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Single Family Homes in Santa Clara County: March 2018 Report
- 11thEarlOfMar 9y agoSelect 'Median Price' cell for details.
- zitterbewegung 9y agoI'm beginning to wonder if you could make an incubator that also has real estate holdings where you sell and rent houses to people in Silicon Valley and also fund startups. The houses that you have on hand or want to rent you would provide for startups (basically dormitories). The houses in SV would be a hedge on the Startups that you are funding because by bringing in jobs you would also increase the housing prices.
- mamon 9y agoSo, you want to be like Erlich Bachman from "Silicon Valley" sitcom? :) Once upon a time comedy was just for fun, now, if you are screenwriter for a sitcom you have to be carefull because someone, somewhere will take your foolish ideas seriously... Honestly, we need more "Don't try this at home" warnings.
- aaronblohowiak 9y agoThere are several “hacker houses” on the peninsula already — that show is more of a documentary than many people realize
- zitterbewegung 9y agoI don't have HBO it seems like I should for some reason... I keep on having ideas that are on the show.
- andrewmcwatters 9y agoIt would probably be the other way around: an REO firm that made investments in startups.
- meritt 9y agoThis has been happening for the past decade. Why do you think so many VC/PE firms and incubators have a hard requirement of people relocating to SF/SV? You'll also find that many investors will very strongly encourage your startup to utilize technology choices (e.g. MongoDB or Docker) that happen to be part of their investment circle.
- gnicholas 9y agoYou're suggesting that an individual VC partner requires relocation because it will increase the value of his home? I doubt the effect would be strong enough, especially because the type of homes that VC partners live in ($5M-25M) are in a somewhat different market than the homes that VC-backed startup employees would purchase/rent. I would think that relocation requirements would be primarily motivated by factors related to the value of being in SV for networking and other purposes.
- meritt 9y agoTheir individual homes? Not at all. They invest in companies that build, sell, and lease single-family, multi-family, and commercial real estate in the SF/SV area.
- gnicholas 9y agoI'm not familiar with this—how common is this type of investment among VCs? I assume not all VCs have investments in this area, and it would be interesting to see whether the firms that do invest in this area correlate with the firms that require relocation.
- adventured 9y agoThat prompted me to recall Carl Berg from the prior era of the 1980s and 1990s tech boom. He ended up with a lot of stray equity holdings as a consequence of his real-estate position in Silicon Valley. https://www.forbes.com/forbes/1998/1012/6208086a.html https://www.forbes.com/forbes/1998/1012/6208086a.html
- noobhacker 9y agoMaybe I'm using the wrong terminology, but isn't a "hedge" something you do to reduce the risk / variance of your investment? If the start-up scene tanked, both your house and your incubator would do less well. Therefore, both markets are correlated and do the opposite of reducing risk.
- beamatronic 9y agoThis exists but is not publically flaunted/advertised.
- DrScump 9y ago... because it's illegal to flout fair-housing regulations.
- callalex 9y agoThis idea sounds dangerously close to a company town, which is fairly universally regarded as a terrible idea. https://en.m.wikipedia.org/wiki/Company_town https://en.m.wikipedia.org/wiki/Company_town
- maxerickson 9y agoHousing subsidies and allowances are pretty common though.
- usaar333 9y agoWhat I find amazing though is that rents have been flat for the last 2 years. https://www.zillow.com/santa-clara-county-ca/home-values/ https://www.zillow.com/santa-clara-county-ca/home-values/ And prices (relative to rents) have increased even more (>35% actually) if you factor in tax code changes making home-owning comparatively more expensive. Irrational market?
- SatvikBeri 9y agoI think it's mostly that the relative value of future money to current money went up, due to cheap money and lack of investment opportunities. One piece of evidence for this is increase in earnings-per-share multiples paid for stocks in the S&P 500: http://www.multpl.com/ http://www.multpl.com/
- usaar333 9y agoBut the counter-evidence is that real estate investment trusts are generally flat over the last 2+ years (and that S&P valuation increases can be mostly credited to belief in a business friendly political environment). What makes Santa Clara real estate defy that trend?
- conanbatt 9y agoRents might have hit a limit with the lower half of incomes of the area. I've read some articles that mention that california is losing a lot of people.
- seanmcdirmid 9y agoPeople are always leaving California, yet every year it gains in total population. As Yogi Berra said, "Nobody goes there anymore. It’s too crowded."
- jessaustin 9y ago"Bay Area is top region for outward migration in the U.S." https://www.sfgate.com/expensive-san-francisco/article/Bay-Area-outward-migration-exodus-sf-redfin-12563337.php https://www.sfgate.com/expensive-san-francisco/article/Bay-A...
- dfee 9y agoWhere would I find this for other US cities?
- mturmon 9y agoStart at https://www.zillow.com/los-angeles-ca/home-values/ https://www.zillow.com/los-angeles-ca/home-values/ and use various zip code queries at the top bar. The year-by-year plot is at the bottom.
- dfee 9y agoThe analysis in the original link has much more data than a Zillow search. I’ve actually never seen a realtor report with that much information.
- teuobk 9y agoI'm not sure about a general source, but there's a real estate agency in Summit County, Colorado that puts out similarly detailed reports for that area: https://www.breckenridgeassociates.com/statistics.php https://www.breckenridgeassociates.com/statistics.php Their reports show data going back to about 2000. It's interesting to see the rise and fall of inventory levels, days-on-market, price per square foot, etc., as the economy has gone up and down. They also break it down by housing type, so you can, for example, see the changes in condo stats separately from single-family home stats.
- hardtke 9y agoThe odd thing about the current market, compared to the previous periods of rapid appreciation in the Bay Area, is that few of the current owners seem to be cashing out and leaving. This is causing the inventory issues.
- matt_wulfeck 9y agoProp 13 makes it really expensive to upgrade, so there’s also less mobility from the “modest” range of homes (approximate $1m range imho).
- SeeDave 9y agoFrom my understanding, it's not even a matter of upgrading. Two neighbors with exactly identical homes, who have lived in the same city for 20 years, wouldn't be able to sell their houses to one another (for a net gain of $0 each) without triggering a massive tax increase for both parties.
- matt_wulfeck 9y agoYes that is correct. They also can’t build their home out and increase the square footage to better accommodate their families without triggering a tax appraisal. In a word their stuck, which helps explain again why there’s very little mobility.
- whb07 9y agoTheres a common real estate move where you can defer your taxes on a real estate sale if you use the proceeds to buy a similar amount of property (dollar amount) [0]. So as long as the proceeds from the sale go into a similar type of property/business then you can defer taxes for a future date. [0]:https://www.irs.gov/newsroom/like-kind-exchanges-under-irc-code-section-1031 https://www.irs.gov/newsroom/like-kind-exchanges-under-irc-c...
- matt_wulfeck 9y agoThe problem we’re describing is that their property taxes would increase sinificanty, thousands of dollars a month.
- artwr 9y agoIt's not exactly year over year, it's compared to December 2017 which was the previous high for median prices.
- artwr 9y agoNevermind, turns out I can't read straight.
- ataturk 9y agoAnyone buying into that hellstorm is just the next greater fool.
- matt_wulfeck 9y agoI was sure the market was going to crash when we bought our home, but external and internal forces made us stop waiting and make the leap. At this point a large correction in the market wouldn’t even put us below our purchase price.
- speg 9y agoSo when do you cash out and move to the Midwest?
- deleted 9y ago[deleted]
- dsfyu404ed 9y agoWell the preference of the Midwest would be never. A rapid influx of rich people is never good the people who were there first. Edit: and that's not even taking into account the incompatibilities between Midwest society and SV society.
- jandrese 9y agoWhen they retire? People aren't moving to the Bay Area because they just love sitting in traffic and overpaying for everything. It's where the jobs are. Also, the schools are full of engineer kids.
- biesnecker 9y agoSo sales are up, and inventory is up, but days on the market is down sharply. It seems reasonable that if houses are going faster then higher bids are being made because you're not going to get a second chance. Totally unrealistic, and somewhat antithetical to the whole idea of free markets charging what consumers will bear, but this is where Vickrey auctions would be amazing: https://en.wikipedia.org/wiki/Vickrey_auction https://en.wikipedia.org/wiki/Vickrey_auction
- thiagoperes 9y agoThis is how it's done in the Netherlands, actually.
- jackcarter 9y agoInteresting! I have a question about how it works in practice: In the US, there are often extra considerations beyond the offer price. For example, someone paying in cash can typically offer less than someone who needs a mortgage, due to the lower risk of the offer falling through. Or I might bid less, but require that an aging roof be replaced at the current owners' expense. How do they deal with that in the Netherlands?
- himlion 9y agoI've never encountered it, and I'm a homeowner in the Netherlands. The sealed bid auctions I've seen were all regular ones were if you are the highest bid you have to pay that price.
- EmielMols 9y agoThis is factually incorrect. There are rules regarding the bidding process for buying a property in the Netherlands (Amsterdam model, Haarlem model or closed bidding with deadline), but none of them include a part where the second highest price is used.
- adtac 9y agoReally interesting concept. What's stopping me from bidding an absurdly high amount, knowing that I'll win and only pay as much as the second highest bid? I guess I'll have to be the only one trying to do this for this to work?
- NotSammyHagar 9y agoAs someone from Seattle, I can only say this makes me unhappy, because even more people will want to move from SF to here. We have enough people here, please consider moving to another fair city. :-) Our own media brags about how we are the fastest rising city by price, yet quotes numbers smaller than this, say 19% yoy as of January - http://seattlebubble.com/blog/ http://seattlebubble.com/blog/.
- CabSauce 9y agoIt's always interesting to me that a progressive city, like Seattle, has a bunch of people who proudly push a protectionist/exclusion stance similar to the anti-immigration stance on the far right.
- djrogers 9y ago> similar to the anti-immigration stance on the far right I'm not on the far right, but I can tell you that of those I know who are, precisely none of them are 'anti-immigrant'. The majority of them would like to reduce illegal immigration and improve border security, but that's also true of the vast majority of Americans as a whole. Perhaps when you say 'immigrant' you are actually referring to illegal immigrants? Even in that case, over 3/4ths of Republicans favor a pathway to citizenship for existing illegal immigrants (including 'dreamers'). [1] Previous Gallup research has shown that 77% of Americans say that "controlling U.S. borders to halt the flow of illegal immigrants into the U.S." is extremely or very important. And 83% favor "tightening security at U.S. borders." http://news.gallup.com/opinion/polling-matters/209384/building-wall-sync-american-public-opinion.aspx?g_source=link_newsv9&g_campaign=item_225200&g_medium=copy http://news.gallup.com/opinion/polling-matters/209384/buildi... [2] http://news.gallup.com/poll/193817/republicans-favor-path-citizenship-wall.aspx?g_source=link_newsv9&g_campaign=item_225200&g_medium=copy http://news.gallup.com/poll/193817/republicans-favor-path-ci...
- CabSauce 9y agoYou're using surveys of all republicans and all Americans to dispute my comment about 'the far right'?
- dalbasal 9y agoI would like to see total mortgage debt and price side-by-side. *I mean that, anyone know where to get this?
- kaycebasques 9y agoOutstanding mortgage debt on 1 to 4 family residences: https://fred.stlouisfed.org/series/MDOTP1T4FR https://fred.stlouisfed.org/series/MDOTP1T4FR
- la6470 9y agoI like Silicon Valley because it is full of people from other parts of the world ie very cosmopolition. That’s why property prices are high too.
- whowouldathunk 9y agoAbout the same here in Seattle. It makes saving for a down payment even more depressing. I don't understand who is able to buy these houses when my partner and I can't as software engineer + physician assistant. Maybe it's just because we're not willing to decrease or dip into our retirement savings and we have no help from parents. I just don't feel comfortable taking out a jumbo mortgage. Even though we could make the numbers work, I'm not confident either of us won't burn out from our stressful careers.
- finaliteration 9y agoI live in Portland but I’m in the same boat you are. My wife and I make a decent amount of money ($120k+) but a combination of student debt, crazy housing prices, and lack of wealthy family members who can “gift” a down payment leaves me fairly hopeless that we’ll ever be able to buy a house of our own. We’ve seriously considered moving to the Midwest or the South where houses are affordable, but neither of our jobs allow fully remote work, very few cities in those areas have any sort of tech presence, and we’d be leaving pretty much every family member across the country.
- tjr225 9y agoI live in the area as well and I think the reality is that Seattle is going through a massive change due to densification. Nobody expects to be able to buy a single family house in NYC- and that will probably soon be the case for cities like Seattle and SF...however this is a relatively recent development for us and therefor a much harder pill to swallow. I came from the midwest (born and raised) - to respond to the other commenter...home ownership is cool, but I like it out here a lot more. Also, I make WAY more money here. Like 50% more, and I'm at the bottom of the engineer food chain. I make more money than any of my more experienced senior engineer friends back in the midwest. The amount of outdoorsy opportunities, interesting companies to work for, and boom/bust culture is just too exciting. Midwestern cities also experience a lot more violent crime (check out any top 10 list of dangerous cities). I think I heard gunshots almost every night that I lived in Kansas City, MO.
- JBlue42 9y agoSomeone posted this the other day and everything it said hit home: http://highline.huffingtonpost.com/articles/en/poor-millennials/ http://highline.huffingtonpost.com/articles/en/poor-millenni... Relevant pieces: >Despite the acres of news pages dedicated to the narrative that millennials refuse to grow up, there are twice as many young people like Tyrone—living on their own and earning less than $30,000 per year—as there are millennials living with their parents. The crisis of our generation cannot be separated from the crisis of affordable housing. >More people are renting homes than at any time since the late 1960s. But in the 40 years leading up to the recession, rents increased at more than twice the rate of incomes. Between 2001 and 2014, the number of “severely burdened” renters—households spending over half their incomes on rent—grew by more than 50 percent. Rather unsurprisingly, as housing prices have exploded, the number of 30- to 34-year-olds who own homes has plummeted. >Falling homeownership rates, on their own, aren’t necessarily a catastrophe. But our country has contrived an entire “Game of Life” sequence that hinges on being able to buy a home. You rent for a while to save up for a down payment, then you buy a starter home with your partner, then you move into a larger place and raise a family. Once you pay off the mortgage, your house is either an asset to sell or a cheap place to live in retirement. Fin. >This worked well when rents were low enough to save and homes were cheap enough to buy. ... >Since the Great Recession, the “good” jobs—secure, non-temp, decent salary—have concentrated in cities like never before. America’s 100 largest metros have added 6 million jobs since the downturn. Rural areas, meanwhile, still have fewer jobs than they did in 2007. For young people trying to find work, moving to a major city is not an indulgence. It is a virtual necessity. >But the soaring rents in big cities are now canceling out the higher wages. Back in 1970, according to a Harvard study, an unskilled worker who moved from a low-income state to a high-income state kept 79 percent of his increased wages after he paid for housing. A worker who made the same move in 2010 kept just 36 percent. For the first time in U.S. history, says Daniel Shoag, one of the study’s co-authors, it no longer makes sense for an unskilled worker in Utah to head for New York in the hope of building a better life. >This leaves young people, especially those without a college degree, with an impossible choice. They can move to a city where there are good jobs but insane rents. Or they can move somewhere with low rents but few jobs that pay above the minimum wage. >This dilemma is feeding the inequality-generating woodchipper the U.S. economy has become. Rather than offering Americans a way to build wealth, cities are becoming concentrations of people who already have it. In the country’s 10 largest metros, residents earning more than $150,000 per year now outnumber those earning less than $30,000 per year.
- aresant 9y agoDoes anybody have an economist that they like who is writing intelligently about housing pricing right now? You see 27% in SV, and almost 20% in subs like Oakland and it's hard not to remember the couple of years leading up to the 2007 crash when word on the street was "buy now or you will never be able to afford" I bought on that advice and took a 35% haircut in a good market a few years later.
- ebikelaw 9y agoThe idea that housing always goes up in price is nonsense so you’d be right to be skeptical of “get in now” urges. If anybody said that about stocks they’d go to jail but for some reason we don’t regulate marketing if housing-as-security the way we regulate actual securities. The only reason housing prices are skyrocketing is because we’ve built a protective legal regime around incumbent land owners. The market can’t function so the price goes up. Just as an example I’d be very pleased to build a small stack of flats on my Oakland property, say four units, but the law doesn’t permit that. On my block there’s a 1938 building with 22 apartments on the same sized lot as mine. So we used to allow it, and clearly it’s within the character of the neighborhood, to borrow a phrase from the NIMBYs, but we’ve just outlawed that kind of building. As soon as the regulatory environment gets fixed, supply is going to explode and prices will fall.
- usaar333 9y agoBut a lack of supply doesn't explain rents being comparatively flat over the past 2 years. The prices going up imply either: 1. Market has strong belief that housing construction will stop in the future (i..e regulatory environment actually worsens), leading to surge in rents. 2. Irrationality.
- conanbatt 9y agoThere are many reasons why rental and house price can diverge. More people living in the same space, a change in demographics, marginal tax rates. Markets have an irrational component, but seemingly irrational behavior is more often misunderstood rational behavior than the other way around.
- subroutine 9y agoThere must be a study out there demonstrating that people systematically undervalue (or outright neglect) cost-of-living in a region when taking a job offer. One of my friends graduated from my phd prog (uc san diego) a few months ago and immediately took a job offer in SF. He said it was his best offer by more than $20k/yr. Every time I've spoken with him since, he complains about how expensive it is to live there and how much he pays for rent for an apartment in Berkeley area. Though when I ask if he is considering looking for a job elsewhere soon, he just says nah, the money is too good to leave. The thing is, even knowing this, I can totally see myself in an interview soon, somewhere in the valley, and getting an offer that makes me go 'well shit, how could i not afford a nice apartment on that salary'. How bad is it guys? Could someone making $140k/yr ever expect to be a homeowner in SF/SV?
- monkeynotes 9y agoIf you are being paid $20k a year more than elsewhere, after tax perhaps that equates to ~12-16k a year. You'd therefore be able to afford between 1-1.5k a month more in expenses than earning the comparable salary offered elsewhere. I'd suggest that in SF that you maybe, just maybe break even (renting that is), but more than likely you are worse off financially. However, SF will more than likely be a better place for career growth and opportunity. You shouldn't undervalue that, especially at the beginning of your career. As far as buying a house goes, depends on what kind of commute you can tolerate and how much downpayment you have. I think you'd struggle to be comfortable on anything less than $200k.
- Retric 9y agoEven if your after tax cash flow is similar Social Security befits from higher salaries. Another consideration is there are larger benefits to downgrading your lifestyle. Living in a Tiny studio apartment in SF or even having roommates frees up a lot more cash than it does in most places. Going without a car in NYC is a minimal sacrifice for significant rewards.
- deleted 9y ago[deleted]
- RomanPushkin 9y agoWe should build higher and increase the density of housing. Building dense housing will also help end the housing shortage that raises rents and makes people homeless. One of the roots of the housing shortage is in the zoning laws that limit how much housing can be built on a plot of land. We can't make housing inexpensive while keeping it low density.
- kindatrue 9y agoYou'll understand why this is once you watch this 36 second video clip of a guy shouting he will devote his life to stopping 900 homes from being built where an abandoned K-Mart and Circuit City now lay - and how he will succeed just like he's done in the past. https://twitter.com/cafedujord/status/971633159669338113 https://twitter.com/cafedujord/status/971633159669338113
- pfarnsworth 9y agoYou can’t just add homes and not worry about traffic. That only exacerbates commute issues which is one of the reasons why houses so far away from business centers get so expensive, because houses even further have exponentially worse commutes. Public transportation needs to be fixed first so that people from east bay and beyond can get to the Silicon Valley and SF faster. If I could live in Tracy and get to SF in 30 mins or even 45 mins, I would move there in a heartbeat. But it takes 1.5-2hrs even with BART. That will do more to lower house prices than cramming a small number of houses or condos in an already crowded area.
- ebikelaw 9y agoPaving over San Joaquin County with detached single family homes on quarter-acre lots will never fix our housing problems and certainly runs against our climate change goals. We have to build walkable neighborhoods a sensible distance from job centers, along existing transit corridors.
- pfarnsworth 9y agolol With all these disparate opinions, the problem will never be solved. People are going to have to agree on a sub-optimal but better plan otherwise the status quo will continue to win. Keep in mind that the NIMBY powers that be are a lot stronger, and as the house prices go up, every new home owner becomes more and more disinclined to support new housing in the SF Bay Area. The ONLY chance for lower house prices is better, more efficient public transportation and moving people further away from their jobs.
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- coffeeacc 9y agoWhat is a multiple family home?
- fightorflight 9y agoAnother good website to understand the bay area housing situation is Juliana lee's website (https://julianalee.com/ https://julianalee.com/). I regularly visited her site to understand pricing trends in different zip codes and cities. For the record, I did not use her services.
- jakobegger 9y agoIn the comments here I read a lot about tech workers struggling with the cost of living. If it’s hard to make it work for someone with a 100k salary, I can’t imagine what it must be like for people with “normal” salaries. What about bus drivers and waiters and salespeople in stores? How do they make it work? I’m genuinely curious, I have no idea what living in the bay area is like.