[quote=bearishgurl]
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Well, 1.1-1.3 is around 12% of one’s net worth if one’s net worth is 8 figures at least. So I don’t see relatively speaking why this would be such a big issue, considering many others, that would be roughly 25-30% of one’s net worth and for them they still consider that affordable. Just saying 🙂
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flu, do you know if there is a high percentage of homeowners worth 8 figures ($10M or more) residing in tract subdivisions in Carmel Valley? If you know any, do you know why they chose Carmel Valley (when they could obviously afford to buy in CA’s finest well-established communities)?
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That wasn’t the point of what I said. I’m sure it will go over most people’s head. But some might get it…Figuring out is left as an exercise for the reader
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And what would you approximate to be the percentage of homebuyers in Carmel Valley who pay ALL CASH for their purchases in tract subdivisions there?
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Don’t know, but enough from what I’ve seen.
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Because Carmel Valley is the closest community to most of the well-paying tech jobs in SD, I was under the impression that the “worker-bee” homeowner is the prevalent type there (Carmel Valley subdivisions attract primarily the “worker bee” buyer.) Because of this, I never really considered it as a “high-equity” area (area with a high % of paid-off homes), but assumed the majority of homeowners there are saddled with huge mortgages.
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CarmelValley ranges from slum homes like mine to 4.5million+ homes, and everything in between.
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I mean, how many “worker bees” 20 – 45 years old have the funds to pay all-cash for an $850K ++ property? Especially those with families to support.
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Plenty, the ones that financially can do it and or make decisions in their lifestyle to be able to afford it, whether as a single income household or as a dual income household. Lawyers, doctors, businessmen/women, enginerds, etc. No different from anywhere else like Encinitas… I think one of my neighbors are a generation Y couple that owns a tattoo shop… So I don’t know what the demographics are for people that have high or low equity. I’m sure with stringent loan standards these days and with super-jumbo loans still tight, I would assume it’s still pretty difficult to qualify for a loan and so most people that are buying at prices these days still have the financial means too.
No different from Poway, which is also expensive, or Scripps Ranch, which is also expensive, 4S which is also expensive, Del Sur, and every other expensive North County area.
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Most of the demographic which typically DOES have the cash (boomers and older) are “retired” or about to retire and thus don’t have to commute anymore so they can live anywhere they damn well please (with no regard to commute times). If the older set sells their longtime homes elsewhere in SD County and CA, a newish econobox on a 6K sf lot in a very dense area is probably the last thing this group would want to drop a cool $1M on, IMO.
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You would be wrong. There are plenty of boomers that lost their Carmel Valley home after HELOCing it to death. My neighbor was one. Thank goodness. I hated them.
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I realize that there are many very wealthy Gen X and Y “worker bees” in Silicon Valley who might pay all cash for a “million-dollar home” on the peninsula. But a million-plus won’t buy much more than a 1200 – 1600 sf, 60 – 85 year-old ranch home there … a far cry from a SD econobox pretending to be “pretentious,” lol.
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Maybe there are some people can actually afford homes here, even at current prices. That said, I don’t know why you have an ax to grind with the (un)affordability and prices in parts of SD. Maybe people actually want to live in some of the lizard land places, and maybe some people dont’ mind paying more and even can stretch to afford it. And looking at it, you and many others were just plain wrong about expecting a 40-50+% correction around here. It never happened, to your disappointment. Maybe 20-25% at worst, but it’s close to peak and in many cases above peak. Anyone that held out all this time did just fine, and in some cases even better once they refi’d. Not that I’m particularly happy about it because it’s just one more dis-incentive to move to a bigger place…
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Even though Gen X and Y tech workers in SD don’t make as much money (on avg) as SV workers do, their housing expectations are through the roof (after approaching or exceeding $100K annual salaries)!
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Again, you would be wrong. There are plenty of Gen X and Y doing just fine. The buyer of the neighbor’s home is a single Gen X that I think paid close to cash for it. Biz owner.. I’m not sure why she wanted to live here, since she’s single, no kids, and I don’t even think has a boyfriend/girlfriend. But when I did ask her why she moved her, she said she liked the convenience and it was a short commute to her office. Whatever floats her boat. And no BrianSD and spdrun, you can’t have her contact info.
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SV workers are “trained” to accept what housing is available there for the price it is commanding or commute such long distances to work and back that their lives very quickly become intolerable. They have no other choice.[/quote]
Again you would be wrong. Let’s put this in perspective.
An equivalent job for someone in Bay Area would probably be 20-25% in total comp than here. An equivalent home in Mira Mesa for about $600k would run about 1.2-1.3 million for an equivalent home in Santa Clara County right now. That’s why most people in there still rent.
Fact is a dual income family enginerd family that earns close to $285k-$300k/year at least won’t really have a problem with 20-30% down on a $1million home at 4% 30 years. That’s about $4000/month which is roughly what rental prices in Carmel Valley is going for these days (exclude prop tax, MR, insurance,etc). And plenty of people do that too. They might have to make lifestyle adjustments, and spend less on other things, and it might be a personal decision whether one wants to or not. I’m guessing that most of the dual income families that can manage to purchase a $1million home probably aren’t just putting down 20% either. That’s with a household of two enginerds. I’m sure there are folks that are wealthier that can do this on a single income, since last time I checked, enginerds weren’t exactly “wealthy” people by themselves.
