California dreaming… or hallucinating?

[eikoph]

On Piggington’s it seems to be accepted as a matter of faith that one has a better quality of life living in Southern California (“everybody wants to live here”) and that that justifies a substantial premium that is reflected in house prices. I would like to present an outsider’s perspective. I now reside in Arlington, Texas (in the middle of the Dallas/Fort Worth metroplex) and have lived here since 1990.

I am in the baby boomer cohort and have lived on both coasts of the U.S. (including California three times — the SF bay area as a kid and SoCal twice as an adult) as well as overseas (Europe, Japan), and have traveled widely. I mention that so that you don’t think I’m just an uninformed home-town booster.

I happen to like California and in 2004 I interviewed for, and was offered, a job in Los Angeles. It would have meant a pay raise from about $52k to $62k (I work in academia, but have IT job skills that are also in demand in the private sector). Although the position itself would have been a good career move, when I checked into the housing prices, I was appalled. I’m a conservative (financially, not politically) — i.e. 20% down, 30 year fixed rate mortgage kind of guy — and it was obvious that at those prices I would never be able to afford a home of my own. I started giving a lot of thought as to what does determine quality of life and how does a decision on where to live impact that. I had been a long-time renter (mainly for career mobility) and I ultimately decided to stay in Arlington and buy a house here.

I eventually bought (July 2005) a 1400 sq ft 1950’s 3/2/2 brick ranch in an established, quiet, low crime, stable neighborhood, in a good school district area, and that was located two miles from my place of employment. The house is a prototypical mid-century modern tract ranch house with original hardwood floors, a (slightly less than) quarter acre yard, and mature trees, and was in excellent condition.

What did this cost me? The purchase price was $125,000, just slightly over 2x my then current salary — and I probably overpaid by about 5k because I really liked the house. If I hadn’t wanted an older home, there were also new homes at about $5-10k more in infill locations the same distance from where I work. What would it have cost me to buy a house like this, in a neighborhood like this, within two miles of UCLA (which was not where I was offered the job, but a close proxy)? Half a million? Probably more — substantially more.

So now I have a mortgage payment (including insurance and property taxes) of $950 which allows me to save for retirement, travel, and enjoy my other interests. I have a negligible commute (I’m considering getting a bike to ride to work) and often come home for lunch. Although I bought at the top of the bubble, home prices never had the double-digit appreciation here, so don’t have nearly as far to fall. There has always been low-turnover in this neighborhood (I looked here for a year to find the right house), so there can’t be too many FB’s to bring the comps down.

Yes, I think it would be nice to have a beach nearby to go to (in addition to previously living in SoCal, I also lived on the Florida gulf coast and I like to body surf). But if you have to commute two hours or more each way through the ever-worsening SoCal traffic (to your place of work as well as to the beach) from Palmcaster or San Bernardino, in order to afford a house on a salary like mine, what exactly is the point? How often are you actually going to go to the beach?

Yes, the weather is nice in SoCal — but it’s also pretty nice in Texas for nine months of the year. Summers are hot here, but once you get significantly inland in California, it’s just as hot. Yes, there’s lots to do (e.g. cultural, entertainment, shopping, etc.) in Southern California — but there’s also lots to do in the Dallas/Fort Worth metroplex. Good jobs in Southern California — good jobs here in DFW, too.

So what’s my point? As the bubble deflates and I see Piggington’s posters salivating at the median home price in a particular SoCal city coming down to an affordable level of $450,000, I shake my head and wonder in what alternate universe is that considered good news and people who were waiting to buy are thinking of spending that much for anything less that a house on the beach in Malibu? I don’t understand the disdain for “fly over” country and fail to see how any quality-of-life premium begins to justify the high housing costs. And I’m not even touching on things like the SoCal gang problems, air pollution, deteriorating schools, San Diego going bankrupt, prop 13, mello roos, etc. etc.

If I could buy a mid-century modern Eichler home in, for example, the San Mateo highlands in good condition for under $200,000, I’d seriously consider moving to California. Until then, I’m happy living here in Tejas and will occasionally visit California on vacation. Just a different opinion from an outlander in affordable fly-over country. Pile on. 😉

[waiting hawk]

Hit the nail on head. If it doesnt come down to my level I will look you up in Texas in 2008.

[Bugs]

Based on your lifestyle I think Texas makes a lot more sense than SD County. If I didn’t surf and if my extended family didn’t live in the area, I’d basically have no reason to live in Carlsbad. I can’t stand the yuppie scum with whom I have to share these roads, I’m not big into the nightlife or entertainment and I’d never drive down to the beach to hang out on the sand or watch the sunsets.

I have a friend whoes wife got transferred to Minneapolis for work. He says the people there are so much nicer than here that it’s not even close. Apparently, there are still areas of the nation where the first question out of someone’s mouth when they meet you does not involve what you do for work, where you live and what kind of car you drive.

Imagine that.

[eikoph]

Apparently, there are still areas of the nation where the first question out of someone’s mouth when they meet you does not involve what you do for work, where you live and what kind of car you drive.

Actually, in Dallas, it does matter what kind of car you drive and where you live; in Fort Worth, it doesn’t. I didn’t understand the micro-environments when I first moved here, and it’s funny how that stuff works. I go into Fort Worth all the time, Dallas only when I have to.

[Mexico Resident]

Well said.

[salo_t]

I’m starting to wonder what all the hype is about also. For sure its nice living in SD but its not so nice as to justify the cost of living here I’m not really into the beach but I do love the weather. I have also lived on both coasts and in the southwest and all have good and bad areas to live.
After eight years of living in SD I think I’m ready to take the next job offer and head out to Charlotte NC where my dollars will go much further. As a matter of fact a I write this my next door neighbor is loading a moving van and moving to Florida.

[little lady]

My next door neighbor (after renting for 10 years) just loaded a uhaul last month and moved to North/South Carolina.
He got a house for 90k, a job making the same money. He is saving about 1k from what he was paying in rent.

I have often thought there has to be “GOOD” places to live outside of SoCal, and I am sure there are. However, we do have housing in San Diego County for under 300k, its just out further. In Campo, Julian, and Borrego Springs houses are cheaper, though the commute could be longer depending where you find work, and farther to the beach.

[kev374]

I’ve been thinking about the same points you made in your post. It’s foolishness to pay a 300-400% premium for nothing, it’s insanity.

I’m expecting a total meltdown in SoCal RE, if not I’ll be packing my bags as well. I am in IT so Austin or Atlanta is what I am eyeing. I’ve checked wages there and it’s about 10% lower than SoCal, so imagine THAT! Earn 10% less but enjoy a 50% lower overall cost of living…sounds enticing enough. I do love the beach though but with the money saved I guess I could just take 2 extra vacations each year 😛

Also wanted to mention that although TX has high property taxes there is no state income tax so that’s a 9.3% savings right there!!!

[Anonymous]

I have been wondering for years why there hasn’t been a mass exodus from San Diego, especially of families with children. Real estate prices have always been out of whack here, but just completely outrageous in the last few years.

Living in SD is extremely overrated unless you are a young single professional who enjoys outdoors activities, beach, etc. If you have a family, on the other hand, your priorities should be on quality of life issues such as good house, neighborhood, schools, etc. and SD falls very short in these categories.

The sad reality is that even if real estate prices drop 50% from their peak, which I believe they will, prices will still be extremely high relative to the rest of the country, and will still be out of reach of the average family income.

[Anonymous]

Great points, eikoph. Yep, Texas is a nice place to live (I grew up in Austin).

San Diego is overrated, even for singles who enjoy the outdoors. We lived in Chicago and Minneapolis over ’90-’96, and there were very active single communities that took advantage of the lakes, cross country skiing, ice hockey, etc. There are lots of great places to live in the U.S.

I agree with kev374 that we are going to have a meltdown in home prices here in SoCal (that’s what you get in a depression, and that’s what we’re headed for).

Concho, it’s time for you to ‘tinkle on Texas,’ again.

The only thing that keeps us here is proximity to inlaws, who are great with our kids.

[North County Native]

My husband and I are considering Austin (Bee Cave looks like a nice place). He is an IT guy as well. We are still here so he can get his Masters degree and then we’ll move on. Pretty soon we will have 3 kids and we’d like to move into a house someday……
The one thing about Texas that scares me is the tornados! If I weren’t so scared of those things, we’d probably be there already! We really like Utah and Colorado as well. At least with Utah there aren’t any tornados but they have earthquakes there too!

At this point we’ve realized that finding a home we can afford and having the quality of life and allowing me to continue staying home with the kids will require us to move. Too bad almost all of our family is here though 🙁

[sddreaming]

To each their own. Wherever your heart is, that is where you need to live. Currently, I’m living in Ann Arbor, Michigan. Home prices are such that I’m looking to move back to San diego. I’ve been in Dallas many a times and I don’t see the attraction. Flat landscape, hot summers, icy winters, and yes, tornadoes.

Here, in Ann Arbor, it’s really amusing. I see articles in the paper that mirror SD. High inventory. Leading the nation in the bubble. EVERYONE wants to live here. (Don’t you just love that?) Doesn’t everyone want to live in Ann Arbor?

McMansions are + $1M. Typical suburbia is min $700K. Bill Ford just listed his home for $3.9 M. Land is roughly $100K/acre. For What??

Okay. This is a really great place to raise kids. Ann Arbor is the most educated city in the USA. I prefer my kids to think a PhD is the norm, as opposed to Botox and physical perfection. Schools are great. Weather sucks, but that’s ok. Kids love the apprehension of the next season. It’s a lot of fun. And you get days off school when the roads are bad and/or its too cold.

From San Diego, I miss so much, still. The Pacific. Rent a boat from Harbor Island Yacht Club and set sail for the Coronados. Set your anchor and sleep on the Pacific. Just inhale and exhale. That changes me every time. I love everything about the Pacific, I love the diversity of San Diego. Where else can you wake up in sunshine and 70 degrees, surf, drive east, see snow, and ski, come back home, and well, just love life? I could go on and on. What do you love the most about SD? Where else in the world can you find that?

I remember the first summer in Mich with my ex, a SD native. the mid of July I was frantically swatting flies away from my baby and me. He just watched me like I was totally nuts as I tried to explain that black flies don’t only bite, they suck. That first fly bite was priceless.

It’s a personal passion. If you don’t have it, then move. It’s important to youu then honor that. Do what is important to your own self.

[TheBreeze]

Arlington? Seriously? You’re seriously trying to compare San Diego to Arlington? My Gawd. I guess if I wanted my life to revolve around rodeos, high school football, and Monster Truck rallies I would move to Arlington. Otherwise, I’d rather stay here where there is some semblance of civilization.

And how can you stand those Texas summers? I visited Austin last summer and nobody wanted to be outside during the day because it was so stinkin hot. Is that really how you want to spend your summers? Locked inside because that is the only safe place to be?

There is a reason people live in Arlington and a reason people live in San Diego: People live in Arlington because they have to; people live in San Diego because they can.

[Anonymous]

I lived in Arlington for four years and the reason I moved to California had very little to do with the softball sized hail or the oppressive heat or the barren ugliness of the place…I left because I did not fit in socially. What I mean by that is, sure, someone in this thread joked about how in SoCal the first thing people ask you is what you do, where you live, and what you drive. Personally, I don’t see what’s so wrong with the first two questions. The one about caring what kind of car you drive is, of course, silly and shallow.

But the thing that drove me away from Texas was that the first question THEY ask you is, “What church do you go to?” I mean, seriously, I couldn’t get away from it. Religious fanaticism, bible-thumping born-again Christian insanity, is EVERYWHERE there. At least it was in the 90s when I lived there.

As an athiest who was raised in a Jewish household, I felt quite comfortable and welcome in Texas, by those friendly, open-minded Texans. Not.

[hipmatt]

Well, to the original poster, I believe you have piggingtons all wrong. I would summarize this blog as info on the housing bubble, especially so cal. I think its safe to say that most everyone here believes housing is in a bubble and is way over priced. This is a pro-housing correction blog, not a pro-california blog. Generally people don’t bash other places in the country to live.

You have every right to enjoy Texas, and I hope you do. I am definitely considering the move out of CA, and I will consider San Antonio and Austin.

[Author]

Posts