Bubble Exodus Or ‘The Best Move I Ever Made’?
Several readers suggested a topic on the housing bubble exodus. “I would be interested to hear from people who left California for the midwest and if they are happy with the decision to move or plan to move back once prices improve.”
Another added, “An overall topic of people who left CA and went somewhere else would be interesting. I left CA 6 months ago, now live in the Ozarks.”
And another, “How about some discussion of the ideas where large businesses in places like LA are relocating and selling their buildings for housing. Also Magjic Mountain selling out to developers. If the businesses and entertainment places sell out to housing, at what point would people not have any work, places to go for entertainment, or afford all of the new available housing.”
A business decision. “My brother moved his business from Anaheim to the midwest because of the cost of warehouse space. In Anaheim the warehouse rent was $7K/month, in the midwest he could buy a larger warehouse for $100K. Since his business is all mail-order and his employees were also willing to move, it was an easy decision despite his never living or working anywhere but the LA area.”
One went to Georgia. “I moved from Mission Viejo California to Ringgold Georgia where the entire county has a population of 55,000. Best move I ever made!”
And Arizona, “Best move i ever made. Kingman AZ. No gang bangers, just a few meth labs.”
Another asks for opinions, “I’m about to leave California for the midwest. I would be interested to hear from other people who have done the same.”
The Salinas Californian. “A decade ago, Mark Scarr said, his moving company had 10 families coming into the Salinas area for every five going out. Now, the opposite is true, said Scarr.”
“Average home prices are out of reach for 91 percent of the county’s residents, according to a report released by a group that promotes fewer restrictions on growth. ‘Young people that are wanting to find housing are finding it increasingly difficult,’ said Tom Carvey.”
“Scarr said his clients moving out of Salinas are mainly retirees whose home values have appreciated dramatically, so they can sell here and buy something nicer out of state. Jerry and Edrie Goldstein have their Maple Park home on the market and plan to move to Texas to live closer to their grandchildren. ‘We are not fleeing, and we are not trying to cash out our home,” said Jerry Goldstein.”
“They are asking $1.175 million for their five-bedroom home after buying it in 1998 for about $370,000, Jerry Goldstein said. He said they added a second story to the house and a host of other improvements. Goldstein said they plan to move to a nice neighborhood in the Dallas area, where a house similar to their Salinas home would cost about 40 percent less.”
“Compared with 2002, the county now has twice as many homes listed for sale. ‘Salinas definitely has a lot more properties on the market,’ said Jean Manner Schwimmer, a Realtor in Salinas.”
“(Property manager) Jan Leasure said rental vacancy rates have also been high, from 5 to 7 percent, for the past five years. ‘The rental market has been affected by the fact that there has been a mass exodus from the coast of California to the inland areas and other western states,’ she said.”
Thanks to the reader who posted this story in another thread. A few more comments from the topics thread:
‘I’m about to leave California for the midwest. I would be interested to hear from other people who have done the same. We have been unable to buy a house in California, but I am hoping we can buy something where we’re moving. I’m worried though because I don’t know if prices there are also inflated. My perspective on pricing is very distorted after living in SoCal for 7 years.’
‘Depends where in the Midwest. Most places have little to no bubble. However, my mom runs a title company in rural Indiana and she says she has seen some really loony I/O loans come through the pipe. I don’t think Indiana/Ohio/Kentucky/Tennessee will have significant price declines. On the other hand, don’t expect real estate prices to go up more than 1-2% a year…ever. Buy a house only if it’s cheaper than renting and do not base your house valuation on ever getting an equity return on your “investment.”’
‘
I left CA in 1999 (moved from SD to Mpls), but I kept my SD condo until March 2005. I used to go back to CA every month, but now I only go back 3 times a year’
‘I love Mpls.
Pros:
-both I and wife make far more $$$ here than we did in SD, and I make more than we could make in SF (she could make more in SF)
-it is beautiful here, super green in the summer
-I love the parks, lakes, bike trails
-I love the accessibility of everything. Unlike in CA, where -you have stuff to do- IF you can get a ticket
-There are lots of great restaraunts for me to go to
-the COL is so much cheaper. EVERYTHING is cheaper. Housing, food, parking, opera, sports, concerts, everything
-I love the arts here. Much better arts scene here than in SF or SD or LA IMO.
-Mpls seems to have a great mix between urban and parks/greenery, something CA doesn’t really have, except in the uber rich areas like Marin or La Jolla.
-it may not be too racially diverse (but it has a very quickly growing immigrant population from Africa, SE asia, and Latin America), but it is very tolerant of diversity, and a lof of ethnic things to do.’
‘Negatives:
-winter. It’s brutal. not much snow, but can get very cold. (down to the 20’s in day, singles overnight… RARELY it can go negative, but that might be a day or two per year)
-No ocean. (we do have a lot of lakes here, and Lake Superior IS huge, but it’s not the crashing ocean)’
‘The winter is a big negative> But my quality of life is so much better here in every single way except the winter. We talk about going back sometimes, but then we look at how far our quality of life would drop, so I doubt I’ll ever move back unless something seriously changes.’
‘At some point the winters will push me out… but by that time I’ll be semi retired and will probably move somewhere warm and cheap, to relax with my family every day and wear flip flops. Can’t do that in CA with a $1 Million mortgage.’
‘We took an early retirement and moved from Thousand Oaks Ca to where we grew up in Iowa. Although our kids loved it in Iowa, they could not think of any reason to stay there. They all now go to college here in the SW. I agree with you on the winters. We have followed the kids to the Phoenix area where we are renting until we know what we want to do. Our son lives in SD and is stuggling with the COL. Phoenix is a small town version of Southern Ca. We would like to see grand kids grow up instead of living half way across the country from them as we did while we were working.
As a family we loved spending time in Mammoth Lakes and were lucky enough to have purchased a place there before prices went through the roof. We have it in a rental program which pays all costs and will soon be mortgage free. We want our grand kids to enjoy this place as well. We learned that the midwest was not for us.’
‘When you travel are you able to go with the flow or do you get upset/tense when things don’t go perfectly. If you adapt well traveling moving is probably a good idea. If you get upset when things are not as you envisioned you may want to stay put. Neither way is bad - but it reflects you and change and people who adapt well to change do better with radical moves. If you don’t - great you know yourself!’
My wife and I sold our house in the OC last summer and have been renting close by ever since. We have committed to rent for the next two or three years at least, while we explore areas where we would like to eventually buy. We’re in our mid-50’s now and both work full time. We plan to explore some of the rocky mountain states (Id, Wy, Mt, Ut) to live in the summer months and be able to come to CA or AZ in the winter months. I’m the one who wants to live in the Rockies (I have a bad fishing habit ;-)) but I know if that is going to happen I need to get the wife back to a warmer climate for the winter and closer to her friends (if momma ain’t happy, ain’t nobody happy).
If prices were to drop significantly (which is what I think will happen) we came out with enough cash to buy a couple of modest houses (all cash) and still have a nice nest egg for retirement. However, it is more likely that we will rent somewhere in Southern Cal for the winter.
My wife and I along with my son who is in his first year of college have done the same. We sold our home last year and own a lot in Sedona,AZ. We have done extensive investigations on taxes in various states and find Colorado among the most favorable for land and SS plus other income. We were looking to build in Sedona but may change our minds as our lot more than doubbled in price making a home very expensive with property taxes. I also have a bad fishing habit tha I need to support along with wildlife photgraphy. Good Luck and hope to see you at a fishing venue some day!
The trick is to never look back. Always forward.
The above description of Minneapolis pretty much describes Portland, Maine, although we get a decent amount of snow. For me, the snow helps make winter enjoyable, except for the driving. But we’ve ;earned not to be out there driving if the conditions are bad. That’s usually during a snowstorm. Soon after the snow comes down, the roads are plowed and sanded. You just have to be able to sit out the drive during the storm. Otherwise winter is a great time. If I had a long commute by car, which I don’t, I’d probably have a problem with the snow. I work from home, as do a growing number of people in the market - particularly those moving in “from away” with their jobs.
A surprising number of these folks are from California and most love it here. The retirees come here with so much money from afar that they can slip away to a warm weather residence in winter - although many are “four season types” who like the four seasons.
We have friends who are moving to SF because of a job transfer and they are miserable. Their home here is on Casco Bay and is 5,000 square feet and beautiful. I believe they paid $400,000 for it six years ago. In SF, they’ll be nowhere near the water and won’t have the several acres of wooded property they have here. The one thing they’re happy about is they’ll be only 20 minutes from the airport which is important due to work related travel and traffic.
They thought about staying here and the husband taking a lower paying job, but they finally decided on the higher SF salary. They hope to be back in five years. Ugh.
From the new photo gallery, sign:
“Gordo Buys Houses 888-214-8950.
Gilbert, AZ
I wonder if we could get Gordo to come on this blog and tell us what he does with all the houses he buys. Anyone want to call him??
Please don’t.
LOL.
How can he afford to eat so much in a bad market? Maybe his name will change?
I have to admit I wish I’d waited 2 more years before selling and leaving CA. I thought prices were absurd in 2002… wanted to lock in my profits. I didn’t think at the time that people would be irrational enough to reproduce in housing, what had just collapsed in technology…
Be glad you got out when you did. There’s never an easy way to see the top until you realize it has already happened. If you made money, you’ll do better than the vast majority who purchased in the past 6 years.
Hey! I remember you from slashdot
“It’s better to be a day early than a day late!”
There are many people in Arizona that tried to time this market and blew it. Lot’s more than got it right.
I think it was Warren Buffet who said “Every investment I’ve ever sold, I’ve sold too early…”
Actually, it was an old-timer from early in the 20th century. Maybe Bernard Baruch — that era.
Baron Rothchild
With investing it’s good to get a “piece of the pie” rather than get upset if you didn’t get the whole pie. No one can predict the future..we just go with what we know. If you got some profit…be very glad you did. Better to sell while it’s going up instead now, when it’s going down.
I moved from California to Texas (DFW area) in 2003. I wanted out of CA because housing was sickly overpriced–I’m a computer programmer, and there’s no way in hell I’d be able to buy a house there. Plus, a 1 bedroom apartment near where I worked (Thousand Oaks) was $1200 a month. So, I talked my company into relocating me to Texas.
Saved up for a year or so in a cheap apartment and bought a house, which I could easily afford out here. Now I worry that the fall-out from the bubble may screw me too (I bought Jan 2005), but I figure that barring a depression-level event with protracted job loss I’ll be OK since my loans are fixed rate (compared to what some people are using, 80/15/5 is downright conservative…) and I don’t think my house is overpriced (1800 sq ft, 4 acres, 50 minutes from Dallas, $180k).
But on the other hand… There does seem to be a LOT of overbuilding in the rural’ish area where I am, and a lot seem to be aimed at lower-income families and people with dicey credit.
There’s this one area I want to take a picture of for this blogs gallery–about 5 different home builders of all stripes have big signs right next to each other, surrounded by smaller, shadier housing signs (e.g., “3/2/2 1 acre no money down!”, “Avoid foreclosure!”). All where two rural roads intersect eachother.
Maybe inflation’ll be what saves the DFW housing market, by making new construction much less affordable.
The biggest losses will be in the most overpriced areas. Look at it this way: you bought for $180K. If, in 10 years, you sell for $190K, you won’t be too bad (although you could have gotten better returns in other markets, you do need a place to live and most homeowners should realize that a primary residence is not an investment vehicle.) In other words, you should be fine as long as you are able to make the payments.
The people I am most concerned about are the ones who are buying $600K-$1.5M homes on I/O loans and then hoping to “ride this out.” Even if your home loses value, it’ll probably still be worth $150K. If you then decide to sell it, you’ll be down $30K… not great, but it’s a serviceable debt assuming you remain steadily employed. On the other hand, here in the Bay Area, there are those who will sustain losses in the hundreds of thousands of dollars. People here are STILL buying $1M homes with I/O loans. You want to talk about a bloodbath… $200K-400K losses will be the norm for those who bought here in 2005 and wish to sell in 2009-2011. That is not a serviceable debt for most people and those bankruptcies will drag down our financial system and the lenders that gave these fools sub-prime I/O loans. Those lenders will then request bailout from the Fed… we can only hope that the Fed will not continue its current policy of handouts/bailouts (S&L, airlines, automakers, utilities, Katrina, etc.) and drag the entire economy down with it.
I keep on hearing folks saying the FED will bailout bankrupt folks/lenders. We are BROKE! Plain and simple. By bailout, perhaps you mean creating more money. Great, but you do that and the foreigners holding our debt/buying more of it will come to a screeching halt when we bailout/create a few MORE trillion dollars. This “bailout” will be no different than us paying the foreign debtors. “Here, we just created 5 trillion. Boom, our debts are paid”. That is the pickle you get yourself in as a massive debtor. There are no happy options, only very painful ones.
If everyone had the discipline to replace the noun “government” with the noun “taxpayers” in virtually anything written, change might start taking place. Ain’t no such thing as “government” when you are talking about money. ALL government money was extracted, at the point of a gun, from taxpayers, or printed on machines without our vote, or borrowed from non-Americans without our vote.
Yeah, it’s never the U.S. government that owes any money, it’s the U.S. taxpayers that owe it through higher taxes. Making it sound like its somebody else who owes the money conviently supports the welfare state– which I support actually (and not just because it funds my income) so long as it is done rationally with public awareness of what is going on.
BTW, I have been getting more reports from people that the IRS has been much more agressive with collecting taxes and scrutinizing tax return statements. And that they are challenging more tax return statements, and claiming money is owed (including penalties and interest) on those still owing taxes. And they they are not just challenging the last year’s tax statements. They are going back as much as 5 years of statements.
Anyone have more info on this?
Actually Ben already posted a comments from a Fed Governor that state “there will be no bail out”.
This too was the case when prices plunged in SoCal ‘91 and Houston ’80’s oil patch…
No Bail Out !
Lucky for people in Los Angeles, they got FEMA to bail them out. They were able to use the Northridge earthquake as their saviour from the fall in home prices, unemployment, etc.
We don’t know what is going to happpen…but with all the coastal folks moving inland for more affordable housing….I would not be surprised if Dallas held it’s prices better than other areas. The difference in pricing is so striking I would not be surprised.
$180,000 for four acres is fantastic. I am so curious what your houose looks like.
‘$180,000 for four acres is fantastic.’
See, this is part of the ‘bid-up’ problem. Land in Texas can often be had for $6k/acre, or less. The bigger question is, what can you rent a similar property for.
There are huge swaths of land surrounding Austin that are only good for growing hay. And much more that isn’t good for anything.
In rural Denton County, where I am, land is around $10k per acre, give or take a few depending on location and if it’s part of a more heavily deed-restricted plat. I’ve checked the tax records for my property and the surrounding ones, and the appreciation of the land (assessed seperately from the house) doesn’t seem to be out of line with inflation over the last 5 years.
And in addition to Bermuda grass hay, it’s also good for millet and cattle grazing!
Denton county, where the Alliance airport is? And the big race track? Not many rural areas in Texas have those. I’m not sure if those facilities are in DC, but my point is that property north of Fort Worth did have a boom. That’s why Perot bought it up on the cheap after the last bust.
I should have said a “rural part of Denton county”; I didn’t mean to imply that Denton county was entirely rural. The southern 1/4 or so (which contains AFW–only part of it, I think–and the speedway) is pretty suburban. But the northern 1/2 to 3/4 is pretty rural.
Denton gets less rural every day. I live here, too. I’m happy with the quality of life. We live right next to the lake and have some acreage. The house was cheap (120k), but it’s good quality construction, built by the previous owner with reclaimed hardwoods, a huge wrap around porch and lots of trees.
The one thing I hate about DFW is the sprawl and McMansions. What I love is that there is always stuff to do in DFW or downtown Denton. The new performing arts center in the arts district along with the Nasher sculpture garden will really help the formerly struggling arts district. Mark Cuban has done wonders with our basketball franchise. The Bass family and Van Cliburn have been great for Fort Worth and the zoo there is second only to Disney’s Animal Kingdom, in my humble opinion. Then, of course there’s a million great restaurants and some good shopping locales. WIsh we were friendlier to small business, but what city is these days?
I’ve been involved with some zoning diputes in Denton. I wish we had the kind of restrictions that Austin has recently passed - no homes over 2300sf or 1/4 of the lot size. Collin and Denton are experiencing a business boom, which is contributing to the sprawl. There is real demand here, though I also wonder how many can actually afford the houses they are buying. I don’t feel that concerned about my property, however, since I think it would be affordable to the majority of people living here.
It’s amazing that Californian software engineers are priced out. My company employs about 90 software engineers (I am one of them) and the internally published median salary is $100K for that position. Even the principal engineers and software managers who are making $130K-$150K, refuse to buy a house now. And some of the smart ones sold.
I can only think of people in director roles (on the engineering side) who still own. I am unsure of their pay.
Your close. The problem is the market for products that are engineers do not support company prices to sustain $100K salaries. R&D is under cost cutting pressure.
Its no surprise that Sun Microsystems, Intel, HP are cutting R&D expenses.
There is no way to actually afford a house around here (SoCal) on a software engineer’s salary, unless you’re talking about a crack house in South Central with bars on the windows and shooting wars in the street.
Of course, with a $150K salary you could probably qualify for a suicide loan for $1 million or so; but software engineers can usually operate a calculator well enough to see how that works out. $1 million is barely enough for a condo in a nice neighborhood. So a software engineer can’t afford to buy without commiting either physical or financial suicide.
test test
“They are asking $1.175 million for their five-bedroom home after buying it in 1998 for about $370,000, ”
———————————————————————–
join the crowd. inventory is exploding, and affordability is 9% in Salinas. Traffic on the 101 is a nightmare all the time, not just rush hours. I wonder how many sellers will actually get through the door before it slams shut. John R. Talbott predicts a return to 1997 pricing in his excellent book Sell Now!
I live in north of Salinas. I have visited Salinas since late 70s. I just see any industry that supports that kind of prices. Morgan Hill Gilroy Salinas just makes no sense to pay $1M.
As posted before, we left the Bay area for Albuquerque. Big part was housing costs and inability to buy there. We got a nice house here and quality of life is much higher than in Bay area. I would never go back to live in that area.
Lots and lots of great reasons to leave CA. I did it, twice, and couldn’t be happier!
Housing costs (Exceeds 60% of gross for many)
Taxes on everything and a lot of them- Income, fuel, property… Saves me 10% on my income a year.
Schools stink
Traffic
Crime
Smog
Earthquakes
Overcrowding! This one is a biggie for me. I would end up doing nothing much of the time because I didn’t want to battle crowds -EVERYWHERE.
Everything else costs: Crap, I hated paying $7 for a beer at dinner. Why is it so expensive to go out or buy groceries etc? Because the high cost of RE permeates the entire economy with a multipler, as it scales. That’s why businesses MOVE AWAY. Their costs, driven by RE & Taxes make them uncompetitive. They need to pay their employees more $$$$ because they too need the extra $$$$ to pay for their overpriced RE.
Given all of these very real issues, RE will flat out collapse in CA. The $$$$ value of the collapse will sink the state’s economy and drag the entire country into a recession because of the credit market’s inability to stay afloat. ALl because of the FBs and the bubble no one in charge will admit even exists…
“Overcrowding! This one is a biggie for me. I would end up doing nothing much of the time because I didn’t want to battle crowds -EVERYWHERE.”
This is also a huge negative about LA for me, every day is crowded but holidays are a friggin nightmare here!
Tried to go to Newport Beach at 5PM. Traffic very heavy, so we turned around. Traffic leaving Newport Beach was still hell, but the weather was to die for!
Wanted to meet with friends at a local OC beach, but not go to the zoo on the 4th of July.
Apparently, we will have to adjust our plans for the 4th!
Could you elaborate on this more? When I think of the Bay area…I think of beauty, tons of cultural events, amazing geography, historical buildings. Of course, there is the high cost, too. Albuquerque sounds very OK…but how can it compare to the Bay area? Could you be specific as to what is an Improved quality of life? Congratulations nonetheless.
“Could you elaborate on this more? When I think of the Bay area…I think of beauty, tons of cultural events, amazing geography, historical buildings. Of course, there is the high cost, too.”
Living in the BA, and having been to Albuquerque, I’ll say that ABQ does not have the cultural events or the high prices. The Sandia mountains are prettier than Mt. Diablo, and there is definitely something to be said for the desert, so the geography argument is moot, IMHO.
Traffic can be “bad” in ABQ, but much better than the BA. I lived in west LA, so I personally think the traffic is not that bad anywhere else that I have been. The politicians in NM seem to be more beneficial to their citizenry than the BA politicians, so that’s another plus in their column. Historic buildings abound in NM, and Santa Fe is an hour away, and a neat place, but pretty much touristy fluff nowadays.
>When I think of the Bay area…
I think of the smell of stale urine. Take a walk down Market street in San Francisco someday. It reeks.
I nicknamed Market Street “Urine Alley.” I used to go to shows all the time at the Warfield, which is right on the worst stretch of Market St. and the smell of fermented urine could curl the hairs in your nostrils.
“…the smell of fermented urine could curl the hairs in your nostrils.”
ROFL
I am moving from San Diego to Tulsa Ok, in a month. Any advice for looking at houses in the midwest? How can I tell if the prices are reasonable or inflated?
Thanks!
OMG. San Diego to Tulsa OK. You have my sympathy. I don’t know what else to say.
Don’t listen to her, you’ll be fine. Lots of nice suburbs around Tulsa, find one closer to work. New construction everywhere, look for a house built on a quality lot that is on good natural terrain. Foundations are the biggest worry as almost everything now is on a slab and some lots are on built-up clay. New construction sells for $100/sq. ft. and used about $80 on a regular sized city lot. You might rent for awhile so you can take a good look around or go scout ahead. Builders are hungry to sell. Don’t bite off more than you can chew. Good luck.
I’ve been to Tulsa. Nice areas, but as I recall, a lot of bible thumpin’. You might be able to avoid it if you care to, or, join in if that’s your gig. Whatever the case, you’ll have a lot more $$$$ to go on vacations and do whatever, since shelter won’t consume your entire income…
If you want to move to OK Norman would be my first recommendation, Tulsa second. If you keep an open mind Tulsa’s a great city. Only there once but it left a favorable opinion. Yes, bible belt but a nice way to enter the community of you are religous. If not, find out where the other Californians are hanging out. If possible I would choose Tulsa over SD right now.
Another interesting topic - as the blue staters migrate red will the red states find their thinking challenged?
Joel Kotkin has noted that amenities like decent coffee, good books and so on are available pretty much everywhere now thanks to Starbucks and the Internet. Say what you will about chain stores, but there is something to be said for being able to get good coffee, decent furniture, etc. even if you live out in the boonies.
Time was, I had to make special trips into Berkeley to Shambhala Bookstore in order to get my occult book fix. Now I can do so at the click of a mouse. Remember the much-vaunted “wonderful independent bookstore” or coffeehouse or whatever was only available to the privileged few in places like San Francisco.
My long-winded way of saying yes, I think there will be an influx of bluethink into the red states. When people can live in Podunk and still get a good cuppa, and furnish their houses and buy imported olive oil and all those little things that might seem laughable but people really do value them…then the educated and liberal are going to start flocking to the red states where the cost of living is lower. I predict some very interesting results.
“bluethink” is funny.
Remember, though, that y’all might not be as welcome as you think, in these places. Recently, when I went to look at properties in the South, I was asked at one house my reason for leaving Florida. I replied, honestly, that I want to be as far as I can be from Yankees. Don’t care who is offended by that — it is, at least for now, my right. One seller, a pilgrim Yankee, was put out by that. No problem — I scratched her house off my list. Her house is still for sale, almost a year later.
Southerners almost never move to Yankeeland to retire. That fact often pisses Yankees off to no end, but it is, nonetheless, the truth. If they are instead grateful, so am I. Yankees never try to learn why we do not want to move to their land — it seems to me they’d rather be pissed off and fire back.
Geographical culture is not, as some would hope, readily interchangeable. Do not expect to be welcomed to a community, at least in the South, if you do not want to adapt to its culture. Moreover, hold no hope of changing it.
Wonder how many Yankee flames this might draw. Notice that I’m not talking about their turf, by the way.
I’m an independent politically, and a pantheist religiously - but whenever I spend time out under the big sky, especially with my 2 1/2 yr old daughter, rather than doing the manhattan rat-race and living in my NYC shoebox - I find myself more and more inclined to believe in God and love this country, in the conservative (which to me really means, “conserve” - want to keep it this way) sense, warts and all - maybe the move outward will affect “blue staters” in the “red” direction (hate those terms b/t/w) as well as having a tempering effect on the red staters ???? Hard to say, but making fairly radical moves at least exposes people to the way others actually live.
Texas not only welcomed that Yankee Bush, they elected him Governor over a true southern lady. There’s very little local culture left anywhere now, even in the South. It’s McMansions, Walmart and Starbucks just about everywhere you go. We’ve lost so much of our history and historical values, that we were easily taken in by an all-hat-no-cattle cowboy with a fake accent. Northerners have come, they’ve been welcomed with open arms and they’ve changed the culture, both for the better and for the worse.
Keep in mind if a state voted 51/49 then it is called blue or red as the case may be. Truth is those evil blue / red people are all around you! Right now!
Oogedy boogedy boo!
Why do we lack the term, “bluenecks?”
My brother moved from New York to rural North Carolina about 5 years ago. He’s had no trouble adapting to the Southern culture. He has taken up NASCAR, BBQs religiously, and he even speaks with a little bit of a Southern drawl now. He even bitches about Northerners moving to the area and raising taxes
I wouldn’t have thought so but he seems a lot happier down south.
The subject of migration and its political ramifications (such as red or blue minded people).
I think that California got hit harder than most other states after the 2000 election “fraud” and many people moved to California for refuge. That migration caused increase demand for the finite housing currently available and cause prices to go up expotentially.
If more states develope a political mindset like california through migration out, because of the un-affordability to live in california. I think those other states, may experience a critical mass of conciousness shift in thinking, more in line with the progressive california mindset. End result could be that more states will have a concern for health of the people, the environment, appreciating of diversity, and protection of civil rights.
Heat? Humidity? Y’all can keep that to yerselves thankyeverramuch.. If you wanna keep the yankees away, just raise your taxes!
I moved from San Jose to near Springfield, MO. I am 2 hours from Tulsa via I-44. Regarding the bible-thumping, yes, it’s true, most everyone seems to be religious. A common and accepted question is what church you belong to. I have gone with the flow and go to church once/month. I stuck a Darwin fish on my car though and when really pressed, admit that I am “not religious”. The sermons can be very entertaining though, the people are wonderful, I just block out the religious stuff and enjoy the rest. It’s a new experience so it’s kind of fun.
I will say that some of the people are OVERLY religious, and I stay away from them. But there are plenty who are moderately religious and I suspect some closet atheists and agnostics amongst them.
The bible thumpers in red states are analogous to the overzealous environmentalists in blue states. Having lived in rural and urban parts of the country I find the similarities between the two different sides of the coin to be striking. So what it boils down to is there are annoying, big mouthed, self righteous people everywhere. Their outward manifestation varies with location.
Yes but there’s one little difference. The bible thumpers believe everyone but themselves is going to Hell. But the enviromentalists believe everyone, including themselves, is going to have to suffer from global warming.
good response.
“I stuck a Darwin fish on my car though and when really pressed, admit that I am “not religious”.”
Believe me there is no end to rigid dogmatic beliefs, both theological and otherwise, in San Francisco. This was the home of Jim Jones after all. And you had Heaven’s Gate down in San Diego. I think you’ll be getting away from a lot more crazy beliefs by moving away from the Bay Area at least.
Like you at church, I just nod my head vacantly when people start expousing their silly opinions based on Maoist ideologies. Sometimes I question them with feigned interest to get them to explain their points a little better, and within a minute or two it usually becomes logically untenable, at which time I point out their fallacies as their argument easily collapses. But it’s rare I actually do that. Sheesh, no wonder there is such a big bubble here.
Tulsa? You’re in for some good eatin’. The barbecued bologna can’t be beat!
I am relocating for work from OC to Portland, OR. Even though employer is paying for the move, I wanted to move a few items myself. A 4×8 trailer one way from Uhaul…To Portland…$498, but the reverse direction to Capo Beach, only$29. It looks like the migration is on.
Just sold in Westchester, NY. Relocating to Las Vegas and will rent as long as it takes until prices come down.
Hmmmm I assume Portland prices are less than California’s but I think they have bubble there, too. I’d wait it out a few years…but that is my humble opinion.
But I have visited Portland and it is lovely in many ways.
Agreed. Prices –though nowhere near as insance as CA’s– have gone up a good 40-70% over the past (http://www.ofheo.gov/media/pdf/2q05hpi.pdf). I’d rent and wait it our a while.
meant to say “over the past 5 years”
My family moved from the Bay Area (Oakland/Berkeley) to Seattle last year. We sold in July 2005, right about at the peak. We’ve found the housing here to be about 50-70% of BA prices in comparable neighborhoods. Seattle is a ‘tweener area — it didn’t rise as fast as the bubble areas but it has gone up quite a bit.
We moved into one the best public school districts in WA (and probably a top 15 district when compared to CA). When we bought last year, land prices were about $450k for a .25 acre lot whereas a comparable lot in the “best” school districts in CA (eg, Piedmont, Palo Alto, Cupertino, San Merino) are probably $750k-$1.5MM. You can still find newer 2000+sf houses in good school districts for $500-700k, but you have to go further out and deal with the horrible traffic here. It works well for a lot of people here who work in the suburbs.
My wife and I are both profesionals, had significant house equity, and a new child. We always thought we should be getting more for our money. Now, we’re very happy to live in a bigger house, in a great community and school district, pay no state income tax (9.3% in CA), live 10 minutes away from downtown Seattle, enjoy the outdoors, and enjoy the wonderful Seattle summers. The downside? We no longer have as many great restaurant options (although with kids its not as important to us), the winters are colder (no snow where we are though), much more overcast (that’s an issue), and the traffic is bad (light rail in 2009+ should help). We also miss our friends and family, but Seattle is very, very kid friendly and social circles tend to form through the kids.
I think Seattle is a good option for Californians who built up some equity, want to be near a major blue-state city, and still maintain a high standard of living wrt food, activities, events, etc. The Sound and the lakes are as beautiful as any CA coastal area, so you lose nothing there.
Currently, there’s a condo boom, and I fear it will deflate in the next year or two. But there’s a lot of opportunity to own SFHs in good areas that are still reasonably priced. Like I said, Seattle is a ‘tweener, offering a lot for the money and some saftey from the bubble if you buy in the right areas.
this is off-topic but I figured many would be interested. a whole bunch of currency ETFs and a commodity ETF has been launched.
this one is very interesting.
“Recently, iShares has also introduced its iPath Dow Jones-AIG Commodity Index Total Return Exchange-Traded Notes (nyse: DJP). It’s a mouthful, but essentially this ETF consists of unsecured debt securities issued by Barclays Bank that are linked to the total returns of the index. It has an expense ratio of 0.75% and provides exposure to the following commodity groups: energy 30%, livestock 9%, precious metals 9%, industrial metals 21% and agriculture 31%. Based on monthly returns from March 1991 through March of this year, the index has had a correlation of only 9% to the S&P 500 index and 23% to the MSCI EAFE index. The index is made up of the prices of 19 exchange-traded futures contracts.”
Tapping Into The ETF Gusher
Rydex launches more currency ETFs
There was also a Gold Miner’s ETF launched recently by Van Eck. The ticker is GDX, and it’s an index fund that emulates the Amex Gold Miner’s Index (GDM). The annual expenses are a bit high for an index fund, at 0.55%, but not too bad considering that it’s tradable, unlike a mutual fund…
I was born and raised in Sandy Eggo. I lived in the Bay Area for 18 years. Last year, we sold our house for twice what we paid for it and moved to Lexington, KY. We paid cash for a nice house, have lts of money in the bank, and after a year I’ve started looking for a job. I do not miss the stress, the traffic, or the craziness of CA. Lexington is a nice place to live. California is a nice place to visit.
Visited Lexington 25 years ago for some Thoroughbred seminars. If you’re into horses, it’s heaven on earth.
I moved from SoCal to Colorado in 1990 because I never thought I’d be able to buy a house there. Plus, I was sick to death of the traffic, smog, crowds, crime, graffiti and high costs even back then. Right off, I reduced my rent from $750/mo. to $450/mo. I moved to Fort Collins first, which I adored, but which has grown a lot since I lived there. The people all over Colorado, with the exception of Boulder, are the friendliest, most open people you’ll ever meet. Since I got a job in Denver, I had to move out of Fort Collins and I bought a 2700 sq. ft. house on 2.3 acres in the mountains west of Denver for $200,000. It hasn’t gone up much since then. If you move out of California, don’t expect your house to be an “investment.” Things don’t move up here very much at all, like most of the Mid-West. Also, think about this — what if the housing market doesn’t fall all that much in California. You might leave and never be able to return. Which is the situation I find myself in right now. Although the winters in Colorado (except in the mountains) are much milder than, say in Michigan or Minnesota, there’s still a winter here and I’m tired of it. I would like to return to California someday, I miss the beaches and nice climate near the coast. But things would have to go down an awful lot to be able to return. Also, when you leave California, you are perhaps leaving family, friends, and contacts you have there. But if you’re looking to reduce your cost of living and looking for a great place to raise a family, I highly recommend Colorado. We’ve got the highest foreclosure rate in the country, we never had the bubble, so it’s a buyer’s market out here.
there’s still a winter here and I’m tired of it. I would like to return to California someday, I miss the beaches and nice climate near the coast.
Kind of reminds me of the old sayings: “absence makes the heart grow fonder”, while “familiarity breeds contempt”.
CArefugee, you have been gone long enough (16 years) that what you are “missing” is not the real California at all: it is your fading (and increasingly selective) rose-tinted memories combined with a fake Hollywood fantasy-projection of what you WISH the “average” California lifestyle to be. Yes, life can be good if you live by the beach. Good luck with that –the cheapest homes anywhere near water will set you back several $million.
The rest of us live inland, where it gets up to 90-110 degrees for up to half the year, and you get a nice “view” of the smog & urban sprawl while you fight gridlock and crowds literally everywhere you go. The only “fantasy” part of living here for the non-super-wealthy is dreaming how to get the f@ck out of this insanely overpriced, overcrowded, polluted hellhole (Ok, maybe I’m unfairly criticizing the whole state based on L.A.).
If you ever get nostalgic for CA, I’d recommend coming back for a month or so. Within half that time, you’ll remember why you left in the first place. By the end of your stay, all of your gauzy nostalgia will have completely evaporated, and you’ll cheerfully head home –with no regrets.
Also, when you leave California, you are perhaps leaving family, friends, and contacts you have there.
This is always a difficult thing to do, I agree. Luckily, I don’t have this problem, as nearly all of my family have already bailed, with me soon to follow. Even so, consider what kind of “friends and contacts” you are leaving behind vs. the new friends you are making in Colorado. I can’t speak for CO, but a lot of the people you find here frankly aren’t all that hard to leave behind (Hint: there’s a reason why Californian’s are often stereotyped as shallow, greedy, materialistic and arrogant).
Ny closest friends have moved to Inland Northern California and Pennsylvania. Neither are particularly happy with their move, except financially.
Have your friends just recently moved? If so, then perhaps they are going through the typical period of “strangeness” and “mourning” for the area/friends they left behind, as they adjust/adapt to their new surroundings. I moved to the South in the 90s (ended up moving back due to family crisis, not by choice) and experienced this as well. At first you will feel very isolated and lonely, this is very natural. Then as time goes on, you will adjust and make new friends. Pretty soon –assuming your transition works out ok– you will come to regard your new neighborhood as “home” and your psychological adjustment will be complete.
This is human nature.
there’s a reason why Californian’s are often stereotyped as shallow, greedy, materialistic and arrogant
Are you sure they are Californian… next time check how pale they look LOL. Many of these greedy materilaistic and arrogant people actually are from the East Coast.
Hey guys,
I moved out of the Antelope Valley (Palmdale) last month to Huntsville, Alabama. We love it here! No gangbangers at every major intersection, GREAT schools! (The local high school graduates nearly 100% of it’s students and 96% go onto college. Every 11th adult is a scientist or engineer. Lots of tech jobs, everyone is from somewhere else (an oddity in the South to be sure). People are polite and they actually want to know their neighbors! And housing, well, Huntsville had a 20% run up in the last 4 years, but you can still buy very well made homes for $100 a sq/ft:
Granite counter tops
crown molding
hardwood floors
full landscaping
big yards
low taxes (0.33 - 0.57 % assesst value)
dirt cheap electricity (7 cents a kilowatt hour)
low insurance (auto and home)
87 octane gas is $2.51 and 93 Super (not CA 91) octane is $2.71 a gallon
lots of resturants
a minor leage baseball team for the Millwake Brewers
a minor leage hockey team and arena football team
water parks muesems, parks, the montains
An international airport (yes 747’s)
Atlanta, Nashville less than 2.5 hours away
Antelope where? What was I talking about?
Gee Let Em Burn, I’m wondering if I could get my husband to transfer to Alabama. You made it sound like such a great choice!
Tech jobs, strong schools, nice polite neighbors, and no “outsider” designation….and incredibly low taxes and utilities to boot!
Yep, Hunstville is a special place. I was stationed there from 1978-1982. It was the probably the best tour I ever pulled in the military. Of course, that was a long time ago but has only got better since then.
Lots of nice people, good places to live. Back then, the food was GREAT. Many small restaurants, still remember the lunch specials.
If you’re looking for an alternative and you’re in some scientific field, Huntsville deserves special consideration.
Let ‘em Burn — please enjoy Alabama and do not try to change anything there. It is the outsiders who try to make things like they were “back home” that cause friction. Hopefully, you already understand that nothing much in Huntsville will be like it was in California and, to you, that either is a good thing or an OK thing.
Tonight is my Defend the South night, courtesy ‘o Jack D and Maker’s Mark.
I agree, we don’t cotton to that kind of thinking. If things are so great back where you were, why did you leave? If it is just to make a cheaper San Diego in Huntsville then you are going to be wildly unpopular.
“The people all over Colorado, with the exception of Boulder, are the friendliest, most open people you’ll ever meet”
having lived in boulder for thirty years, i might want to add that the only reason for the above mentioned problem is because there are too many damn people from california and new york living here. it was a quiet midwestern town until it got californicated.
Give ‘em H. E. double hockey sticks boulderbo.
Yes, unfortunately, californication is a problem where there’s been a lot of transplants.I’ve heard of people who’ve lived for years in Phoenix and Seattle complain about it, too.
But to be fair what are those of us BORN in Californian supposed to do as our state becomes more and more grossly overcrowded? I would live in the San Diego of the 80’s and the OC of the 70’s but now both have been destroyed and I’m childless so don’t blame me!
Yes, but why go to the trouble of leaving CA or NY if you only want to make wherever you go just like where you left, only cheaper? People resent this bubble because it is fake coastal people with fake money which will never be paid back. The entire country is corrupt and the currency is debauched. Nobody wants to work anymore because the money is worthless. By all means San Diego RE Bear, try to reform the midwest so they can all be phony like you. Just don’t expect people to thank you for serving up the blue state kool aid when you get there.
Mort,
SD and OC aren’t that far gone - yet. They don’t drink the B.S. Kool-aid there.
I was actually responding to an earlier overly exuberant post by San Diego RE Bear:
as the blue staters migrate red will the red states find their thinking challenged?
I just hate it when someone feels the need to “enlighten” me. Sorry, S D, my reaction was overly hostile. Peace out.
Man, you made me cry flashing back to the San Diego of the 80s. What happened? I would settle for San Diego of the 90s. Too bad that’s long gone. California was ruined by immigration before California refugees ruined these other places.
California was ruined by immigration before California refugees ruined these other places.
——————
Ditto, again. We “Californicators” wouldn’t have to leave California if everyone else weren’t moving here in the first place. Most of us would prefer to stay in our home state, but are forced out by immigrants from other countries AND other states. You’re only beginning to experience what we’ve been going through for decades.
Sorry for the rant, but this really bugs me.
weren’t = wasn’t…
A lot of those immigrants are ‘red state’ refugees. I know several people who left Texas once the politics started shifting so far to the right, rather than stay and try to get back some moderate leadership. I have no idea what they accomplished, besides buying overpriced housing. As screwed up as our politics are here, at least our state isn’t bankrupt.
Echo that!
sold my home of 14 years in studio city in spring 0f 05,took the profit and ran to pismo beach calif where i rent a one million dollar beach housr for 2k a month,it was the best move we ever made,no traffic crime or pollution…the negative….hard to make a good living here jobs are scarce,but i have 400 k of bubble money sitting in cds so my wife and i have some time…in fact i havent worked in over a year,real estate prices here are also outrageous but dropping the houses that were 800k last summer are now 700k the 600k are 500k.we picked a very beautiful area but extremly expensive real estate wise…we are now researching other areas that are beautiful but less expensive….any suggestions
What type of geographic “beauty” are you in search of?
I sold my place in San Jose in October and walked away with $500K tax-free. I’m burned out and obsolete as a software engineer, so I figure I’m retired. There’s no possibility I’ll ever qualify for a mortgage of any size, never mind my old house at a “reduced price” in California five years from now.
Not that I would want to. I’ve had it with the constant low-level reminders over the past decade that for all but the rich, the Beach Boys’ California of the 60’s is slowly but steadily and irreversibly becoming a window into the third world.
I’m renting in Silicon Valley now while my girlfriend’s kids finish high school. With money in the bank another year or so of investing will help my nest egg so that’s just fine with me.
The next step is to move to southern Colorado. I got lucky in May/June when I found 35 acres at the top of a mountain in Colorado and bought it for $30K. In another couple of months I’ll start construction on a nice log cabin on that site (hence my screen name here). My ballpark estimate so far is that I can build and furnish a very nice 4000 sf cabin with a well, solar electricity and heat, a septic tank, and satellite TV, internet, and phone for about $300K.
As a software engineer, always worried about being laid off, $90K a year — a salary I had for only two years near the end of my career — left me with $30K a year after paying 40% in taxes and $2000/mo for house stuff. $200K in the bank at 10% will give me $20K per year of spending money, minus maybe a grand for taxes. So my standard of living won’t really change that much.
If you’re in a position where you can cash out for that kind of money, that’s one way the next chapter of your life could play out.
Where does one get a solid 10% on their money? I invest for myself…and I know CD’s are not at that level. Can you share please?
I would like to get out of California, too for similiar reasons. Congratulations on your new life.
Holy cow, take two days off and I can barely find the thread again, never mind my own comments.
Well you got me there — it’s not a “solid ten per cent”. I’m making more than 10% this year shorting the homebuilders even though I haven’t caught the whole move AND I’ve been scared out of some trades that would have eventually made me money.
As for something less high-wire, but still a good bet, consider something I wrote the other day (Wednesday night?) on another thread: going back to 1990, if you buy the SPX on the close of the last day of the month and sell it at the close the next day, it’s a winner almost exactly 5/8 of the time, and the winners are bigger winners than the losers are losers. (Today was typical: the SPX was up 0.79% close-to-close.)
That one-day trade 12 times a year by itself has been good for 4-5% 30 times out of the past 36 12-month periods; the other 6 times it was in the 2-3% range; it was never negative. If you can get 3-4% on your money-market stuff for most of the year and pep it up by that 4-5%, you’re in the 10% ballpark.
FWIW, I think short-term rates are going nowhere but up.
4000 sf cabin? Hellooo. That’s a wooden mansion.
Not really, You can’t call it a mansion untill it hits 8,500 sqft anything less is not a mansion.
Everything is relative. My own tastes tend toward Small House Movement bungalows. By older standards real cabins are under 1000 square feet and usually well under. Mansion level hits at around 4500 square feet depending on design. No one can force a metric on anyone else, but it is kind of interesting to compare. To me 8500 square feet is an unusually large mansion.
lol… I had the same thought. I wouldn’t call any 4000 sf structure a “cabin”, but that’s just me. I also think it will be very hard, or at least prohibitively expensive, to heat and cool on just solar.
This won’t be something built to show off or to intimidate — about 1500 sf would be basement, “the cheapest heated space you can build” according to most sources. (Where do they put the water heater or furnace or seasonal clothing or even the washing machine for that matter in those showplaces in the magazines?)
BTW, a basement keeps the rest of the house warmer than it would be if it had been built on a slab, even if the basement isn’t heated at all.
And, in some areas of the country, your property tax is based only on the square footage above ground. Another trick to keep those yearly expenses down, if it applies.
I am curious too —how can you fund your retirement income liability on 200k?
Good question. I’m retired, have a so-so Army pension plus social security (my wife and I both draw it) plus 401k plus investments (not spending that for another 5 years or so) and make quite a bit more than $20k. And even living in Mobile (fairly cheap cost-of-living) we still have to watch expenses pretty closely. So I’m always looking for better investment opportunities.
Retirement can get kinda expensive especially with a house. Not sure $20k a year is even possible to live on. Especially factoring in inflation 5-10 years down the road.
The nice thing is that there still are alternatives. Some friends of my now-gone parents had to retire on a pretty meager income. They bought a double-wide in Kentucky, out in the ultra-boonies, and lived relatively quite well the remainder of their years.
A fair question. The short answer is that I happen to know that I can do it based on being unemployed so frequently and for such extended periods of time. (If al-Queda wanted the cheapest and most optimal method for bring our society of overproduction and overconsumption to a screeching halt overnight, they would read Atlas Shrugged and webcast a summary of my 15 years as a Silicon Valley software engineer to every working and undergraduate engineer in the nation.)
Start with the following: no mortgage, no heating bill (note to HHH: SE Colorado / NE NM has 300 days of cloudless sky per year and only 15 inches/year of precipitation), no electric bill, no water/sewer bill, no car payment (I’ve owned three cars in 25 years and still have two of them; I’ll buy a used 4WD truck when I’m in CO), no ex-wife, no kids, no debt.
Next, there’s a lot of stuff I just don’t spend money on, period. I don’t have even mildly costly hobbies or activities. Nothing for sports (playing or watching) (my bicycle and weight set continue to serve me well), video games, slightly-more-functional-than-last-month electronic equipment, cook-one-thing appliances, etc.
Satellite TV is $30 a month now; satellite internet will be less than a hundred on top of that eventually.
Then there’s just being a cheapskate. My average yearly totals for fancy restaurants, clothing, phone service, car repair (I do most of the easy stuff myself), booze+mixers for the house, and DVD+music magazines, and cat food and expenses are in the very low hundreds per year. No more than $300 for each of those categories and maybe three or four more categories that don’t come to mind as quickly.
Health insurance for me right now is $300 a month. That’s gonna go up 10% a year I know.
I’m a really good cook and I happen to know that I can make myself just about (not-fancy-) restaurant-quality food three times a day for $150 in groceries a month. I know that’s less than half of even USDA Food Stamps standards cost-wise; they’re cooking meat loaf and lasagna and I’m cooking jambalaya and Pad Thai. (I’m a good cook so I make a lot of Chinese, Thai, and Cajun/Creole stuff for myself. It’s not the cheapest four or five soup-kitchen meals all year long.) (I think it’s that simple — it’s cheaper to get calories from rice & bread & vegetables than from big cuts of meat and cheese, and more taste from spices and sauces and less from fat.) That’s a whole website waiting to be constructed. If I had a throwaway email address, I’d post it for anybody who wants a bunch of recipes just to show you that I’m not just making stuff up.
I love to travel. My girlfriend and I had a great week-long vacation in New Orleans and vicinity for about $2000. I can almost find a flight for $500 or less (which on average will be less from CO, being closer to the center of the country, than from CA) and $75/night or less for a hotel. (I’m not flying to New Orleans so I can spend $150+ a night to see the inside of a hotel, or even its nice atrium, for example.) Let’s say one or two nice trips like that a year, and two or three more to visit family.
Miscellaneous includes Christmas and birthday presents and a couple of other categories that don’t come to mind right now. Remember that when I move into this cabin I’ll have all new furniture, appliances, plumbing, roof, floors, etc. I try not to think much at all about the fact that some of the stuff (e.g., roof, plumbing) is either implicitly or explicitly guaranteed to have a longer lifespan than I do at this point.
Quite frankly, let’s call it $400 for health insurance and $150 a month for food; those are just about the only expenses I absolutely cannot avoid. Satellite TV + internet + phone will be maybe $150 in the “almost cannot avoid” category. Let’s add another $100 a month in miscellaneous, not even the miscellaneous I was able to detail above. That would leave me about a thousand a month on average for all the other things I mentioned specifically or mentioned without remembering exactly what they are.
BTW, I am *not* counting on any Social Security benefits in this scenario, ever. (That said, for anybody turning 62 soon, I think the numbers show that it is better to start receiving benefits at 62 vs waiting until 67. Waiting until age 67 means you don’t break even on the higher payments until like age 83 or so, and that’s assuming the benefits you receive from age 62-67 were stuffed under the mattress in the meantime. If you get interest on the money, that break-even age rises dramatically with the interest rate; at an interest rate of maybe eight percent, you never break even by waiting until age 67.)
damn this $#@! board software ate a real epic response. then when I tried to repost it, it said I already had.
Here’s part of it, let’s see if the smaller version posts:
A fair question. The short answer is that I happen to know that I can do it based on being unemployed so frequently and for such extended periods of time. (If al-Queda wanted the cheapest and most optimal method for bring our society of overproduction and overconsumption to a screeching halt overnight, they would read Atlas Shrugged and webcast a summary of my 15 years as a Silicon Valley software engineer to every working and undergraduate engineer in the nation.)
Start with the following: no mortgage, no heating bill (note to HHH: SE Colorado / NE NM has 300 days of cloudless sky per year and only 15 inches/year of precipitation), no electric bill, no water/sewer bill, no car payment (I’ve owned three cars in 25 years and still have two of them; I’ll buy a used 4WD truck when I’m in CO), no ex-wife, no kids, no debt.
Next, there’s a lot of stuff I just don’t spend money on, period. I don’t have even mildly costly hobbies or activities. Nothing for sports (playing or watching) (my bicycle and weight set continue to serve me well), video games, slightly-more-functional-than-last-month electronic equipment, cook-one-thing appliances, etc.
Satellite TV is $30 a month now; satellite internet will be less than a hundred on top of that eventually.
Then there’s just being a cheapskate. My average yearly totals for fancy restaurants, clothing, phone service, car repair (I do most of the easy stuff myself), booze+mixers for the house, and DVD+music magazines are in the very low hundreds per year. No more than $300 for each of those categories and maybe three or four more categories that don’t come to mind as quickly.
Health insurance for me right now is $300 a month. That’s gonna go up 10% a year I know.
I’m a really good cook and I happen to know that I can make myself just about (not-fancy-) restaurant-quality food three times a day for $150 in groceries a month. I know that’s less than half of even USDA Food Stamps standards cost-wise; they’re cooking meat loaf and lasagna and I’m cooking jambalaya and Pad Thai. (I’m a good cook so I make a lot of Chinese, Thai, and Cajun/Creole stuff for myself. It’s not the cheapest four or five soup-kitchen meals all year long.) (I think it’s that simple — it’s cheaper to get calories from rice & bread & vegetables than from big cuts of meat and cheese, and more taste from spices and sauces and less from fat.) That’s a whole website waiting to be constructed. If I had a throwaway email address, I’d post it for anybody who wants a bunch of recipes just to show you that I’m not just making stuff up.
I love to travel. My girlfriend and I had a great week-long vacation in New Orleans and vicinity for about $2000. I can almost find a flight for $500 or less (which on average will be less from CO, being closer to the center of the country, than from CA) and $75/night or less for a hotel. (I’m not flying to New Orleans so I can spend $150+ a night to see the inside of a hotel, or even its nice atrium, for example.) Let’s say one or two nice trips like that a year, and two or three more to visit family.
Quite frankly, let’s call it $400 for health insurance and $150 a month for food; those are just about the only expenses I absolutely cannot avoid. Satellite TV + internet + phone will be maybe $150 in the “almost cannot avoid” category.
BTW, I am *not* counting on any Social Security benefits in this scenario, ever. (That said, for anybody turning 62 soon, I think the numbers show that it is better to start receiving benefits at 62 vs waiting until 67. Waiting until age 67 means you don’t break even on the higher payments until like age 83 or so, and that’s assuming the benefits you receive from age 62-67 were stuffed under the mattress in the meantime. If you get interest on the money, that break-even age rises dramatically with the interest rate; at an interest rate of maybe eight percent, you never break even by waiting until age 67.)
This damn BBS software ate a real epic response. Maybe it was too long. The short answer is that I happen to know that I can, based on my many times unemployed. Remember that I will have no mortgage, no heating bill, no electric bill, no water/sewer bill, no ex-wife, no kids, and no debt.
The only monthly expenses I really must come up with are health insurance (currently $300) and food ($150 — that’s a whole website, how to eat restaurant-quality food for less than half of what the USDA allows for food stamps). Very nearly mandatory will be internet+tv+phone, that will be about $150 a month or less.
I don’t have a lot of expensive hobbies or activities, so I won’t be buying a new car every couple of years, a lot of electronics or DVD’s, sporting equipment or tickets, etc.
And my expenses for clothing, for example, are pretty much “in the noise”.
Just an observation, but you might want to factor in home repairs and maintenance on that super cabin in the mountains, and subsequently invest in a snowmobile to get you to and from your vehicle at the bottom of the mountain in the dead of winter as you find yourself back in the workforce because the 20k is gone in a few months time and you are so hungry you could eat your own arm…
We moved from DC last year to a small, colonial era town on the Eastern Shore of MD. Selling our house meant we could buy a house here and have a very modest mortgage, I could start my own business and have a much slower pace of life.
We are a few hours from DC and do go back on occasion to see old friends, go to the theatre, etc. but overall it has been a very good decision.
I’m moving back to California from Chicago after two years away. The California job is better (but pays less). I don’t own, and I won’t even consider looking for two years. I’m hoping affordability returns a bit by that time.
You can’t come back to California. I have seen it 3 times where those who leave can not afford to move back.
If own free and clear or have a small mortgage, it is better to rent your California house, and rent at your new location. I have seen this work.
Sure they can come back. They can rent. A good friend of mine did just that.
I grew up in California, and have lived most of my adult life elsewhere, in the midwest, southeast, and now northeast. The cost of buying a house there is insane, but people need to keep in mind that California is a very special place, and even as it gets more and more overcrowded, it has a long way to go before it is anything other than a very special place. If you move anywhere else in the country, there are things you will miss, I assure you, and you may end up longing to go back.
Watch out for the greener grass on the other side of the fence. If you want to cash out on your inflated CA real estate, consider renting.
but people need to keep in mind that California is a very special place, and even as it gets more and more overcrowded, it has a long way to go before it is anything other than a very special place.
I take it your being sarcastic/ironic here?
If you move anywhere else in the country, there are things you will miss, I assure you
Yes… like the perpetually unaffordable housing, and being surrounded by 10 million uninvited “guest” workers (who btw, don’t mind living 20 to a room and working for 1/10th your salary). Oh, but these “guests” DO want your hard-earned “free” tax money, in the form of free healthcare, Section 8 housing, welfare/AFDC & free education for the “little ones”, etc. Then there’s the lovely urban blight and gang-infested ghettos as far as the eye can see. Don’t forget the perma-gridlock, “heroic” commutes and crowds everywhere you go, regardless of time of day. In L.A., we also
get that “special” quasi-permanent inversion layer trapping in all that smog for six months out of the year, plus the added bonus of 100+ degree summers.
Hell, I’m getting all misty just thinking about it.
We spent two weeks in California last year and agree it’s a special place. SF and Marin were amazing as was the coastal highway drive down to San Simeon, which we found a turn off because of Hearst’s piggishness. The Sierras’ were breathtaking as was Malibu Beach. We’d been there before and will surely return on vacations, perhaps the occasional two month winter vacation in Feb & Mar to help shorten the Maine winter when we retire.
But we found the real estate prices shockingly high. We could never afford to live there. Here we’re on a golf course, have 4,000 sq ft on 1.5 acres, are 10 minutes from Portland and only 20 minutes from crystal clear Sebago Lake. We’re only four miles from the ocean. This house would cost three if not four times as much in a similar top school district in coastal California.
I was amazed at how many people there are in California these days. We were on some freeways out near Bakersfield in the middle of nowhere and the traffic, although moving at 70mph was way too thick for us. It wasn’t safe to be driving that fast with that many cars all around you. The crowds in the state parks and national parks were also too much for us. Here we walk in the woods and often see not a soul. In California it was so many nonstop hikers, in places you didn’t even say hello to them - it would not have been practical. I was also amazed at how diverse California had become. Maine is lily white and everyone speaks English. California was like being in a different world. Having grown up in a white NY neighborhood that became 90% Hispanic and finally leaving as a stranger in my own neighborhood, I’m not sure I’d be comfortable with that many people not speaking English, knowing their population percentages will almost certainly increase. Getting booted from a neighborhood once was one time too many.
Finally, we hit 107 degree heat in the interior sections and getting out of the car was like stepping into a blast furnace. That would be too much for us, just as I’m sure some wouldn’t like our winters here.
The Bay Area has everything. Everything. Southern California has most things, but the Bay Area has everything. Except snow and frigid winter. But everything else. If you can name it, it’s here.
And if we don’t have it, it’s a 3-4 hour drive away.
Oh wait, the schools in San Francisco at least are mostly pretty crappy. Good thing I didn’t grow up here. But I don’t have kids, not yet.
But whenever I go anywhere else, I really look forward to coming back. Food is better here, the mountains are better, the coasts are great, you name it. So that’s why it costs a lot of money to live in California and always will. But even here I cannot see a disconnect from the fundamentals.
It will go down. And the more of you who go to red states, the faster the buyer pool will be exhausted.
The Bay Area has everything.
Everything but jobs that will in the long run support these prices. You see many who paid these hi prices , $1M for 1500 sq ft dont understand jobs are being shipped out.
Many still believe we will have another boom in the valley. Its often said “It will come back, it always has”…. Always i ask?
In Silicon valley its nothing new. Manufacturing jobs went in 1985-1991, now high cost R&D is being shipped out. There will be fewer and fewer high paying jobs in the future. No problem… lots of inventory…
The prices in the Bay Area are going to crash badly.
On some of the other things - I find the temperature in SF a bit too cool in the summer and get pretty tired of the fogs. The ocean water is ice cold and not swimmable and the lakes are very low quality compared to those in places like Minnesota and New England.Most of the trees are very scrubby and I prefer the lush forests that abound back east. The city is way too diverse for our tastes and there are just way too many people. It’s also no fun having to think about earthquakes and other natural disasters. And Poison Oak is everywhere.
It’s a wonderful place to visit, but I can think of many places in the U.S. that are much nicer to live in, northern Westchester county being one of them. But we’re expenisve too.
I have to agree with you Blissful. I got tired of LA after 17 years and moved to South Florida in 2004. After two years I missed California so much I recently moved to San Diego. With all its problems, California is a very special place.
Ok, I’ll concede the variety and quality of food here is world-class. I will miss having every kind of excellent international foods on tap. The Bay Area is at least relatively close to a lot of cool places (Napa, Yosemite, etc.), and significantly less crowded than SoCal, so, yeah, I prefer it too. However, no amount of good food, pretty scenery or vacation spots makes up for CA’s complete lack of affordability. Even rents here (though a relative bargain) are very high vs. incomes, and usually for some pretty small run-down apartment with few amenities.
Besides, there are other states with stunning natural beauty –Utah, Wyoming, Oregon & Washington come to mind– while the variety of food available elsewhere (particularly bigger cities) has been steadily improving. As a lifelong Californian, I have seen the overall Q.O.L. for the non-rich here decline dramatically in the last 30 years. Natives here are deluding themselves if they think CA’s “specialness” justifies a 200-300% premium in housing over anywhere else.
I’d move in a heartbeat if it wasn’t for family obligations. What good is nice weather and beautiful scenery when you constantly have to battle traffic to go anywhere? Where I live there are mid-day traffic jams! About the only time it’s not crowded is on Sunday mornings before 10 AM.
Not to mention the crowds every-frickin-where. I’ve trained myself to be a very early morning person just to get some peace.
Kaleidoscope Eyes,
Why do you hate Kalifornia? Haven’t you heard? Everyone here lives “Baywatch” carefree lifestyles filled with effortless wealth, beautiful people, and we all live within 5 minutes of the beach in multi-million-dollar McMansions that spawn money. The “guest workers” are your friends. Thay are here to build and maintain your McMansion, mow your lawns, tend to your children, prepare your food and then respectfully disappear after dark. The streets here are literally paved with gold. Don’t you understand?? CA is “special”.
I sold my house in Silicon Valley, CA in Oct ‘05. I specifically sold because I knew the bubble would burst, and my 1900 sq foot ranch house was worth $1.5M to someone. I loved my house, the neighborhood, my friends, and my garden especially, but I needed the money for retirement savings. By the way, it was obvious to me the bubble was going to burst for several years, the only question was when. I didn’t start reading Ben’s blog until earlier this year.
I do consulting mostly working at home so I could live anywhere. I chose to come to the midwest (Ozarks) because my brother had moved his business and very large family out here (from Anaheim/Lake Elsinore) 1 year earlier. They all love it in the midwest and it seemed like an opportunity to spend time with my brother, nieces & nephews, grandnieces and grandnephews. I am renting now, a very small place, and it’s not easy with 4 dogs and other pets. I missed an opportunity to buy a small older house in town, that would have been perfect for me, but I was paralyzed by thinking the housing bubble had permeated this area too (it has, but only a little bit). So far I like it here but I know that I would NOT be happy if I didn’t have 17 relatives (of all ages) living and working within a few miles of me. I have easily made new friends, most of whom are coastal transplants, some natives. But meeting the people is easier because my brother has a business right in town.
It’s hot here in the summer — 95 degrees today. When it was this hot in San Jose we would be swooning and whining. But we didn’t have the excellent air-conditioning that they have here. Also, the really humid days are later in the summer. And only a few tornados have passed by (within one mile) in the last year
In summary, it’s OK so far, but I didn’t have to get a real job, and I already had family here. I met a woman last night from MA who hugged me and said “please be my sister”! She lives in a beautiful new house on 5 acres just a mile from town, and she feels isolated. (Her husband recently retired young, they also have small children.)
Where I lived in CA was really paradise, but there was an underlying pressure to be a huge business success and make a ton of money. Since I had LOST a ton of money (in start-ups and the stock market) I felt rather out of place.
We moved to Austin and love it. We left Phoenix, sold our house as the market was on the rise last year. No regrets. Same mortgage as we had in Phoenix but for a home that would have cost us double (before the bubble rise and triple since). We have taken the year off and don’t plan on going back to work until 2007 so we have been checking out as much of Texas as we can. There are lots of places with very low cost housing but can’t say those small towns appeal to me. We were in San Angelo Friday, about 3 1/2 hours west of Austin, town of 100,000. Homes were expensive in relation to incomes there if you wanted new (still only $85-100 a sq ft) but if you looked in the old parts of town (which I’d prefer as they have a lot of great homes from the 20s up to the 60s there) you could buy a 1900 sq ft tudor for $110,000 or a fixer for $85,000. Also was surprised at the number of homes that were for sale and empty. The thing is you got to have a lot of cash as the average household income is only $33,000 there (unless you are a professional or government worker). So it looks like a lot of people go there and buy cause it looks cheap but if you don’t have a good job even a $80,000 house is expensive. (Thank you Republicans and Democrats for not increasing the minimum wage to reflect ten years of inflation).
Arizona is still a California “mini-me”–high prices even in the most remote counties and low wages due to undocumented workers. Have fallen out of the stick-and-frame market into the trailer park. It’s a cheap, family oriented place to ride out the Arizona bubble. Lots more houses listed than ever before–some trading up with ever expanding new communities, but lots also mailing in the housekeys on the way out of state. Haven’t seen the housing market this unsteady since the Resolution Trust land bust of the late 1980’s.
Here it is in a nutshell. After living in San Diego for 30 years we moved to the Olympic Peninsula. No regrets here, by the way.
But, I grew up in Michigan so here’s the scoop. Wonderful place to raise a family if you can handle the weather. The Midwest can be very cold in the winter and hot and humid in the summer. Beautiful beaches, though. Much, much prettier than Southern California, and no June gloom. I missed them every year…..
ummm - i just watched Dr. 90210 for the first time - just ended 5 minutes ago - i am sure it is a misrepresentation of what really happens in Cali (i can attest for the smog & traffic, having been there a few times) - but if not - it has every aspect of the bubble blog going for it - woman in her 30’s - pretty hot - fake boobs, nice bod - but thinks she is “just this chin” away from stardom, getting plastic surgery to augment her “weak” chin - SHE IS IN HER 30’s AND THINKS SHE IS A CHIN AWAY FROM “STARDOM” - are you f’n kidding me? - you are TOAST - you will never make it - there are ten thousand naturally better looking, younger, more talented people than you trying to make it! - anyway - the plastic surgeon is fanning her dreams - “let me raise this eyebrow a little too, it’s droop is taking away from what the top models have” - why is he fanning this fantasy???? HIS wife wants “just one more bedroom, just one more bathroom” - their 3000 Sq. ft. house is too small (of course the focus is also on how he spends all day cleaning it and they have no time to spend together - hmmm….4000 sq. will take care of that problem!)
Episode ends with chin job and her husband “celebrating” their “impending” “academy award winning” movie gig (speculating of course, no concrete auditions or anything yet, not even for a pet food commercial… how pathetic???!!!) And the doctor’s wife signing the papers on the new $3-4 million house and telling her mother how they “have to sell their house now, after all, we need the money from the old house to buy the new one” The final scene is the doctor, looking a bit pertubed and saying ” the monthly mortgage payments on my new house equals my yearly income” - I wouldn’t be surprised if it was true! Sheesh - I thought us new yorkers were clueless, no wonder everyone is leaving Cali!
ugh…thanks for reminding me why I gave up cable!
10,000? Try 100,000, at least, and that’s just the ones that live there full time. Even more come to stay during pilot season. To top it off, it’s a dying industry. Younger generations prefer the internet and video games to TV and movies. Film stars have less clout and more competition than at any time in history. I hope the currently successful ones are saving their earnings and not investing it all in CA RE.
GREED =’s Income divided by foolishness times the propensity to fool potential buyers of your over inflated property. Soon a majority of new home buyers will be the foolish lenders to those sellers and these new debtors will spend years paying off this foolishness. Just look at some of the Student Loans that have been taken out that must be sevrviced until they are paid off. All of this reduces the net disposable income people have for other consumption. OUR ECONOMY in the areas of these insane bubbles will cause the standard of living to go down. It’s a fact. We need to get back to reality and this high housing nonsense is not the way. GOOD LUCK to all of those whow over pay and become net lenders….
The specialness of CA is long gone. What good are nice beaches, etc when you are working around the clock? I left for ABQ which is better for my family. There are many more activities for the children, more children for her to play with, have a house instead of tiny apartment. Also, much less crowded and everything we need for work, shopping, entertainment, etc within the city is no more than a 15 minute drive. So it works out much better for us. Our child doens’t even miss CA at all. She is much happier here.