[quote=AN]I dunno. I don’t see how this can last. Even with your 25 years old cousin getting a windfall of $1.2M, that still can’t get him a 1600 sq-ft house in Cupertino, which is now going for around $1.8-2M. So, if he plow all $1.2M into the house, he would still need to get a $600-800k loan for a 1600 sq-ft house. You can get a much bigger house in Carmel Valley for $800k. So, even if you get a $200k windfall in SD, you’re still in a much better situation here. Not to mention the long term property tax difference. A $1.8M house in Cupertino would have yearly property tax of ~$21k and rising 2% each year, while the $800k house in Carmel Valley would have property tax of $9500. After 30 years, the Carmel Valley house would have a property tax of ~$17k while the Cupertino house would have property tax of $38k. At $38k/year in just property tax alone, I hope people in the bay save well and aren’t counting on SS.
I don’t know how high this will go, but definitely, right now, the bay area feel like 2006 in SD. I feel sorry for they young people who haven’t bought a house up there and aren’t lucky and hit an IPO lottery. For every LinkedIn, there are thousands of engineers who aren’t so lucky.[/quote]
I don’t think there’s a disagreement on there being a correction in the future. I’m doubting the magnitude of it that some apparently are convinced will happen, just as much as I doubted the magnitude of the correction we experienced here in SD in the areas where demand is generally stronger than other places.
And that cousin doesn’t *need* to live in a 1.8million+ place in Cupertino, he can live just fine in Santa Clara. It’s a tradeoff, that people make more so there than down here.
Regardless, when this new tech bubble does pop, guess who’s going to end up eating shit the most? Yup, retail stock “investors” who either bought these company stocks directly, or are indirectly holding onto them with a mutual fund, like the famous Fidelity Contrafund or OTC fund, that is in just about everyone’s 401k plan.. It won’t be all the employees and insiders of these companies that were given these shares as part of their employment package. Just like how was back in 2000/2001.
