about location. But there are pricey houses in other areas that have shit weather. We just have the perfect combo of shit weather, no decent restaurants, no decent shopping, and 2-3 hours from a major airport.

[RickFLM4]

Originally Posted by ASAP

I can give you guys an example of where my family lives in FL-

The mass migration of Northerners and Westerns down has caused a massive spike in prices that we had not seen the prior 20 years. Where they live was always a decently priced area by the water where homes ranged in the 150s to low 200s at the upper end. Their homes appreciated by at best 80-90k over 20 years.

Today or at least in the past 3 years, prices have spiked so drastically that $400k homes are now normal... but remember the local economy household median income is barely $50k. In other words locals are no longer running the housing markets.

This is devastating to local people as-

Rents have doubled recently.
Home insurance costs have gone up significantly.
If anyone moves, taxes spike massively.

No one local will soon be able to afford anything, not sure how any of this is sustainable in the long term. There has been no wage growth and no real influx of jobs.

Actually just confirmed +72% in real estate costs over 5 years.

So houses that were $150K to low $200’s 20 years ago are now $400K+? If that’s the case, it doesn’t seem unusual to me. But it does make a case for people to stay in their homes rather than selling and moving elsewhere where they will take a property tax hit for a home of equal value.

[ASAP]

Originally Posted by RickFLM4

So houses that were $150K to low $200’s 20 years ago are now $400K+? If that’s the case, it doesn’t seem unusual to me. But it does make a case for people to stay in their homes rather than selling and moving elsewhere where they will take a property tax hit for a home of equal value.

5 years not 20. The prior 20 years saw minimal YoY growth.

[RickFLM4]

Originally Posted by ASAP

5 years not 20. The prior 20 years saw minimal YoY growth.

If homes barely appreciated for 2 decades, they became bargains when real estate heated up, so part of the rapid appreciation over the past 2-5 years is making up for those 20 neutral years.

South Florida took a very long time to work through excess inventory and foreclosure sales and now the tide has turned and home values became attractive. When you consider the trillions that have been printed, stock market gains and interest rates that have been low for an unusually long time, it isn’t a surprise that the last 5 years look a lot different for housing prices than the 10 years that preceded them.

[evil-G-nius]

Originally Posted by vreihen16

Watch out for the builder voiding the sale before you close, and selling it to someone willing to pay more! It's been happening for a year or more, according to news reports.....

Heard about that too and I think we are already locked in. There were specific builders that were doing that...luckily our builder is not one of those doing that. Not to mention, I'd make sure my attourney sued the shit out of them if they did. LOL

[OkieSnuffBox]

Originally Posted by dreamingat30fps

I don’t understand this though… where did the work from home people live before they all became wfh??? I could understand people relocating to other areas, but I don’t see why the demand for housing would be any different. Also it seems prices are going up everywhere. It would make more sense if prices were dropping in areas people are moving out of and going up in areas people are moving into, but seems it’s all going up.

Also where is all the $$ coming from? How can these people now afford homes that are double or more what they were a couple of years ago? Along with affording the inflated prices for everything else? Is a side effect of catching the rona that your income automatically doubles??

I'll give an example from my own personal situation.

Previously my fiance worked in an office full-time, I worked from home 2-3 days per week. We have a 3/2/2 home. Since COVID started March 2020 I've been working from and they closed our local office last month, so it's permanent unless I decide to change companies, which I wouldn't do unless it was a nice raise AND I was still WFH.

Her current and previous job were WFH and with what she does, no reason she will go back to an office either unless it's a BIG pay raise. We both need separate office spaces, so she has a sort-of office in the last bedroom, whereas the larger of the 2 extra bedrooms was already my office/sim rig/guitar room.

So a 4 bed house, or 3 bed with an office, would be excellent. However, I'm VERY conservative with what I'm willing to spend on a home. I know OKC is cheap and I don't make a ton. I paid $156k for a fully renovated 3/2/2 in Sept 2017. That's about what our gross was last year, and I'm comfortable with that. I like having plenty to spend on BS.

But at this point, I don't even have a play car anymore. It seemed stupid to keep it as the first year of COIVD I literally put 900 miles on it. It was basically an occasional cruise/take it brunch vehicle.

So no commutes, 1 car, decent income for OKC.........we could afford A LOT more house, but I refuse to pay these inflated prices, so we are just dealing it with for now. Our only debt is the car payment and the mortgage and those two combined are only $1400/month.


I'll probably end up buying something stupid at the end of the year or next year and we are just going to start road tripping like crazy. We've also considered the "sell the house, buy a big truck and camper" thing, but we have 3 dogs and a cat.....so that would be more difficult.

[Alfisti]

Originally Posted by OkieSnuffBox

I paid $156k for a fully renovated 3/2/2 in Sept 2017.

That is the greatest purchase of all time. Good god.

[OkieSnuffBox]

Originally Posted by Alfisti

That is the greatest purchase of all time. Good god.

OKC was/is pretty cheap compared to the other cities in the 20 largest in the country........but even now stuff is getting silly here and I don't know what these people are doing to afford these homes.

Although I guess if I bought what the "Bank" says I can afford I'd be looking in the ~$375-425k range. But I have a feeling as inflation continues to go crazy, people who are buying at the absolute limit of of the debt-to-income ratio aren't going to be able to deal well with the increasing prices in gas, food, etc.