4 ms·

Since the chance that a major earthquake will occur within the next -1000 years is about 100%, I wouldn't invest a dime in long term real estate in SF...

hkmurakami 9y ago
If you own the land underneath the building, and you're on non-land fill land, then maybe it's okay. Buying a unit in a highrise in SF never really made sense to me.
gjjrfcbugxbhf 9y ago
It is not guaranteed that the earthquake will destroy your investment. What is fairly likely is that the-greater-fool will apply. Some people won't discount the risk properly and you are therefore bidding against people who overvalue the asset.
raverbashing 9y ago
Japan would like a word
- wallace_f 9y ago
  I'm not sure what Japan would say. 2011 Tohoku earthquake was pretty disastorous. If that type of earthquake hit SF or Tokyo, I don't really know how much earthquake-proofing will matter? Stuff like this seems pretty scary for big buildings: https://commons.m.wikimedia.org/wiki/File:Liquefaction_at_Niigata.JPG#mw-jump-to-license https://commons.m.wikimedia.org/wiki/File:Liquefaction_at_Ni...
  - asteli 9y ago
    Not sure why you chose to illustrate this with a photo from over 50 years ago. I'd like to think that our understanding of earthquake safety has evolved since the 40s? 50s? whenever those structures were built.
    - wallace_f 9y ago
      I actually didn't assert anything here. It would be interesting if someone with expertise was able to offer better insight. Like the above picture illustrates, I don't know if at some point it matters anymore how well the building or foundation is built if the ground is liquified, or moves too much.
jdavis703 9y ago
I'd be more concerned about buying "soft story" (what non-civil engineers call "top heavy") real estate. But modern high density housing is engineered to withstand earthquakes. For example one of the tallest residential buildings in SF, 1 Rincon Hill, was engineered either all kinds of weight balancing measures and reinforcements. So long story short, I'd never buy "soft story" real estate, but the newer or retrofitted stuff should be fine.
EliRivers 9y ago
Is the value of the real estate principally the value of the building on it, or the right to have that building there? In large parts of the UK, the cost of real estate is a fraction of the replacement cost of the building, so even if the building was leveled in an earthquake, the only way the speculator would lose out would be if the earthquake did so much damage that the city was abandoned and the population dropped enormously. It's not uncommon with really expensive houses for a new owner to have it demolished so he can build the house he wants instead; the value is in having permission to have a house on that land, and an earthquake won't take that away (unless it's a really huge earthquake that outright destroys land or makes everyone leave forever).

hkmurakami 9y ago

If you own the land underneath the building, and you're on non-land fill land, then maybe it's okay. Buying a unit in a highrise in SF never really made sense to me.

gjjrfcbugxbhf 9y ago

It is not guaranteed that the earthquake will destroy your investment. What is fairly likely is that the-greater-fool will apply. Some people won't discount the risk properly and you are therefore bidding against people who overvalue the asset.

raverbashing 9y ago

Japan would like a word

wallace_f 9y ago
I'm not sure what Japan would say. 2011 Tohoku earthquake was pretty disastorous. If that type of earthquake hit SF or Tokyo, I don't really know how much earthquake-proofing will matter? Stuff like this seems pretty scary for big buildings: https://commons.m.wikimedia.org/wiki/File:Liquefaction_at_Niigata.JPG#mw-jump-to-license https://commons.m.wikimedia.org/wiki/File:Liquefaction_at_Ni...
- asteli 9y ago
  Not sure why you chose to illustrate this with a photo from over 50 years ago. I'd like to think that our understanding of earthquake safety has evolved since the 40s? 50s? whenever those structures were built.
  - wallace_f 9y ago
    I actually didn't assert anything here. It would be interesting if someone with expertise was able to offer better insight. Like the above picture illustrates, I don't know if at some point it matters anymore how well the building or foundation is built if the ground is liquified, or moves too much.

jdavis703 9y ago

I'd be more concerned about buying "soft story" (what non-civil engineers call "top heavy") real estate. But modern high density housing is engineered to withstand earthquakes. For example one of the tallest residential buildings in SF, 1 Rincon Hill, was engineered either all kinds of weight balancing measures and reinforcements. So long story short, I'd never buy "soft story" real estate, but the newer or retrofitted stuff should be fine.

EliRivers 9y ago

Is the value of the real estate principally the value of the building on it, or the right to have that building there? In large parts of the UK, the cost of real estate is a fraction of the replacement cost of the building, so even if the building was leveled in an earthquake, the only way the speculator would lose out would be if the earthquake did so much damage that the city was abandoned and the population dropped enormously. It's not uncommon with really expensive houses for a new owner to have it demolished so he can build the house he wants instead; the value is in having permission to have a house on that land, and an earthquake won't take that away (unless it's a really huge earthquake that outright destroys land or makes everyone leave forever).