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>We’re in a bubble that’s ready to burst IMO Why do you think that, though? Is it solely because prices are rising very quickly? There's no indication whatsoev

>We’re in a bubble that’s ready to burst IMO Why do you think that, though? Is it solely because prices are rising very quickly? There's no indication whatsoever that people will stop buying any time soon. Homes are selling >110% of asking price for all cash within days, and supply is essentially fixed.

refurb 9y ago
People were saying the exact same thing before the crash in 2007. Not saying a crash is imminent, but prices are even higher than before last crash, even taking inflation into account.
- aphextron 9y ago
  >People were saying the exact same thing before the crash in 2007. People were buying overvalued homes they couldn't afford in the middle of nowhere on subprime adjustable mortgages, which caused the crash of '07 when the ARM rates kicked in and they couldn't afford payments. This is a fundamentally different situation. Now, a very small number of elite highly wealthy people from around the world are treating American housing stock as their investment vehicles since there is literally no other better option in 2018. Where we go from here in terms of affordable housing, nobody knows. But I really really doubt we're going to see a housing crash any time soon. It's just simple supply and demand.
  - tehlike 9y ago
    I dont have much knowledge, but i hear asian buyers investing looked similar to japan investing in 80s.
    - halbritt 9y ago
      In the period after the downturn and just before the market started to tick up in mid 2012, there were a number of Asian investors buying up large swaths of foreclosed and distressed homes in Oakland for cash. I recall this specifically, as I was in the market for a house at the time. Fortunately, I didn't face much cash competition as I was shopping slightly upmarket. The line seemed to be $300-400k. Those folks would be seeing pretty good returns at this point as those houses are now typically worth $500-600k and might be renting for $2-3k.
  - refurb 9y ago
    Do you have a source for foreigners "treating American housing stock as their investment vehicles" and that driving up prices? That was the complaint in Vancouver until they actually started tracking foreigner purchases and it turned out it was 10-15% of purchases (higher in certain neighborhoods). That means the other 85-90% of demand was from Canadians.
ninkendo 9y ago
I believe the pricing growth is fueled by tech wage growth which is unsustainable. I also think the tech sector in general (especially any company that is driven by ads) is due for a major correction soon, if not a full burst. I can’t tell you exactly why I feel it, it’s more an emotional thing, but I don’t see a better strategy than that when trying to predict long-term housing prices.
- htormey 9y ago
  “I also think the tech sector in general (especially any company that is driven by ads) is due for a major correction soon, if not a full burst.” Why do you say that? Haven’t all the tech companies been performing well across a variety of metrics these last few years?
  - sokoloff 9y ago
    Ad money ultimately flows from consumer (mostly) discretionary demand. If we were to see a significant pullback in consumer discretionary spending, you’d see a lagging pullback in ad spending.
- rubicon33 9y ago
  I believe tech salaries will decline starting in about 5 years, and accelerating in 10 years. Why? HUGE influx of people into the field, fueled by government programs, people in tech pushing for more people to join (why they would ever do this is beyond me, say goodbye to your salary), education in high school and younger, wide availability to learn online, outsourcing, etc... The influx of workers will simply outstrip demand once worker influx hits it's powerband in 5-10 years. Programming is on the same path that many craft careers have been on in years past. Mark my words - it's a blue collar job in the making. If you aren't specializing in some niche field of programming right now, you will be kicking yourself in 10 years.
  - MrL567 9y ago
    https://blog.codinghorror.com/why-cant-programmers-program/ https://blog.codinghorror.com/why-cant-programmers-program/ Considering articles like this and the fact FizzBuzz tests are even a thing I wouldn't be so sure. I get your point, but the problem is while with enough time one can get it, quite a few people are going to hit a wall and not be able to pass it.
ttul 9y ago
What is the price to rent ratio?
- tehlike 9y ago
  Cap rates are hovering around 2% Hong kong is worse, i hear.
  - sidlls 9y ago
    2% in SJ? That's insane. I'm paying 0.35% of the average sale price in rent for a townhouse in my community (San Mateo/Burlingame area).
    - ericd 9y ago
      Both are insane, when you consider property tax and maintenance, unless you assume a continued upward march in valuations.
      - tehlike 9y ago
        That is exactly why cap rates are squeezing.
    - tehlike 9y ago
      Looks like my data was old :)
    - klipt 9y ago
      Is that per month or per year?
      - sidlls 9y ago
        Per month. I generally charge my tenants (outside the Area) pretty close to 1% per month, for reference. If I can't get 0.9% per month or more, the property isn't worth the effort at renting it out.

refurb 9y ago

People were saying the exact same thing before the crash in 2007. Not saying a crash is imminent, but prices are even higher than before last crash, even taking inflation into account.

aphextron 9y ago
>People were saying the exact same thing before the crash in 2007. People were buying overvalued homes they couldn't afford in the middle of nowhere on subprime adjustable mortgages, which caused the crash of '07 when the ARM rates kicked in and they couldn't afford payments. This is a fundamentally different situation. Now, a very small number of elite highly wealthy people from around the world are treating American housing stock as their investment vehicles since there is literally no other better option in 2018. Where we go from here in terms of affordable housing, nobody knows. But I really really doubt we're going to see a housing crash any time soon. It's just simple supply and demand.
- tehlike 9y ago
  I dont have much knowledge, but i hear asian buyers investing looked similar to japan investing in 80s.
  - halbritt 9y ago
    In the period after the downturn and just before the market started to tick up in mid 2012, there were a number of Asian investors buying up large swaths of foreclosed and distressed homes in Oakland for cash. I recall this specifically, as I was in the market for a house at the time. Fortunately, I didn't face much cash competition as I was shopping slightly upmarket. The line seemed to be $300-400k. Those folks would be seeing pretty good returns at this point as those houses are now typically worth $500-600k and might be renting for $2-3k.
- refurb 9y ago
  Do you have a source for foreigners "treating American housing stock as their investment vehicles" and that driving up prices? That was the complaint in Vancouver until they actually started tracking foreigner purchases and it turned out it was 10-15% of purchases (higher in certain neighborhoods). That means the other 85-90% of demand was from Canadians.

ninkendo 9y ago

I believe the pricing growth is fueled by tech wage growth which is unsustainable. I also think the tech sector in general (especially any company that is driven by ads) is due for a major correction soon, if not a full burst. I can’t tell you exactly why I feel it, it’s more an emotional thing, but I don’t see a better strategy than that when trying to predict long-term housing prices.

htormey 9y ago
“I also think the tech sector in general (especially any company that is driven by ads) is due for a major correction soon, if not a full burst.” Why do you say that? Haven’t all the tech companies been performing well across a variety of metrics these last few years?
- sokoloff 9y ago
  Ad money ultimately flows from consumer (mostly) discretionary demand. If we were to see a significant pullback in consumer discretionary spending, you’d see a lagging pullback in ad spending.
rubicon33 9y ago
I believe tech salaries will decline starting in about 5 years, and accelerating in 10 years. Why? HUGE influx of people into the field, fueled by government programs, people in tech pushing for more people to join (why they would ever do this is beyond me, say goodbye to your salary), education in high school and younger, wide availability to learn online, outsourcing, etc... The influx of workers will simply outstrip demand once worker influx hits it's powerband in 5-10 years. Programming is on the same path that many craft careers have been on in years past. Mark my words - it's a blue collar job in the making. If you aren't specializing in some niche field of programming right now, you will be kicking yourself in 10 years.
- MrL567 9y ago
  https://blog.codinghorror.com/why-cant-programmers-program/ https://blog.codinghorror.com/why-cant-programmers-program/ Considering articles like this and the fact FizzBuzz tests are even a thing I wouldn't be so sure. I get your point, but the problem is while with enough time one can get it, quite a few people are going to hit a wall and not be able to pass it.

ttul 9y ago

What is the price to rent ratio?

tehlike 9y ago
Cap rates are hovering around 2% Hong kong is worse, i hear.
- sidlls 9y ago
  2% in SJ? That's insane. I'm paying 0.35% of the average sale price in rent for a townhouse in my community (San Mateo/Burlingame area).
  - ericd 9y ago
    Both are insane, when you consider property tax and maintenance, unless you assume a continued upward march in valuations.
    - tehlike 9y ago
      That is exactly why cap rates are squeezing.
  - tehlike 9y ago
    Looks like my data was old :)
  - klipt 9y ago
    Is that per month or per year?
    - sidlls 9y ago
      Per month. I generally charge my tenants (outside the Area) pretty close to 1% per month, for reference. If I can't get 0.9% per month or more, the property isn't worth the effort at renting it out.