California has a huge problem that it can only solve by a re-adjustment in real estate. Bay area and Southern California professional jobs can not support the current housing price runup. As interest rates rise - or even stagnate - housing prices in these areas will adjust down: the areas simply do not provide employment to support the prices. As I have said numerous times ... at todays price points, to live anywhere near the coast in So. Ca. - even 20 miles inland - requires about a 300K household income for reasonable housing. Trust me .... there WILL be a price adjustment or the california economy will go in the tank. Companies can not and will not find people willing to live in the middle of the mojave desert in prefab housing and to drive 3 hour daily commutes to their jobs ......
It is true that during real estate bubbles people do leave California. During the last downturn from 1990-95 we lost many of our personal friends. They moved all different directions, Boise, Las Vegas, Phoenix, etc. It was quite stunning actually as they one by one left. They were able to get jobs paying about the same, and buy housing for less than half. Their personal situations improved, thus their quality of life. I haven't seen our friends start moving as of yet in this real estate cycle, but I believe we are just getting started. When I retire I am toying with the idea of moving to Las Vegas. I can deal with the climate, lots to do, taxes are less, etc. California is just too expensive to retire in. There are much cheaper places to live, like here...this house would be about $750k in my neighborhood. http://www.recolorado.com/Search/propertyDetail.asp?mls_number=270564# or here, this house would be probably about 900k or so (be sure to click on the little pics, quite a nice place). http://www.fsbomadison.com/details.asp?ID=8512 I just wouldn't know how to live in such a cold environment!
you're preaching to the choir. http://moneyshaker.blogspot.com/2005/10/real-estate-forecast-in-california.html http://moneyshaker.blogspot.com/2005/10/understanding-real-estate-market.html
Man...if I had to choose to buy this $hitbox or move to another part of the country....duh! Boise here I come! moo! http://www.realtor.com/FindHome/Hom...632DA214794C&snumxlid=1052963864&lnksrc=00003
Even boise has had a gigantic runup ... Ever been to boise ? There are about 4 or 5 major employers ... thats it.... its in the middle of nowhere..... Nice homes there have runup to 300K to even 400K ... in BOISE ! Boise certainly re-enforces the notion of a speculative bubble in real estate nationally - or if not nationally then certainly in the western region......
If you want great deals, try looking around the Atlanta area,towns like Kennesaw,Roswell,Alpharetta, and Cumming. http://www.realtor.com/FindHome/Hom...633CA4B8AC1C&snumxlid=1055901441&lnksrc=00001 http://www.realtor.com/FindHome/Hom...633CA4B8AC1C&snumxlid=1055260625&lnksrc=00001 http://www.realtor.com/FindHome/Hom...633CA4B8AC1C&snumxlid=1054910201&lnksrc=00001 http://www.realtor.com/FindHome/Hom...633CA4B8AC1C&snumxlid=1054133224&lnksrc=00001 http://www.realtor.com/FindHome/Hom...633CA4B8AC1C&snumxlid=1051190300&lnksrc=00001
yes i was there last summer. I'm doing several pre-construction deals in boise. returns are not bad, but then i'm still not very impressed with the fundamentals. for starters there is a terrific amount of vacant land available. this will cap the amount of appreciation since if things get too expensive people will just move further out. Also the rental market is extremely soft. You buy a new house for 230k - 4/2.5/3 about 1950 sq ft and it rents out for $900/mo after being vacant for a few months. thats really pathetic. It shows its being overbuilt. I expect prices to jump in summer but unless the rents strengthen too, prices will probably stagnate at that level.
isn't the job market taking a beating there? also whats the vacancy rate like? i know quite a few californian investors there already.
Somewhat off-topic, but those are some genuinely beautiful homes (though the 5th one has an interior pic with some truly terrible wallpaper).