California NIMBYism getting a populist smackdown: Senate Bill 50 supporting removal of single-family zoning gets first sign off. 
People didn’t want to believe it but we are now shifting to a rental nation. California is now a renter’s paradise and the idea that baby boomers who purchased property “back in the day†were going to stay in inflated properties while Millennials run around voting to protect said inflated properties never made sense. Interestingly enough many of these Millennial “kids†now live at home with their parents in California enjoying those inflated real estate values. Yet the political winds are shifting. A Senate Bill just saw the light of day in which single-family zoning may get removed for higher density housing. So just imagine your already crowded California street seeing double or triple the traffic (you probably already see some of this with adult “kids†living at home and adding more cars to the street). Yet this was all foreseeable as a younger generation is priced out of the housing market.
NIMBYism is unsupportable
California has been living in a NIMBYism fantasy. People have been operating in a “I got mine†so forget about you world and guess what? The sentiment is now shifting politically. The entire political shift we are seeing right now is largely due to this economic compression of the middle class. On one end of the spectrum you have a billionaire real estate mogul President that seems to cater to the temporarily embarrassed millionaire syndrome of many and on the other end you have candidates that seem to be offering free everything to a younger population that is frustrated with the status quo. It is a polarizing time so it is no surprise that old antiquated systems like single family zoning or even Prop 13 will face challenges when the majority of your population rents and has access to the internet.
The most populated county in the United States, Los Angeles with over 10 million people is now a renting majority county:
So of course the times are changing:
“(LA Times) Still — let’s just pause on the fact that a bipartisan group of lawmakers voted in favor of a bill that would allow apartments pretty much anywhere in California.
Again, this would be a major change from the status quo. Wiener has said that it’s illegal to build more than a single-family house (plus an in-law unit) in roughly 80% of California’s residential neighborhoods.â€
Keep in mind the status quo in the previous election. Just look at all the polls before the election. People that think Prop 13 or NIMBYism is going to stay are simply not paying attention. Things are changing. Simply having asset bubbles running rampant to support a financial apparatus is going to cause some economic disruption. I’ve seen a few VC pitches and we are back to LaLa Land in terms of valuations and running out of ideas as to where to put money.
Property values have also hit a stagnation point this past year and for a model built for continual price increases, this is not going to look good for the real estate machinery that is built on annual price gains. It doesn’t sound good when you say “year-over-year prices are down†and you are carrying a massive mortgage with Principal, Interest, Taxes, and Insurance weighing you all down (plus the new tax laws do punish states like California and New York with inflated asset classes).
The fact that Senate Bill 50 has gotten this far is stunning. It is simply a sign of the times. And we are now in a 10 year bull run. Corrections are simply a part of the business cycle. Now do you think when that correction hits we are going to see more homeowners?
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144 Responses to “California NIMBYism getting a populist smackdown: Senate Bill 50 supporting removal of single-family zoning gets first sign off. ”
This is the market take it or leave it. There won’t be a correction in the next 5 years. This can go on for a long time stagnating at best.
Agreed. Today’s NYT times shows another 260,000 added jobs and wages slowly starting to rise again. The RE bears are jumping up and down over slight fluctuations in home prices which are just background noise in market with no black swan in sight. And we all know trump will juice the market every which way to sunday to prevent a crash.
QE,
Obviously, you must be new to the housing market and how it works. RE cheerleaders were telling us the economy is strong and that translates into high demand and no supply. Price reductions cannot happen.
Well, everything that was not supposed to happen actually happened. RE cheerleaders were screaming hard that inventory is not going up. They don’t say this anymore. Sales numbers are declining. How is that possible if the economy is doing so well? How come YoY prices turned negative??? What? How can prices go down??
It’s because the housing market is like a cruise ship. Once it sets a course it stays there for a while (trend and ten year cycle). We hit an inflection point last year and are going slow and steady down. Add to that a recession and the ship starts moving faster. Once panic hits the market the fun starts. Hope this helped. Let me know if you have any questions.
I love how condescending the millenials are. They don’t have the most fundamentally basic investment any beginning investor could laughably have, yet they are condescending in their tone that *you* are new to the game. It’s kinda cute how ignorant they are and don’t realize
Welcome to the blog SomeSome!
Millennials seem more savvy than some previous generations when it comes to buying homes. Millennials understand that it’s NOT always a good time to buy. Older generations bought sky high and foreclosed later. We learned from that: How to not buy homes that Are highly inflated and only benefit the seller, lender and realtor. It’s very irresponsible to live a lifestyle you can’t afford and then simply file for bankruptcy later. Someone else will pay for it, right?
What millennials do well:
Live with your parents to save money
Don’t buy high and make boomers, realtors and lenders rich
Hope for a crash and invest when prices are more realistic (50-70% down)
Don’t believe anything RE cheerleaders say. Do your own research and the opposite of what the shills say
What RE cheerleaders don’t do well:
Being brainwashed. They can’t understand that it’s not always a good time to buy. It’s like a mental disease. No chart, argument or rental parity spreadsheet will help. No set of data or research paper makes a difference. It’s all about: buy now, don’t wait. Buy now.
Even if you tell them, rents are so dirt cheap compared to buying. Why should I buy? They will tell you , “your rent is highâ€. See the problem here? How do you argue with the mentally challenged?
SomeSome: A $1M house is not a “fundamentally basic investment”. Millenials (and some of us late Gen X’ers are waiting for a buying opportunity and don’t feel comfortable buying in the current real estate environment. Did you forget about 2005/2006 already? No way in hell I’m buying now when I can rent for almost half the price. Also, don’t assume we are some poor indigent losers without a clue. Many of us have a decent financial arsenal (rental property, 401Ks, other miscellaneous investments, etc.).
I’m a baby-boomer but got to go with Millenial on this. There will be a significant drop.
* despite QE and the fed pumping markets in the end its an equation that comprises income, home price and interest rates. Median priced houses are NOT affordable to 70% of the countries households. Affordability ALWAYS reverts to the mean. The only thing stopping this would be rising incomes https://3.bp.blogspot.com/-ISrsHUvhZMs/WpgCDebtdSI/AAAAAAAAQTQ/L5lEhJa3PW8yKqmcS4_ykHQK0WWms5AogCLcBGAs/s1600/median-household-income-in-21st-century-nominal-and-real-estimates-200001-thru-201801.png not happening or mortgage rates going down. Even when rates are going down the real estate market can also go down http://wolfstreet.com/wp-content/uploads/2013/09/US-mortgage-rates-v-home-prices-1985_2013.png
I never said that I disagreed with what you’re saying about the market going down. I’m just saying that considering you’ve missed out on the single most fundamentally basic investment vehicle and not to mention missed it at the greatest investment period in history, I don’t think it’s wise to be so condescending about it. You might be right about the future, but your track record leaves you zero credibility to be a jerk about it.
You mean “it’s different this time?”
2007 called, it want’s it’s high handed, false prediction on real estate valuations back.
I agree with New Age. The rest of you are extremists. There is no middle of the ground. Either you’re like Millennial, predicting that a doomsday style decline is definitively on the horizon or you’re like the RE Cheerleaders that he bashes, who think prices will continue rising into the stratosphere. New Age comes at it from a more pragmatic approach. He accepts that homes are out of reach for many Americans, the product of years of policy that shifted wealth from the middle class to the elite. There was indeed a paradigm shift in 2009 with respect to monetary policy–we see massive budget deficits, near zero percent interest rates, and quantitative easing. The old me would have been like the rest of the contrarians, predicting hyperinflation and doom, but alas–it hasn’t been inflationary. Why not? How is this possible? I thought printing money was supposed to be inflationary. I also thought a recession was supposed to happen every few years, but what if we don’t have a recession for many more years to come. I mean there are examples all over the world, namely Australia, which hasn’t had a recession in 28 years. We treat recessions like things that MUST happen, but what happens if it takes much longer for that recession to hit? Also, what happens if inflation does rear its ugly head. Nobody has been talking about inflation lately, but what happens to individuals like Millennial who have all of their assets parked in highly liquid investments? What happens to interest rates and what happens to asset values?
KMillie,
I am in no way an extremist. I’m a pragmatist and a student of history. Long term real estate is profitable. Long term renting isn’t. It’s been true for the past 100+ years.
Will there be blips along the way? Will there be times when renting makes more sense than buying short term? Absolutely. But waiting 10 years for the right buying opportunity and mirage 75% fire sales, is financial suicide.
I’ve made this analogy before with Millie. He’s putting on 10 lbs a year for 10 years. Then in year 11 he drops 20lbs and then pats himself on the back for losing a lot of weight. Meanwhile homeowners put on 20lbs, in year 11 after having stayed the same weight for the previous 10 years. So you tell me, who has better weight management in that scenario?
Exact same thing with buying vs renting. Prices double then fall 10-20%. Are you better off buying at the beginning or the end of the cycle? The answer is obvious.
As a landlord I wish no millennial ever buys a home. The more of them there are in the rental pool, the more rent I charge for my properties.
It seems you skipped the college education. One of the first things I learned in college was about economic cycles. To say that there might not be a recession anymore or not for a very long time is like saying, i don’t think it’s going to rain anymore. A recession is healthy and part of the economic cycle. So many RE cheerleaders believe that when you say the R word you are some sort of doomsdayer. Take me for instance. I am actually the opposite. I am a REAL estate bull long term.
Short-term/mid-term the housing market is going down hard. Everybody who understands basics about the housing market can see that. There is a clear trend here, inventory continues to push higher, sales numbers are declining and prices in some areas are already negative YoY. The trend is your friend (until it’s not).
Also, the housing market moves like a cruise ship. Once it has set course, it remains on that path for a while – slow and steady. There are actually very rarely any doomsdayer on this blog. You have the ones that share their expertise (like me) and on the other side you have people trying hard to get people to buy now at the worst time in history (RE cheerleaders).
@KMillie
Thank you for your insight, I try to approach this topic with a very level head, free of as much bias as I possibly can. I am a millennial myself and I WISH I was wrong but facing the reality and strategizing accordingly is better than lying to yourself.
@Mr. Landlord
Great analogy. That exactly what I’ve been trying to say to our friend Millennial but he just doesn’t seem to get it. He keeps mentioning “rental parity” as his strongest argument not realizing that the RE market is a short term loss (duh) but a long term gain which is worthy enough to keep people buying at sustainable levels. He also keeps mentioning 2006-2009 boom/bust as if the economy just magically operates like a car that has to be taken in every 10K miles for maintenance. He keeps mentioning his research about 100+ years of experience of the RE market but completely ignores the broader history of eras with multiple generations of elitist control of RE when wealth becomes polarized as it has been in the last decade. His research is based the US RE market not realizing the US is on this planet called Earth and shares this space with other countries that have leading indicators of what the RE market will become because how globalized we’ve become in the last decade. All of these factors are literally sitting on his lap and crying in his face and he just seems to keep on eating his avocado toast as if he’s ten minutes early to a party that will never happen. Never mind the technology factor like AirBNB that will forever cement prices in desirable tourist areas and justify a hefty ROI on what he perceives to be “inflated”.
@Millie
“My teacher said…” is never a good argument for anything. Look at the factors at play and come to the realization that you won’t get what you wishfully want. You’ve been on this blog for YEARS and if you bought when you first posted I guarantee you would’ve already been recession-proof by now. Now that the market is slowing down you’re sitting here feeling good about yourself but in reality you’re dead wrong man. Like I said I will gladly eat my words up but I’ve learned that what I WANT to happen and what WILL happen are completely different. This is clouding your judgement and you can’t be a good investor if you can even see 3 feet ahead of you.
Millie my good man,
I didn’t say there will be no recessions. I said there will be blips along the way, ie recessions. But you have been waiting for a mythical 75% crash for a decade. In that decade prices have doubled, and even tripled in some areas. Your recession will bring those prices back maybe 10%, 20% if you’re lucky. So you lose out on 100% and oat yourself on the back for the 20% gain. LOL. Hey man whatever works for you.
It’s interesting how desperate our RE cheerleaders have become. They know a 50-70% correction is coming and fired everything they had in their arsenal. It appears they ran out of arguments….so their last words are “you are wrong?†Let’s recap what we heard from our RE cheerleaders over the last year alone:
“This will be the year when millennials go out and buy in droves†we are still waiting and hear this every year
“There is no inventory. The economy os strong†finally we don’t hear that anymore and everybody including the neighbors cat know the inventory is increasing sharply YoY
“This spring selling season will be epic / red hot†nope. Just like last year we see price drops across the board.
“Prices will not come down. The economy is strong†yep, the economy is strong. So why haven’t you set up a search on Zillow or Redfin. Both websites are bombarding me with price drops daily.
“You wait until prices double and then buy when prices are down 25%†not sure where this nonsense comes from. 25% drop isn’t enough to get me off the couch. Everyone with internet access can easily see the last crash shows millions of examples where prices dropped 50%.
“You are wrong†you can’t lose by winning. It’s like telling a team who won the championship. Sry guys you lost! How do you argue with this? Are RE cheerleadersmreally that desperate now?
Another note: notice how RE cheerleaders hate the rental parity discussion. They still haven’t found one reason why someone should buy sky high while having the opportunity to rent for half the cost. We are still waiting 🙂
Here is what a RE cheerleader will mentions: data. Or have you heard from one of them that prices are negative already YoY or that we continue to have negative sales?
The issue with RE shills is they can’t look at the market in a neutral way. Everything is targeted to twist your words, lie and find unrealistic scenarios that make buying at the top appear to be the right choice. Everyone who’s knows basic math and has taken the time to research knows right now is the worst time in history to buy. Therefore, this blog is so entertaining. Think about it, if buying would make any sense financially we wouldn’t need these RE shills working so hard to convince the last sucker. Right? We would have already bought!
Seen It All Before, it’s different this time.
Bob, “did not see anything before”, will love this. I would love to see his reaction to his beloved communist politicians when his property taxes will triple and can’t use his car because the traffic will be at stand still. Eventually the politicians will make the use of personal car prohibitively expensive for 99% to encourage public transportation. Every trip everywhere will take hours because he has to wait at bus stations and travel everywhere with a bus full of smelly homeless from the hood (who receive free passes from their beloved communists like AOC), to go to a state paid “doctor” where he waits half a day at the door for a 2 min. visit (the line is long outside), with no medicine (because the government run out of funds, hey at least he will no what his problem is:-)); but he will get his wish, better than life under the Tsar – he will live under communism, masquerading as capitalism. Rent will be “free”, food will be “free”, education will be “free”, transportation will be “free”, medical assistance will be “free” and money for all under MMT – finally he will be living in his Nirvana. Oh and I forgot he will get his wish of $1000/hour minimum wage; after all who can buy a loaf of bread for less than $8,000?! He will continue to be the forever “compassionate” Bob.
Too funny, Flyover. Growing up, we all heard about the long lines waiting for everything and anything in communist Russia. It turns out that the government set things up that way on purpose. If you’re spending hours of your day waiting in line for your bread and your cheese, you’re not going to have time to revolt against the government. Gotta make sure your family is fed first.
Flyover, what country did you grow up in? I’m guessing Eastern Block.
Yes, born and raised in the Eastern Block. What country is irrelevant. They all suffered the same because it doesn’t matter where socialism is implemented, it is an equal share of misery. Even today, after many decades I am glad I’ve got out of there.
What Mili said about the mentality of many (not all) in those countries is true. However, those who could not stand that ideology from the pit of hell (praised on this forum by Bob every week) left those lands. Those who came to US think exactly the opposite. We don’t have only theoretical knowledge, we have first hand experience in what socialism is – EQUAL share of misery with NO opportunity to escape it. If the bolsheviks like Bernie and AOC get the power, I don’t know where else to flee. Maybe Switzerland would do. The rest of Europe under EU regime looks more and more like the old Soviet Union. It doesn’t matter where I went to Europe recently, it is no longer what it used to be, except Switzerland. Even Australia and New Zealand, which used to be nice, got more and more under bolshevik ideology of totalitarianism. I don’t think that today they have more freedom than my former country.
We live in a sad world. Let’s hope that the gradual process of taking away freedom in US will be reversed. Looking at the new generation and their political preferences, not too much hope though.
These economic/social ideologies go in cycles like anything else. If you press hard on one area of the economy and social views your going to reinforce other areas of the spectrum to rise up and shift it away. I would like to think that we could live this way forever without socialism or any other ideology that we oppose. However, we will likely go through it again and probably where we thought we would never see it. It will take some generations to move the rift toward another point of view, which appears to happening. Question is how far along are we in this cycle?
Thank you, Flyover. You have a way of looking at things that made me guess Eastern block. You’re realistic, and you think for yourself. My family is from East Germany, but my mother, her mom, and her three sisters got out before the wall went up. I never visited my East German relatives, but my sister did, and she said it was a miserable place to live.
Growing up, I was always grateful for living in the West. I knew that if I’d grown up under Hitler or Stalin or Mao, I would not have survived beyond my teens, as I am very outspoken about corruption. But now, like you, I am facing down the growing monster of communism, with nowhere else to go. As for Switzerland, there are drawbacks. The weather is cold, it’s extremely expensive, and the Swiss are some of the most uptight people I’ve ever met. Also, they closed their doors to new citizenship many years ago, right before the Middle East/African invasion, so it’s not easy to get permanent residency there anymore. I assume they knew what was coming. On the bright side, they not only let you, but they mandate that you have guns.
I agree with you about the rest of Europe, New Zealand, and Australia. A lot of the elite are building underground bunkers in New Zealand in particular, along with landing strips for their planes should they have to escape from somewhere. Many of them apparently listen to Alex Jones of infowars, as he has a handle on the bigger picture. A few weeks ago, he sent a message to them that if they think they’ll be safe there, they’d better think again. He said that their security personnel and the workers putting in the bunkers absolutely hate them, and that the bunkers will not be their homes, but their future tombs. Reminds me of Romania when their security forces turned on CeauÈ™escu. That was a shining moment of freedom.
CA population growth has stopped. L.A. county population took a dip. This is good. Less students in school should translate to smaller class rooms and closing old schools. The days of CA growth in population is over. More people mean more green house gases. Implement UN Agenda 21. NPG for all.
Sooner than later, the economy will take a dip and then there will not be so many jobs which is good, less vehicles on the freeway so I can travel faster. Remember, NPG is good.
Accurate summary: it’s a false dialectic to choose between Hypocrisy conservatism bereft of morality versus Marxist identity politics victimhood wierdos with 64 genders. But hey, that’s where we’re at. Or you can opt out and use that passport while the empire still stands.
Amen to that. People are so damn polarized, and it’ll take a while before sanity and unity returns. Fear-driven loyalty to one side breeds extremism.
Does this include the neighborhood of Newsom and Pelosi?
No. These guys tried, though:
Laura Loomer & illegal immigrants crash Nancy Pelosi’s California estate
https://www.rt.com/usa/448814-laura-loomer-pelosi-protest/
They were headed to Newsom’s house in SF after the Napa police escorted them off of Pelosi’s place.
Laura Loomer was just recently banned from Facebook, together with Louis Farrakhan, Alex Jones, and Milo Yiannapoulos: https://boingboing.net/2019/05/02/dangerdanger.html
Pelosi should pulled down the walls around her compound. She told Trump that walls are IMORAL Maybe she should show the rest of her electorate that she means what she said – hypocrite. She wants the walls down ONLY for other people not for her – typical communist with identical mentality.
Flyover,
The top 1% will pull down their walls when Trump pulls down the walls of Mar Lago.
It will never happen. Trump will never do it. Yet you call Pelosi a despot? Why not also call our current President a despot?
I do believe in controlled immigration and also don’t like Pelosi for her politics. Most of the illegal immigration will not be stopped by a trillion dollar wall (Though Trump cronies will make out Yuugely on those contracts.) Reminds me of communism corruption yet you somehow endorse it. We need more boots on the ground to bust and fine heavily those Trump corny businesses who are hiring illegal immigrants. BTW, Trump should be fined heavily for all of the illegal immigrants he has been hiring to staff his hotels.
You people are so weird.
I grew up in a very liberal town that was anti-development.
It was the Republican landowner/developer dream to take a small lot and sub-divide into 20 high priced rentals.
Good thing local compassionate Democrats were in charge and prevented this from happening.
Who made out with this rule? The landowners and the developers. Who are they typically? Republicans.
Republicans should be rejoicing with this law. No restrictions on subdividing, no restrictions on rent or sale price.
It almost make me want to be a Republican like Flyover and subdivide my 5 acre lot into 500 units and charge 1K per month(cheap). I’d rent to Our Millennial to lower his rent.
For the math and critical thinking challenged like JamesJim. that is 500K per month month on a lot I paid 10K 25 years ago. JamesJim, that is $6M per year I can collect from Trumplings. like you. MAGA (for me)!
Good thing I am compasssionate and will never rip off the village idiot Trumplings.
Most of the illegal immigration will not be stopped by a trillion dollar wall
It will if it’s built like Isael’s wall — which American taxpayers indirectly subsidized.
Tall, massive, with guard towers, and ground sensors.
Trump should keep demanding “an Israeli style wall.” That should be his mantra. It needs to go viral.
Then let the powers that be explain why it’s just for Israel, but immoral for the U.S., to have such a wall.
The “trillion dollar” wall will pay for itself, through savings on welfare, food stamps, fewer prison inmates, cops, fire and other social services, free education from K through college, and emergency room visits for illegals. Among other savings.
Bob,
There is no logic in what you say.
First, Trump believes that if walls/fences are good for his compound, then they are good for the rest of the middle class in US which faces stiff competition from the immigration down south in a race to the bottom. He walks the talk, which means he is consistent.
Second, you say you don’t like Pelosi, but then proceed to defend her illogical and non consistent position. She said that walls/fence are IMMORAL. If they are IMMORAL, then she should lead by example and pull down her own walls on her own compound. She said that “diversity is our strength”. If she means what she said, then she should build some housing Section 8 around her compound (with the walls down) and enjoy what she promotes to others.
Third, you accuse the republicans for something they have zero control over. If you did not notice, Democrats have TOTAL (100%) control over the legislative agenda in Sacramento – Senate, House and Governor. With this total control, you still have the guts to accuse the republicans for legislation passed in Sacramento – typical liberal who NEVER takes responsibility for the mess they create. Based on your “logic”, Trump is at fault for what laws pass in Sacramento. You suffer of an acute TDS, like those journalists from MSM. The more you comment the more you expose yourself and sink deeper in the hole you dug.
In conclusion, you go to a ridiculous extent to defend the democratic liberal agenda from Sacramento, to the point of looking totally illogic for all with two functioning brain cells who read your “arguments”.
Flyover,
You’ve gone off the rails.
I have never in any post defended Pelosi or Communism. Why do you make stuff up?
It’s almost like listening to a Trump speech where Trumplings believe every word even though it is all made up.
My only question to you which you never answered (And have now launched into an irrational dishonest tirade) is: How did communists come into power in Russia and Cuba? How did the Great Democratic Socialist, FDR get elected for 16 years?
You never answer.
I suspect you know the truth and why Bernie will be elected in 2020 and why the House has been already taken over by Democratic Socialists.
There is still time to stop it but Trump does nothing for his “base”
Bob, I can not answer your question because a good answer means to post a book on this blog, which is not feasible and it is not the place. A brief answer would be full of holes for an endless debate. There is an “official” version written by the victors and there is an actual real history you don’t hear too often.
The reason is not that I don’t have an answer, it is the practicality of writing history books on a RE blog. I can tell you that much – it is not the Tsar politics that brought the bolsheviks in power. I read extensively on the subject and I don’t believe for a second that that was the real cause. I’ll stop here and leave this subject for history blogs.
To borrow your “logic” of cause and effect, Trump came to power because of 8 years of Obama, socialism (see Obamacare), and extreme social agenda – people pushed back and they said enough of that. I don’t believe that is the reason but that is a lazy observation without being based on what happens behind the scenes. You always have to dig deeper to find real answers. Your “logic” is based on jerk reaction.
Thank you, Flyover for your response!
Let me help you. You should write a book on your opinion but I can easily condense what I learned from history books.
I have read the books and the interviews with people who lived during the time of the Tsar, Batista, and Republican Hoover, and the reason for their downfall is that the majority of citizens could not pay the rent despite many jobs but extremely low wages. In many cases were dying of starvation due to government policies (at least in the US there were soup lines, The people of Russia and Cuba did not have this). My grandmother lived when Hoover was President and told me why his Republican government policies caused the majority of the US to vote for a Democratic Socialist. They were desperate. Russia and Cuba did not have a Democracy so they could not vote out their leaders. They voted in extremist commies with a revolution because that’s all they had. )
Look at the number of homeless today and look at the number of people who can barely pay rent today. Tell me why AOC was elected and why Bernie will be elected in 2020. I explained it above.
Your description of Obama is laughable. Didn’t the stock market and home prices rise exponentially under Obama? Is that a new Commie policy that you haven’t written about? You state ObamaCare is why Obama is Socialist. That is true, but the question is why have the Republicans after 2 years in control of both Congress and the Presidency not repealed it? They wasted our taxpayer money to vote 80 times to repeal it while Obama was President but now that they are in charge, they can’t repeal it? What???? IMHO, Republicans know they will be booted out of office much faster if they repeal ObamaCare. How do you explain this?
Trump policies are just a continuation of Obama policies. We still have Obamacare. We have more jobs just like under Hoover, but most of them don’t allow the great American People to pay the rent.
AOC was elected and Bernie will be next due to failed Trump policies.
Our only hope is if Our Millennial is correct and home and rents crash 70%. More people will be able to buy a house and pay the rent and won’t have to vote in Socialists to save them.
Anything the Democrats and cohort enabling Republicans do at this point is bad, worse, and horrific for the citizens and growing class of poor, the army of homeless, the drugs flowing into the country. California, oppressed by the Democrats and Employee unions for 50 years is rotting from within.
Absolutely love the news/article. Thanks dr housing bubble!
The future seems very bright! Love that sentiment is changing and we get slowly rid of nimbyism and hopefully prop13.
Build,build,build and repeal the prop13 scam. I gladly have more traffic if I get lower house prices in return. I also gladly would pay more property taxes as long as I get lower home prices and most importantly older generations finally pay their fair share. In Reality, once older generations start paying what millennials have to pay in property taxes we can easily reduce the rate. Right now, the tax burden is heavily on millennials. Once the younger people figure out what a big scam this is, it will change and we get to a fairer taxation.
Excited for more supply, fairer taxes and a crash in housing! Great stuff ahead!until then, live with your parents or in-laws and save, save, save!
Milli: In Reality, once older generations start paying what millennials have to pay in property taxes we can easily reduce the rate.
NOT. Eliminating Prop 13 will increase taxes for some, but reduce taxes for none.
Longtime homeowners paying more will mean more tax revenue. But more taxes from some never result in less taxes for others. Instead, the new taxes are spent on more entitlement programs, and raises for employees and politicians. It won’t lower taxes for anyone.
But you already know that. You don’t care about lowering your taxes. You only want to see others suffer as much as you do. You’re a troll,
In California it’s possible that someone lives in a multi million dollar home and pays less property taxes than a millennial buying a condo. That’s a scam. It needs to be changed. If the million dollar homeowner starts paying his fair share we can reduce the taxes for the millennial. Simple and fair. End the scam. Repeal prop13. We have given enough freebies to people who don’t need it.
We’ve been telling him this over and over again. It doesn’t register.
It’s true, removing Prop 13 won’t lower our taxes. We need to raise taxes on boomer owned properties, and then use those increased revenues to lower taxes for millenials.
Guys, if you are just concerned about how much you have to pay you actually love eliminating prop13. What will happen if you repeal it? Everybody finally pays the same (percentage wise). That will mean the dude who inherited a 3 million dollar home and only pays 5k in property taxes (because you inherit the taxes too) will finally pay over 30k in property taxes. Some of these dudes will sell because they finally pay their fair share and are not cool with it. The state will have a ton more tax revenue. House prices will go down as there will be a lot more supply. Millennials can buy homes that are cheaper. Cheaper homes=lower taxes. You can only win by making the property taxes equal to all. It’s really simple to understand but some here pretend they don’t get it because they profit from prop13 and don’t want to give up this freebie.
MillY~ How do you profit on taxes that you’re PAYING?
Easiest question I got all month.
>>>Eliminate the prop13 scam and I pay less for a house.
Detail: we keep many heirs in their million dollar crapshack because they inherited not only the house but also the prop13 taxes.
The scam: in California you can have people living in a multi million dollar home and pay less taxes than a millennial that just bought a tiny condo.
Also, if you have boomers finally pay their fair share in property taxes the state gets overwhelmed with property tax revenue. So eliminate prop13 and replace it with something like this: everyone pays only .5%.
No matter where we end up. Bottom line is: Everyone needs to pay a fair share. It can’t be that younger generations are burdened with 8-12 times more in property taxes than older people.
I know. It still doesn’t click, right? I will keep writing the same words but mix them up. What else do I have to do today? I already did my open house tour. Foot traffic is dead.
Milly, you are such a broken record. And you are so full of yourself for no reason. If you eliminate Prop 13, your taxes will not go down. Let me re-post a great reply to you from ‘son of a landlord’:
“Eliminating Prop 13 will increase taxes for some, but reduce taxes for none.
Longtime homeowners paying more will mean more tax revenue. But more taxes from some never result in less taxes for others. Instead, the new taxes are spent on more entitlement programs, and raises for employees and politicians. It won’t lower taxes for anyone.
But you already know that. You don’t care about lowering your taxes. You only want to see others suffer as much as you do. You’re a troll.”
It’s obvious that repealing prop13 is a big win for younger generation. Prop13 is the biggest scam in history and only benefits older generations that don’t need it. They’ve already gotten a tuition free college education and dirt cheap house prices. On top of that they don’t pay their fair share in property taxes. If you think that’s okay just talk to the wall 🙂
Repeal the scam and replace it with something that lowers the tax burden for younger generations. Also, what do people don’t get here: if someone gets a freebie in property taxes and lives in a million dollar home it makes a difference if that lucky guy has to pay his fair share all of a sudden. Chances are more people downsize. We keep many boomers in mansions because we don’t allow them to pay their fair share in property taxes. No wonder they don’t downsize. End the scam and more boomers will sell. More supply means more pressure on house prices. I know….you can say this all day long in different ways, some people will not get it. They are rather being ripped off or are actually the ones benefitting from this scam.
His taxes would go down because the price of the home he buys would be lower, because repealing prop 13 would tank the real estate market in CA.
“His taxes would go down because the price of the home he buys would be lower, because repealing prop 13 would tank the real estate market in CA.â€
That went right over their head. No way they got this. It will take a few more years of explaining the same thing in different ways until it clicks.
Milli wanting to end prop 13 is so shortsighted. Sure ending prop 13 might lead to lower home prices, but at what cost? 2006 peak homebuyers are Halfway done paying off at 30 year mortgage. Even if they overpaid… they are now paying more principal than interest…. now you want them to pay higher taxes forever with no limits? Also… I would think when you buy your unicorn 75% off beachside mansion…. you will be complaining when you are taxed into oblivion in 15-30 years when your house is paid off too.
Repealing Prop 13 is shortsighted for Millennials as well. I’m a Gen-X’er, and bought a condo in 2011 when prices were also cheaper. Yeah, I don’t pay as little in property taxes as someone that bought a house in the 70’s, but I also don’t pay what someone who bought recently is paying.
Once Millennials have owned property for about 10 years or so, they will wish they had something like Prop 13 to keep their taxes low.
Lol….check out what salary is needed to buy a home in California.
https://www.zerohedge.com/news/2019-04-29/mapped-salary-needed-buy-home-50-us-metro-areas
Now compare that to the median household income in those areas. Reminds me off “this is the year when millennials gonout and buy in droves†….NOT
It remains a wet dream of our RE cheerleaders that millennials will bite the bullet and buy at these highly inflated prices to keep the bubble going. Keep dreaming folks 🙂
You do understand that individuals can own more than one property right? So realistically 10% of people can be landlords to the other 90% and charge them as much rent as they like. So in other words, it’s not even relevant that RE isn’t affordable to most people. You keep weak using arguments to support your bubbler rhetoric and I can’t believe you’ve managed to convince yourself. You seem like a smart guy, I expect better out of you.
“Charge as much rent as they like?” Lol! More like how much the renters can afford and are willing to pay.
Housing prices and rents have gone up for one reason and one reason only – inflationary money tactics by the Fed. That can only go on for so long before it becomes deflationary. Just ask Japan. You and your ilk are going to learn a very tough and humiliating lesson.
We totally understand your confusion. Let’s go step by step to make it simple for you.
My dad is a landlord. Owns several multi family buildings. Guess who is going to inherit this :)? That’s not my point though. My point is that he can’t charge the rent he wants. Now a silly billy like you doesn’t understand that so I will break down. If my dad charges above market rate he can’t find renters because the guy next door has to fill his vacant doors and offers a lower rent. It’s called supply and demand. Rents depend on income. I know. That’s news to you but once you get that you understand incomes matter. That’s one of the reasons RE cheerleaders try so hard to get millennials to buy homes. Demand has been muted all year and sales data looks teeeeeerrible. Keep telling yourself incomes don’t matter and affordability doesn’t matter. We have heard it all before. Just like “this is the year millennials will go out and buy in drovesâ€. Now you also understand why I am desperately looking for a reason to buy but can’t find one. If your landlord is giving you a smoking deal and you save big time every paycheck, why in the world would you want to buy???
What will matter for sellers is if the rent can’t cover their expenses or if unemployment goes up. That’s when the fun begins. Wait and see.
“So realistically 10% of people can be landlords to the other 90% and charge them as much rent as they like.”
This is exactly the situation is the premiere cities of Europe like Rome, Paris, Berlin, etc. The wealthy families own 90% of the residential property and hand it down from generation to generation while the vast majority of people rent for their entire lives. The US is Europe’s bastard child and destined to follow in their footsteps.
Now RE cheerleaders are telling us that landlords can charge what ever they like for rents. Actual landlords like my dad who own multi family buildings must have not gotten the memo. Also, my landlord hasn’t gotten the memo either. Why would she give me a deal of less than 1400 for a 2 bedroom if she could charge 6000 for it? Stupid! She really needs some RE cheerleader friends. Somebody needs to send out a mass email: landlords: you are the 10%, you own it all, you may increase your rent by 5,000% (just like my LiteCoins (LTC) went up 5,000% in 2017).
https://www.paulcraigroberts.org/2019/05/01/the-american-collapse-accelerates/
What has been happening to the mansions?
Am thinking of buying a small trailer.
And this is with low unemployment and GDP gains. What’s this going to look like when the real crash happens? Yikes
Couldn’t leave a link to a Paulcraigroberts depicting collapse in CA and Seattle and NIMBYism fighting homeless hordes.
What has been happening to the mansions?
Am thinking of buying a small trailer.
After reviewing SB50, it appears that this will remove building zone restrictions and enable multi-family housing (apartments) to be built in residential neighborhoods which currently consist of SFH’s. One can assume that these proposed apartment buildings will be built in the more desirable neighborhoods with better school districts and more amenities, because that’s where the money is. Building low-income apartments in the ghetto is not a money-maker. This is a real gift to CA real estate developers and will do little to help affordability and/or homelessness in CA. Real estate developers are pushing this agenda bit-time. Regardless of whether or not this passes, it is inevitable that LA and similar large metros in CA will become a cities of renters.
100%
100% truth
Politicians pass these laws out of the generosity of their hearts and because it is good for the people. They do it for no other reason, especially in California which is a one-party Uni-Party state run by all insiders and rich people who are all liberal and only have the poor and downtrodden in mind at all times.
If they pass such a law, you can trust it will be for the betterment of the poor and not because unscrupulous developers can make more money that way or because they would have influenced the senate nor even written the very bill the senate is hoping to pass.
Even if some industry happens to benefit somewhat as a side effect of proposed legislation, it will be a purely happenstance occurrence and in no way indicates that the beneficiaries had anything to do with writing up the legislation and then handing it to the always loving caring politicians to rubber stamp into law.
It is like that with government involvement in the healthcare industry and should they take it over, even if the pharmaceuticals, insurance and other industries benefit from direct transfer payments, from taxpayer to general health fund to these companies, in monthly large sum deposits, again, that will be the result of loving caring politicians doing this for the betterment of the people and nothing at all to do with any of the beneficiary corporations actually writing up the legislation for the politicians to blindly pass, without reading it.
You should not be so cynical, especially of liberal run California, which by definition has a government full of love and wonder for all.
LOL.
Jackie, that’s the funniest post ever. Priceless.
Exactly! 🙂
I shall not often meddle with politics, because we have a political Editor who is already excellent and only needs to serve a term or two in the penitentiary to be perfect.
– Mark Twain
I have lived in five Western European countries, Costa Rica and New Zealand. All had “Single payer†healthcare, they were cheaper and more efficient than the horrible, overpriced American healthcare system. There is not one country in the world that wants to emulate our healthcare system. Our system is the laughing stock of the whole world. Every year thousands of Americans WITH insurance go bankrupt!
I have lived in five Western European countries, Costa Rica and New Zealand. All had “Single payer†healthcare, they were cheaper and more efficient than the horrible, overpriced American healthcare system. There is not one country in the world that wants to emulate our healthcare system. Our system is the laughing stock of the whole world. Every year thousands of Americans WITH insurance go bankrupt!
Don’t you worry, they will get Section 8 in there by forcing developers to put in “low income” (which is really NO income, aka Section 8 trash) housing mixed in with the luxury apartments. There will be some rule like for every 100 units built, 20 have to be set aside as “low income”.
The end goal isn’t affordable housing. The end goal is destroying vibrant neighborhoods and capitalism itself.
Mandating a few “low-income apartments” per a development, is like pissing in the wind.
What a moron. Reducing government imposed restrictions on how private landowners can develop their property is destroying capitalism?
100%!!
I agree with you below. This is a Republican landowner/developer bill.
I grew up in Santa Barbara. This is a landowner/developer dream to subdivide a SFH into multiple high priced rental units.
Again, there is no logic in what you say.
You accuse the republicans for something they have zero control over. If you did not notice, Democrats have TOTAL (100%) control over the legislative agenda in Sacramento – Senate, House and Governor. With this total control, you still have the guts to accuse the republicans for legislation passed in Sacramento – typical liberal who NEVER takes responsibility for the mess they create. Based on your “logic”, Trump is at fault for what laws pass in Sacramento. You suffer of an acute TDS, like those journalists from MSM. The more you comment the more you expose yourself and sink deeper in the hole you dug.
In conclusion, you go to a ridiculous extent to defend the democratic liberal agenda from Sacramento, to the point of looking totally illogic for all with two functioning brain cells who read your “arguments”.
Flyover,
I lived through this in the 1970’s (maybe before you were born).
The developer dream was to subdivide SFH lots into multiple rental units. They didn’t have to live there and deal with parking, traffic, and Prop 13 schools.
This bill was created by the Republican elite to make a fortune. It will likely not pass.
It reminds me of the Jarvis-Gann Prop13 in the 1970’s. Homeowners though it was a great financial idea just like this bill.
Wake up Bob! We are in 2019. Reagan is no longer governor. Nothing passes in Sacramento without being fully backed by Democrats; NOTHING! The Democrats have full (100%) responsibility for everything coming out of Sacramento. It is time to own it; I know that liberals never take responsibility for anything, but still, you should at least try in face of black and white evidence. You live now in the paradise you dreamed of all your life – a democrat/socialist state government with democrats fully in charge.
Wake up Bob! We are in 2019. Reagan is no longer governor. Nothing passes in Sacramento without being fully backed by Democrats; NOTHING! The Democrats have full (100%) responsibility for everything coming out of Sacramento. It is time to own it; I know that liberals never take responsibility for anything, but still, you should at least try in face of black and white evidence. You live now in the paradise you dreamed of all your life – a democrat/socialist state government with democrats fully in charge.
Who needs zoning? It is the Democrats that force zoning on us all. True Republican capitalism means you and your neighbor can do whatever they want with their properties. If your neighbor wants to build 50 new condos next to you with no parking and your other neighbor wants to open a toxic waste dump, it is their MAGA right to do it. 🙂
I live in La Jolla in San Diego and people here and in other beach communities are freaking out about this bill and SB 330 because it’s not just higher density; the bills also remove a city’s right to set it’s own height limits for buildings within 1/4 mile of public transportation (effectively all of La Jolla, Pacific Beach, Mission Beach, Ocean Beach, etc). La Jolla has had a 30-foot height limit for decades, and these bills are set to raise that to 50+ feet, effectively cutting off the views of a lot of rich people. Interesting times ahead!
San Diego Co Election Results:
Newsom: 56.86%
BWA HA HA HA HA.
Enjoy the socialism good and hard La Jolla. You voted for it.
It’s amazing how Democrats keep saying “vote for us and we will steal your money and give it to others”. And people keep voting for them. And then they’re shocked that Democrats….get this….take their money and give it to others.
But hey man Trump said a naughty word 20 years ago, so it’s all good right? You won’t mind having Section 8 neighbors next to your $5M beach home. After all, diversity is the greatest strength we have, or so I’ve been told a million times by upper middle class white liberals.
I’m going long on popcorn futures….this is going to be awesome to watch!
Well put, Mr. Landlord!
the bills also remove a city’s right to set it’s own height limits for buildings within 1/4 mile of public transportation
Santa Monica has long used zoning height limits as a source of revenue. The city has low height limits, but is always willing to negotiate a waiver, should the developer “compensate” the city for the “negative impact” of taller buildings.
This “compensation” is usually a combination of low-income units (in the new building) and “community benefits” (the developer give the city money for parks, bike lanes, community projects, etc.) and “mitigation fees” (the developer gives the city money for additional police, fire, or other city employees, or maybe subsidize parking structures, to “mitigate” the added impact of the density).
This bill will severely harm Santa Monica’s revenue-raising capabilities, at a time when the city is facing deficits due to high employee retirement benefits.
I say there are too many powerful, liberal politicians to allow this bill to pass, as is.
The beach houses with small lots will take a hit. But, those beach houses with huge lots will be worth a fortune. Owning a large lot by the beach within a 1/4 mile of public transportation is absolute gold. I am sitting here counting my millions … but I am keeping my fingers crossed. I am hoping SB50 passes. It seems too good to be true. Looks my strategy of collecting old beach houses on large lots was a massive winner.
It totally is a winner! SB50 = more supply of housing. More supply = pressure on house prices. Build more apartments like there is no tomorrow!
I love the bill! Yes, build, build, build!! More and higher!! More supply!!
If people think renting is the way think again All costs associated with home ownership are passed along to renters The only answer is lower prices. We need a huge correction for many millennials who are working medicore paying jobs. That’s a lot of change
Renting is a gift. Buying during a bubble is suicide. When it crashes 50-70% you buy. Easy
Incorrect statement since currently right now in many markets the cost of rentals is half that of home ownership.
Unfortunately, urban land markets complexity involves that site values are highly elastic to allowed density. It is a misapprehension that allowing denser development means that the existing site value will be split up over more housing units. Site values end up going up faster than housing supply. This is why the denser new development is on average in a city, the MORE expensive that city’s housing, NOT the more affordable it is! Housing consumers end up paying MORE, for the smaller housing than before!
A trend to improved affordability, in contrast, historically, has always correlated to sprawl, and houses and lots increasing in size. Land values are highly elastic in the opposite direction to the assumptions of planners and politicians who say density=affordability. I am not going by some fancy theory, I am going by observed reality. Someone needs to get a Nobel Prize in Economics by devising a correct theory. Actually an obscure Greek housing-policy advocate published one in 1985 but no-one paid any attention. Dimitris Emmanuel: “Urban Land Prices and Housing Distribution”.
LOL!
It will be fun watching $2M homes in LA surrounded by Section 8 apartments. Keep voting Democrat suckers!
This is so much fun…..price drops, price drops, price drops. All day long 🙂 love my email inbox!
SB50 is a lottery ticket for me. I have one old beach close property on a massive lot that, according to a map on the internet, falls into a zone where apartments would be allowed. Actually, this means I will be able to build at least 4 perhaps 6 ocean view condos in a prestigious location. A lottery ticket for me. I smell millions and millions and millions. For a change, I like the Democrats.
We are finally on the same page JT! Yes, build build build!!
Good luck with getting your multi unit approved by the Coastal Commission.
I’ve heard that San Marino forbids multi-unit housing. It’s an all SFH city.
This bill should change the character of San Marino, destroying what makes it so expensive.
Maybe the good people of San Marino will think twice before blindly voting “D” every election, in the future.
What am I saying? They will continue to vote “D” and then blame Trump and Christians in Alabama when their new Section 8 10 story apartment building gets completed.
You people are so weird.
I grew up in a very liberal town that was anti-development.
It was the Republican landowner/developer dream to take a small lot and sub-divide into 20 high priced rentals.
Good thing local compassionate Democrats were in charge and prevented this from happening.
Who would make out with this rule? The landowners and the developers. Who are they typically? Republicans.
Republicans should be rejoicing with this law. No restrictions on subdividing, no restrictions on rent or sale price.
It almost make me want to be a Republican like Flyover and subdivide my 5 acre lot into 500 units and charge 1K per month(cheap). I’d rent to Our Millennial to lower his rent.
For the math and critical thinking challenged like JamesJim. that is 500K per month month on a lot I paid 10K 25 years ago. JamesJim, that is $6M per year I can collect from Trumplings. like you. MAGA (for me)!
Good thing I am compassionate and will never rip off the village idiot Trumplings.
Just one more point. What do you think the value of my Crap shack $1M dollar house will grow to if I subdivide it and start making $6M per year on rent? A good rule of thumb is 3X income so if I decide not to rip off the village idiots, I could cash out for $18M and let someone else do it. Good thing I am compassionate.
Poor Millennials think housing prices will drop when the argument above shows they will likely increase dramatically. Rents may go down while all of the subdividing is happening, but that doesn’t guarantee rents will stay down.
“Poor Millennials think housing prices will drop“
Small correction. We don’t think that. we see that already. The economy is still considered strong, yet we get bombarded with price drops left and right. What happens when the recession hits? 🙂
Bob, you, like a typical democrat liberal are very “compassionate” with the money you steal from “trumplings”/producers. The democrats, like all communists are never compassionate with the money they produce and work for. They have to steal first to show their generosity and compassion – peanuts for plebes/deplorables (to buy votes) and the rest for themselves and their buddies.
I think on a bigger scale. Spanish flu or war like things. Will thin the herd and make stuff we complain about now seem down right stupid.
With min. wage going up rentals for the $2,000- for a 3/1 anywhere in Los Angeles county is hard to find.
I just rented one side of my dupex (3/1) and it rented in two weeks at $2050 in a B class area of Los Angeles County. I could not keep up with all the interest in this unit. The old tenant thought $1850 rent was too expensive. I’m glad they left 🙂
When I buy real estate (I only buy at deep discount) with great long term debt. I am able to “short” the dollar buy doing this. My grandma paid $8,000 for her house back in the day, and now that same house is worth $450,000
Inflation Inflation Inflation
I mean the money you have in your checking account is losing at a target rate 2% per year. Crazy…
“now that same house is worth $450,000“
Here is your mistake. Just because a silly person pays 450k for it doesn’t mean it’s really worth that much. Sure, you can say it’s worth what someone is willing to pay for it but that only goes so long until the bubble market reaches its end. Right now, we are getting swamped with price reduction emails daily. The RE market has turned but the avg joe doesn’t see it. Experts and people who follow the data see it very well. Once we hit the crash that same house will be selling for 50-70% less. And all of a sudden it’s only worth 200k ish.
In terms of parking money at 2-3%. You are not losing money by parking it and investing it once we hit the crash. If you invest it now in the stock market you risk losing half of it when the economy crashes. It’s really dumb and short term thinking to always chase the high yield. You need to factor in cycles and macro economic developments. Nothing goes up forever even though at times like today it seems that way. We had 7 Mio foreclosures last times. This time it might be 10 Mio because they think like you.
Even if SB50 passes, lawsuits will tie it up in court for years. Property owners of single family residences of local cities will tell their City councilmembers to prohibit rezoning and ignore the State or laws.
JT,
I think you have it backwards. High end homes in neighborhoods with small lots will make out better than those with bigger lots.
You’re looking for spend $2M for a home. Where will you buy? In a ‘hood with small lots, that are too small to turn into Section 8 apartments? Or in a ‘hood with large lots that most likely will turn into Section 8 slums?
I suppose a developer could buy several adjoining homes with small lots, but that will never be cost effective. And it would take a lot of effort to get several home owners to agree to sell. Unlikely to happen. Small lot ‘hoods will continue to be SFH ‘hoods and will become even more desirable. Meanwhile large lot homes will turn into rental ghettoes and people will run away from them, crashing property values.
Meanwhile this bill, of course, won’t affect Gavin Newsom or Nancy Pelosi’s neighborhood.
Until they load a bunch of homeless shelters into your neighborhood…LOL. Change the meaning of “There goes the neighborhood.”
https://www.dailymail.co.uk/news/article-6976291/Outcry-judge-signs-homeless-shelter-Manhattans-Billionaires-Row.html
mr landlord, if you have a lot that gets upzoned, and it is in a wealthy area, you hit the jackpot. The higher the zoning, the more the lot is worth. Better yet, according to SB50 impact maps, not that many properties in wealthy beach communities are getting upzoned. This looks good to me.
Agreed. This sb50 looks fantastic. We need more supply. Build like there is no tomorrow!
NIMBY’ism is alive and well in CA. Because of which, everybody and their mother will sue to prevent multi-family housing from being built in their neighborhood especially in the more desirable neighborhoods with good school districts. If SB50 comes to pass, it will get tied up in legal battles for years.
Judges in Cali and the 9th Circuit will allow this madness. Your only hope is SCOTUS overturning it. And with John Roberts moving to the left as he has in the past couple of years…don’t hold your breath on that happening.
I guess there is a silver lining in SB50. It could have been much worse. They could have made SFH illegal altogether.
Home of Genius: https://www.redfin.com/CA/Van-Nuys/14228-Delano-St-91401/home/4647113
$1,070,000 for a tear down in Van Nuys.
I know it’s listed for the land value. But is 7,499 in Van Nuys worth over a million dollars?
Son of a Landlord,
This is a very relevant post.
IMHO, it is not worth $1M as a SFH teardown.
However with the new law, you can tear it down and replace it with 50 high priced apartments that rent for $5K per month.
At $250K per month potential income, the value of this teardown is $10M.
Poor Millennials, they thought they had a chance at buying a house.
5k a month for an apartment. Are you high :)?
Maybe in 60 years. 🙂
First the market is going to tank hard though. Some experts say 50-70% drops are coming.
$5K a month? Sure. We had to move 4 years ago because our landlord was selling the house we were renting in order to buy a 4-plex that was much more profitable. We worked in Oakland, and looked in a 30-mile radius to the east (away from SF) for another place. Couldn’t find anything, and we looked for 3 months. Finally, I walked over to an apartment complex across the street from my office on Grand Avenue, near Lake Merritt, to see what they had. The price they quoted for a 1,000 SF 2bedroom/2bath apartment with not even a balcony was $5,300/month! And this did not include parking, which was an additional $150/month, and only for overnight parking, since they rented out the spaces during the day to workers in the area. There was no parking anywhere near the building, so if you were sick and had to stay home, good luck finding a parking spot.
That’s when we said f*ck this, and moved 60 miles away to Santa Rosa. We commuted 4-6 hours a day, and then gave up and retired.
So no, Milly, Bob is not high.
It’s hilarious. Every time you wonder if a person is nuts for paying that much in HOAs or rent, someone comes out the closet and states: “me, me, I was paying even moreâ€.
That’s great guys. My tech job pays well above 100k and my rent is below 1500 for 2b/2b while commuting 20min to work. Congrats on paying 5k on your apartment or on paying 1k in HOAs! Sucks to be you.
Millie, screw you. We currently live in a 3 BR/2 BA house with a nice yard, that is completely paid for (inherited). We pay $0 rent and $0 mortgage, and our property taxes are $500/year THANKS TO PROP 13. Our biggest expense is the utilities. For all of your gloating, top that.
Yup, To Dumb if Yah Seen It All Before and Still Dumb Enough to Not Recognize it Again.
A report from Kieth Jurow. “California was the epicenter of cash-out refinancing and HELOC madness during the wild bubble years. There is growing evidence that Californians have learned nothing from the collapse and are once again throwing caution to the wind. According to a leading mortgage broker in California with a widely-read weekly real estate column, it is quite common for non-bank lenders to offer a HELOC with a combined loan-to-value (CLTV) of 90% and an interest rate of roughly Prime + 1%.â€
“For a home-equity installment second mortgage loan, the non-bank lenders are quite willing to do a CLTV of 100% at a fixed rate of 10% and a term of 20 years. This leaves no cushion in case of a home price decline. The mortgage broker explained that borrowers are willing to take this kind of loan because they want the money now and don’t care about the interest rate.â€
“Since non-bank lenders don’t take deposits, they are forced to use lines of credit obtained from banks to provide funding for their loans. In a housing downturn or liquidity crunch, the banks could pull the line of credit and essentially put the non-banker lender — large or small — out of business.â€
“An article published a year ago explained that an office of one non-bank lender had a sign which read ‘If the customer does not buy from us, it’s your fault, not theirs … BE OBSESSED.’ The author went on to state that many of the clients of one non-bank lender have ‘no savings, poor credit, or low income – sometimes all three.’ That sounds much like the sub-prime borrower of a dozen years ago.’â€
http://housingbubble.blog/?p=1627
The increasing share of home mortgages and re-finances issued by non-bank lenders is a huge red flag, especially if they are once more lending at 100% LTV at such high interest rates.
Worse, they are funded by banks, which means that the deposit banks could once more be endangered in the event of another housing bust.
Home loans made by non-bank lenders were 48% of all home loans issued as of December, 2018 vs 19% in the market at the peak of the last bubble, in 2007.
https://www.redfin.com/CA/Los-Angeles/2332-Wellington-Rd-90016/home/6892135
Sold 812 K in 2018, now selling for 835K. Who would want to live right next to a freeway? Lung Cancer anyone?
That home is in a sketchy neighborhood with some of the worst schools LA has to offer, add to that the air and noise pollution from the freeway. Boggles my mind that someone would pay upwards of 800K to live there. (Check out the street view with all the garbage strewn around the sidewalk and the roaring 10 freeway in the background.)
812 to 835.
Hmm.
Granted, I was not a math major in college. But it seems to be like the price in 2019 is HIGHER than in 2018. Which is really weird because we’re supposedly in a housing crash right now.
LOL
And yes living that close to a freeway is stupid. Not just lung cancer, but all sorts of health issues can develop from the pollution. And not just exhaust fumes, but brake dust, tire particles, etc. From what I’ve read, you want to be at least 1000 feet away from any busy road. And depending on wind patterns, the effects of a freeway can be felt as far as 2500 feet away. In a city like LA, it’s hard to find any home that is more than 2500 feet away from a freeway. But you want to maximize that distance.
Landlord I love those posts from you! Pls keep it up.
Here the RE cheerleader mindset: you buy something for 812k and TRY to sell it for 835k….you are up 23k in just one year right? Not bad huh, says mr landlord. Can’t be a turning market here.
The others here look at this and say, okay, this is a flip according to the pictures and listing details. (See below). So you put a considerably amt of money in this plus have transaction cost and you think you made money here? It would have been better to just put your money into a zero interest checking account and you would be AHEAD of this genius flipper! hahahahahaahahahahaha
Listings says:
“Hollywood Glam on Oversized Lot in West Adams! Step through custom mahogany front door to 3BR/2BA of wide open kitchen, living and dining, feat. new wood floors, designer lighting + detail, and tongue + groove wood ceilings/beams throughout! Sunshine pours into renovated kitchen offering Carrara quartz counters, custom cabinetry, island, glass display cabs, all new stainless steel appliances and tons of storage. Large master suite boasts custom closet, all new glass sliders to rear yard, + sliding barn door to master BA featuring dual Carrara marble vanity w/ sparkling subway tile shower + new hardware. 2 oversized BRs + modern hall bath offer room to grow! New plumbing, tankless water heater, 200amp panel, new HVAC, new waste lines, extensive landscaping, 2 car garage w/ automatic opener, privacy fencing + new windows throughout. Plenty of room for gardening, entertaining + â€
Here’s the LA Times article:
https://www.latimes.com/local/lanow/la-me-ln-freeway-pollution-filters-20170709-story.html
Type in an address and find the distance from a property to the nearest freeway. This dump is ** 50 feet ** from the 10. From the article, the pollution 500 feet from a freeway is the most harmful – minimum safe distance is 1000 feet.
Well yeah… it’s not sold yet. It’s asking price!!
Anybody buying right now who is not offering 10-15% below asking is an IDIOT^2…as is an Idiot already for buying right now.
***multiple over asking offers within 3 days is OVER…
Well yeah… it’s not sold yet. It’s asking price!!
Anybody buying right now who is not offering 10-15% below asking is an IDIOT^2…as is an Idiot already for buying right now.
***multiple over asking offers within 3 days is OVER…
I once lived about 3 football fields from the 210 fwy and although there was not much noise due to buildings between me and the freeway, the soot was horrible. not only fine black dust everywhere but it is corrosive and quickly stains and deteriorates all that outdoor stuff – patio umbrellas, all outdoor fabrics, etc.
It last sold for 812K and now they asking 835K? Even with a low 3% RE commission, the seller is losing money. Not even counting any improvements.
Maybe they have a sign out front that is visible to the I10 traffic and are hoping all of the “exposure” will cause a bidding war.
“It last sold for 812K and now they asking 835K? Even with a low 3% RE commission, the seller is losing money. Not even counting any improvements.â€
Are you sure you got this right? According to our genius mr landlord buying at 812 and selling at 835 means we are in a full on bull market.
I think there is some error in the status. if you scroll down thru price history, it sold for $510K in Apr 2018. Then maybe it was listed but not sold for $812K. Then relisted again now for $835K. could be a clerical error OR the recent buyer at $812K is somehow desperate to relocate, etc.
High prices are a symptom of how much money is out there. We should be MORE shocked at demand (people with money) rather than sale price.
That house next to the freeway or add another 100k and buy this one:
http://www.wallawallarealestate.com/residential/2236Ridgeview/2236ridgeview.html
Do realtors even view their listings before writing the copy?
Here’s the listing:
GORGEOUS HOME IN LOS ANGELES AND WELCOME TO A BEAUTIFUL STORY HOME. THIS HOME IS BRIGHT AND WELCOMING/// ENJOY THE OPEN SPACES FOR ENTERTAINING YOUR GUEST INSIDE AND OUT. CLOSE TO SHOPPING CENTERS AND RESTAURANTS. COME AND SEE THIS LOVELY HOME.
And here’s said “GORGEOUS HOME”: https://www.redfin.com/CA/Los-Angeles/9409-Beach-St-90002/home/7301458
229,000 in Dec 2010,if this is representative of beautiful and bright and open spaces .Then in the coming correction it should sell for much less than 200K.
SB50 is not the only thorn coming in housing prices and further expansion of inventory. SLO county has approved the building of small mobile homes and permiting of such in the county .
The push will be for affordable homes and a change in zoning throughout Ca. gotta love the liberal influence, prices will come down drastically and affordable inventory will increase!
50%-70% is coming ,populist movement, AOC is representative of the thought process in NY ,Ca as well and throughout the US!!
Back to eat the rich one way or another , it may not be fair but it is coming ,look for the low income housing coming to your million $ neighborhood!!
To be fair, nobody who will buy that house speaks English well enough to realize that anything is wrong with the description.
Talk about rough neighborhoods. That listing should include a firearm in the closing costs. “Gorgeous”, is not the term I would use to describe that place.
Property History for 9409 Beach Street
Date Event & Source Price Appreciation
May 7, 2019
Listed (Active)
CRMLS #IV19106002 $390,000 —
Jul 19, 2018
Delisted (Canceled)
CRMLS #DW17262859 — —
Nov 22, 2017
Listed (Active)
CRMLS #DW17262859 * —
Dec 9, 2011 Sold (MLS) (Closed)
CRMLS #Y1006923 $229,000 —
Dec 8, 2011
Sold (Public Records)
Public Records $229,000 7.9%/yr
Sep 26, 2011 Pending
CRMLS #Y1006923 — —
Nov 24, 2010 Price Changed
CRMLS #Y1006923 $239,000 —
Nov 4, 2010 Listed (Active)
CRMLS #Y1006923 $242,000 —
Apr 29, 2009
Delisted
i-Tech MLS #22120555 — —
Jan 26, 2009
Price Changed
i-Tech MLS #22120555 * —
Jan 22, 2009
Listed
i-Tech MLS #22120555 * —
Oct 28, 2008 Listed
PFAR #22120555 $250,000 —
Jun 15, 2006
Sold (Public Records)
Public Records $360,000 23.6%/yr
Apr 10, 2005 Sold (MLS)
CRMLS #R51511 $280,000 —
https://www.bloomberg.com/news/articles/2019-05-09/young-real-estate-flippers-get-their-first-taste-of-losing?srnd=businessweek-v2
http://housingbubble.blog/?p=1652
http://housingbubble.blog/?p=1649
https://www.youtube.com/watch?v=q-wpG4P3ajo
From the mouth of former banksters oh banker and the domino effect will gut all price ranges!!
https://finance.yahoo.com/news/countrywide-former-ceo-predicting-luxury-090007236.html
“A $10 million home in any of those markets could “easily†lose 40% of its value, he saidâ€
He’s right. We will easily go down 40%. A no brained. Most likely prices will drop 50-70%.
The Bel Air mansion where ATF found 1,000 firearms is co-owned by a “real estate mogul”: https://www.latimes.com/local/lanow/la-me-ln-saenz-arrest-gun-investigation-20190509-story.html
A 57-year-old man identified in court records as the longtime companion of Los Angeles real estate mogul Cynthia Beck was behind bars for several hours overnight after police seized more than 1,000 guns — including some that authorities allege were fully automatic — from a home in Bel-Air. …
All of us bears keep talking about a real estate crash: however, I can’t actually see any evidence of one right now in Orange Co. and surrounding areas. Most homes under $750,000 are selling fast and may actually be increasing in price. It appears to be a slight seller’s market. The slight weakness, which I see, is limited to homes over a million dollars.
This real estate market may surprise us all by not beginning any significant price decline until next spring. The market indicators are very mixed at the moment. It is even possible that the market indicators, which I follow, may give a buy signal for real estate.
I thought RE always went up?
https://blog.seattlepi.com/seattlecondo/2019/05/08/april-2019-seattle-condo-market-update/
Bitcoin coming to housing
https://www.coindesk.com/well-tokenize-the-house-mortgages-are-coming-to-ethereum-this-summer?utm_source=twitter&utm_medium=coindesk&utm_term&utm_content&utm_campaign=Organic+
When people tell you bitcoin is dead it’s usually a good time to buy (haven’t heard it in a while from son of landlord & QE abyss). And when the mainstream media reports bitcoin due to recent surges in price it’s usually a good time to sell.
https://www.marketwatch.com/story/why-is-bitcoin-surging-here-are-4-possible-explanations-2019-05-10
There are too many people living in California. We cannot support the people we already have, so the idea of moving more into the state is insane. The real goal appears to be to force citizens out of the more desirable areas (like the sf bay area, which will be better able to survive climate change) and convert the housing in that area to upscale condos and coops to be purchased by foreigners looking for a place they and their children can live within the next 20-30 years, when their own country becomes uninhabitable. This is particularly true of the middle east, where daytime temperatures are already being occasionally seen at 120 degrees, and soon will be regularly there or above. So our nation and state are being taken over, and this proposed law is being done to help others, not to help the people of this state.
WIll this pierce an HOA? Might be high time to organize…
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