Home sweet home -- impossible? Californians fear high prices may drive young people away

San Francisco Chronicle ^ | 11/18/4 | Kelly Zito

[SmithL]

More than 50 percent of California residents said in a survey being released today that they are very concerned that fast-rising home prices will lock out younger generations from the housing market.

That trend already appears under way for those ages 18 to 34, with 31 percent saying high housing costs are forcing them to ponder a move from their region or out of the state, according to the study by San Francisco's Public Policy Institute of California.

Researchers at the nonpartisan think tank say an exodus of young workers could undermine state's economy, especially in the Bay Area, which relies on a skilled, mobile labor pool to drive its dominant technology industry.

"If the younger adults are thinking about moving out of a metro area like the Bay Area, the question is, where do you get the workforce?" said Mark Baldassare, the institute's director of research. "Who's going to come in and replace the skilled workers that we're going to need for our economy?"

[Flash Bazbeaux]

"The only "reasonably" priced homes are in bad neighbors in Richmond and the like.


And even THAT is starting to change. I wouldn't be surrpised that former bad places in the Bay Area like Richmond, much of Oakland, much of San Francisco, and East Palo Alto rapidly gentrify because of people moving in and renovating whole neighborhoods."

This is already happening.

I've spent almost every weekend the past four months looking in Oakland. North Oakland, near Berkeley, is already gentrifying, with the increase in prices, and improvement in neighborhoods, moving out in waves from Telegraph Avenue west toward Emeryville. At first we were outbid by a mile -- even though we were offering well over the asking price. Then we got "in the ballpark" which meant we were invited to participate in a bidding war on a house that was listed for $379,000.00 and needed $30,000.00 of work. We offered $424,000.00 We were told that we were one of four offeres that was being asked to submit a new offer of not less than $430,000.00. We said forget it. We finally got a place in another part of Oakland by offering 50,000 over asking -- the house got ten offers. Luckily the monthly payments are not going to be backbreaking, but that is because my wife and I have saved every spare penny for the past four years since we got married, and I got some help from my parents. And our new neighborhood is no prize.

The good thing about the neighborhood IMO is that it is very close to a Christian college which is an anchor for the neighborhood. The people we bought the house from are associated with it, as are some of the neighbors. I am not a big bible thumper, but I sure don't mind having them in the neighborhood -- their clout helps to keep the neighborhood stable and the streets more safe.

[Betis70]

>>That puppy would sell for about $60,000 in North Florida. But I suspect our wages are also lower.

Not that much lower. $60,000 is barely a downpayment here.

[Betis70]

Hmm, what is wrong with SLC? I was considering moving there given the strong Bush support in the last election in Utah.

[crv16]

569k in Bedford, NH gets you this:

3500sf, 2 acres, salaries comparable to California with no sales or income tax. All in one of the best towns in NH (heavily Republican).

[Betis70]

Yeah I'm a Swamp Yankee and the opposite of a liberal.

[LS]

Yep. In the early 1980s, I had a friend who was an urban planner in San Diego, and his wife was in an exec position at Broadway or Lazarus or some store like that. They got a house for $180,000 in SD that was a tiny, two-bedroom one bath.

For that much money, we got a three-bedroom two bath, enclosed garage (plus full basement) in OH.

[Hayzo]

I Grew up in Orinda,CA (20min outside of San Francisco), My parents bought this 1200 Sqft 2 bdrm house in 1969 for 20K. It was recently re-appraised for 950K.

Not a bad profit! Thank god for prop 13!

[The Loan Arranger]

Here's some examples of some nice houses in my area (South Mississippi on the Gulf Coast) all for less than $100,000!!
Go South, young man (or woman)

http://www.livingchoices.com/home/homedetail.aspx?hid=533734092&mid=0920&refer=NULL

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001417912

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001420126

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001376977

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001575055

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001600346

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001376981

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001348277

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001566457

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001496109


http://www.millenniummortgagemississippi.lenderhost.com

[Betis70]

What sickens me is that for the "joy" of living in a cramped studio apartment, I could be making monthly payments on a nice house with a garage, where I could work on my car--one of my hobbies that I can't do right now.

But I came here to get out of debt and that has been accomplished, so on to step 2 of the master plan--home ownership.

[Blowtorch]

I never thought I could afford to live in California, but if you can get a foothold, you can buy into the high cost of real estate in the area you live and ride it out. Timing is everything. If I ever move out of state, I will be able to trade way up in terms of a home.

[Age of Reason]

Take a look at the boro of Queens in New York City:


http://www.realtor.com/FindHome/HomeListing.asp?snum=7&frm=bymap&pgnum=1&mls=xmls&js=on&fid=so&vtsort=&ss_aywr=&poe=realtor&areaid=744&ct=Flushing&st=NY&zp=&primaryZp=&nearbyZp=&mnprice=0&mxprice=99999999&mnbed=0&mnbath=0&typ=1&mnsqft=0&exft=0&exft=issty&exft=0&exft=0&lid=Enter+MLS+ID&sid=03C43CB29727C&snumxlid=1042456468&lnksrc=00002



http://www.realtor.com/FindHome/HomeListing.asp?snum=23&frm=bymap&pgnum=3&mls=xmls&js=on&fid=so&vtsort=&ss_aywr=&poe=realtor&areaid=744&ct=Flushing&st=NY&zp=&primaryZp=&nearbyZp=&mnprice=0&mxprice=99999999&mnbed=0&mnbath=0&typ=1&mnsqft=0&exft=0&exft=issty&exft=0&exft=0&lid=Enter+MLS+ID&sid=03C43CB29727C&snumxlid=1041062451&lnksrc=00002

[Blowtorch]

See my post 110. This is exactly what I mean! Trade up - in a big way! Nice house - it'd be worth well over a million in most of CA.

[Blowtorch]

Pack up your SUV, rent a U-Haul and move here.

You sound very convincing. Maybe we could be neighbors.

[Betis70]

Your parents made out well! I have a co-worker who lives in San Carlos and bought her house in the late 70s for 80K. I think it is easily worth 800K now. She is about 5 years from retirement, so I hope the prices don't change much. And with the equity my brother has in his condo, he can buy a nice house outright someplace else (which he is also considering).

It's a lovely area, and I wouldn't mind staying here (well except for all the lefties), but I missed the window to get my foot in the door of the real estate market, so I'm off to greener pastures. *shrug* Oh well. I've lived in lots of different places, so moving is no big deal.

[The Loan Arranger]

Take a look, and try not to cry:
http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001478898

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001580673

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001392493

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001475643

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001403049

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=7000000006776560

http://homescout.homegain.com/scripts/ListRedir.dll?center=HomeScout&al_listings_lid=8000000001478874

[Betis70]

>>Timing is everything.

Absolutely. One of my friends who grew up in Los Gatos could not afford the area so he moved out near Sacto (Rocklin). 4 years later his house has appreciated about 30% because lots of other people did the same thing, only a year or two later.

[Publius6961]

This has been a problem in the San Francisco Bay area since the 60s. Nothing new here whatsoever. My first proposed purchase fell through two days before it was to be "final".
When I finally was able to buy one there was a protracted mini-depression and the glut of new homes made it possible to jump in successfully. My second home did not enter the picture for another 37 years...

[Blowtorch]

My home value has nearly doubled in only two years. It is almost unbelievable. The appreciation is more/yr than I make at my job. My wife and I could not afford the same house now.

[FightforFreedomCA]

Here's our CA story...our first house was a new townhouse in Santa Rosa, purchased in June of 2001 for 259K (3/3 - 1500sq ft). We just sold it this month for 409K. In the interim, we purchase another new towhome in the nearby town of Rohnert Park for 405K (4/2 - 1700 sq ft). They are now selling them for 470K.

We are currently looking to get into an actual house in an area we like better, but the prices are really high. Again, it's a new build and prices goes up with each successive release. The houses are big enough that we will probably purchase one with a friend. Our goal is to be in it for at least 2 years and then hopefully sell it at a nice profit and move out of state. We're considering Boise.

The prices are really nutty, but if you can get it and keep things moving, it can work to your advantage...that is, unless the bottome drops out.

The reason I don't see this happening right away is due to the reasons others have stated. They are not allowing large builds due to the environmenatal wackos and some obscure salamander in the north bay area (not kidding). There is also a very high demand and immigrants (legal and illegal) are defitely buying homes. Many times they go in as multiple families to qualify and live together to get started.

[RipSawyer]

There is a better house than that about a mile from where I live and the sign out front says,"for sale#59,900. For $569,000. I could have 200 acres in the country AND a house three times as good as that with money left over.