[quote=bearishgurl][quote=pri_dk]Lots of fairly high-priced restaurants in Temecula/Murietta are packed on weekends. It’s supposed to be one of the epicentres of the housing crisis, but you’d never know the economy took a hit if you only observed the traffic in these restaurants.
It bugs my wife because I always ponder it every time we eat out. My only theory is that it is strategic defaulters with extra cash flow because they are not paying their mortgages. But I’ve been observing this for years, and I’m still perplexed.[/quote]
pri dk, Temecula/Murietta is a lower-cost housing area. There are MANY homeowners there who DID NOT purchase their properties at high prices (they purchased pre-bubble). In addition, there are many lower-cost rentals there and even a few mobile home parks.
Not everyone has high living expenses or high property taxes. MANY people (including most Mexicans living in MX) have FAR cheaper living expenses than a “typical Pigg.” Therefore, they have more discretionary income for restaurants and entertainment.
LOTS of people eat out almost daily in lower cost-of-living regions of the US. MANY eat in the SAME 1-3 restaurants night after night.[/quote]
Actually the low cost rental part is a common misconception. A condo that you can buy for 170k will cost you 1500 and up to rent. A 1 br apartment is at or over 1k (and can be bought for 80k). When I was renting here I marveled at how high the rents were in comparison. Had I not been strategically renting and waiting to buy, I would have moved, paid maybe 20% more in rent for a propery worth at least double. Now I’m speaking of Temecula and not areas 15 miles away that many lump in. Another exmple is my model match on my street just rented for $2600, the time between tenants was about two days. The owner bought that place for about 340K, so at most levels (small, medium and large) renting seems to be equal to costlier than buying.
But to answer the riddle of why there doesn’t seem to be a slowdown locally, BG is correct on many counts, not everyone is bubble buyer and the area has churned out most of those folks years ago. This area was hit a lot earlier than most, it’s been four years since the brown lawns first started showing up, it’s August, I don’t see any brown lawns now and my tract is dead center meltdown, being built in 2006, but there even here, the half price buyers outnumber the bubble 2-1.
I say just look at the census data, household incomes on par with Carlsbad (70k+) and mortgages at less than half of almost any area in SD county. Maybe 10% are unemployed, but the other 90% have more disposable income. Just ask the piggs that live up here, many of them probably have household incomes of over 100k and total housing debt somewhere in the 200’s, maybe 300k. Life is a whole lot easier when the lion share of your pay doesn’t go to housing.
And it’s not just weekends, ask sdr, he and his crew came up a few weeks ago on a Sunday night. We went to a concert in the wine country, sold out for seats, we had to pay $60 each to stand in the back. My car was embarrassed to be parked alongside the hundreds of nice cars in the lot. Then we went to dinner, on a Sunday night, late, like 830 or 9, packed as well, and it was not an inexpensive place or a family place.
Some businesses have gone under and maybe more people are using their entertainment dollars locally instead of travelling this summer, but the theory that it is because people aren’t paying their mortgages has lost it’s legs.
An article just came out saying that it could be the local travel, that the 15 hotels are reporting a 10% increase in occupancy.
TEMECULA VALLEY Southern California Wine Country: August 8, 2011- “July saw the eleventh consecutive month of positive, local hotel industry growth,” reports Kimberly Adams, Temecula Valley Convention & Visitors Bureau president and CEO. “For the month of July, room occupancy was up 15.8% and revenues were up 19.5% versus July last year. Year-to-date through June 30, room occupancy is up 10% and revenues are up 10.4%. By comparison, California – which is the Number 1 travel destination and tourism state in the U.S. – is up 5%.”
