Why is Los Angeles the most unaffordable metro area in the United States? While the Los Angeles metro area ranks number 2 in total GDP, it comes in number 16 on per capita GDP.
Rental Armageddon continues to unfold in the Southland as we face triple digit record heat in October. This has been one of the hottest summers on record. The housing Kool-Aid drinkers are now praying to the weather gods hoping an El Niño will grace the land not because we need water as a basic human requirement but because they want home values to stay inflated. Forget the fact that if we have torrential rains, landslides will be epic given our multi-year drought and if you think drivers are bad today, just wait until the 405, 10, or 101 becomes a Dumb and Dumber version of the Fast and the Furious with Taco Tuesday boomers trying to make it home to enjoy a couple of hours in their heavily mortgaged crap shack. The Los Angeles metro area is the least affordable because with 13 million inhabitants, most can barely afford to live here. Half of renters spend half of their monthly income on rents while homeowners are spending 40 percent of their income on their total housing payment. While the L.A. metro area ranks number 2 in GDP, it comes in at 16 for per capita GDP. The end result is Rental Armageddon.
L.A. number 2 for GDP but 16 for per capita GDP
There is power in numbers. The economy in China was booming aside from the recent dramatic correction but wealthy families are pushing money out faster than it is coming in (i.e., foreigners buying U.S. real estate). China has 1.3 billion people while the U.S. has 321 million people. Per capita GDP in China is $7,593 and in the U.S. it is $54,629 (according to the World Bank). I would say that is a massive difference. Keep that in mind when you consider the raw number of people in the L.A. metro area. There are 13.2 million people in the L.A-Long Beach-Anaheim Metro Statistical Area (MSA) only second to New York-Newark-Jersey City MSA with 20 million. So let us take a look at GDP per MSA areas:
$826 billion is definitely good but how does this look when you actually rank it with per capita GDP with other MSAs:
Dallas, Denver, Boston, Philadelphia, and Salt Lake City MSAs all have a higher per capita GDP than L.A. You will also note true tech centers like San Jose, San Francisco, and Seattle have fantastic per capita GDP so even though the Bay Area has more expensive housing, it isn’t as expensive relative to the earnings in the L.A. MSA. This is why L.A. is facing a rather epic rental and homeownership crisis.
In fact, Los Angeles County is solidly a renting majority county and you don’t need to be a hedge fund manager to understand this chart:
L.A. County alone makes up 10 million of the MSA population (the rest come from Orange County which is also facing similar dynamics). The trend above is unmistakable. What you have is people living like sardines for ridiculous amounts of money and a vast number of people pretending to live like “ballers†but in reality are 30k millionaires. We have a lot of that in Los Angeles and the per capita GDP break down brings that out in dramatic fashion. While most can’t even afford a nice rental let alone buy a home, many are borrowing tons of money for nice cars with auto loans outstanding now breaking $1 trillion:
Car obsessed California is a primary player when it comes to borrowing money for a car. You might live with mommy and daddy but that shouldn’t stop you from driving a BMW.
There is also a sunk cost psychology that I see hitting many recent home buyers. They had to save a mega amount in terms of a down payment to purchase and now have to believe that it was the best bet in their lives. Well it would be a great bet if they sell. But they basically have paper gains similar to someone making a great stock purchase. The money isn’t in your account until you sell or close escrow and cash out. At current prices people would need to leverage every penny to get into homes. Just do a simple query on a stucco crap shack hood and witness how many people are loaded up with HELOCs or refinanced mortgages just to keep the bills manageable.
There is an interesting feature on rent.com that allows you to look at your odds of finding a rental at a certain price point in L.A.:
Source: Rent.com  Â
We also discussed in our last article how “prime†areas like Irvine are seeing tons of outside money flowing in but now, some are capitalizing by turning these pristine hoods into AirBnB and VRBO hotel zones. You also have a record breaking amount of money flowing in by foreigners. Naturally current owners are outraged that their “hoods†are turning into rental-villes but this is a market driven by large money flows from outside sources.  Being ranked number 16 on the list of per capita GDP zones for the U.S. isn’t something to brag about or the fact that renters are spending 50 percent of their income on housing and home owners are spending 40 percent. All it says is people are spending much of their relatively lower household income on paying for a roof over their head.
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122 Responses to “Why is Los Angeles the most unaffordable metro area in the United States? While the Los Angeles metro area ranks number 2 in total GDP, it comes in number 16 on per capita GDP.”
The money is too fast and too furious!
“Car obsessed California is a primary player when it comes to borrowing money for a car. You might live with mommy and daddy but that shouldn’t stop you from driving a BMW.”
If I went on the Suze Orman show, I would feel like a prostitute in church. That being said, what the good Dr. has said here is a real factor in SoCal. A co-worker’s acquaintance was saving for a down payment and waiting. With the crazy boom going on he gave up and blew the whole wad on a car. I’ll kinda feel bad for his wife/kid if housing does a Jim Taylor soon.
When I used to live in Westchester I used to go to the Hollywood (ha-ha!) Gun range, just a few miles away, by car, and I swear it would have taken far less time on a bicycle.
I have lived in Irvine for 36+ years and witness daily the gotta-have-it lifestyle.
Even the high school kids from Woodbridge and Irvine High drive Lexus or Beemers.
A theory of mine is that there a 2 unconquerable forces in the universe: The gravitational pull of black holes and the instant gratification lifestyle fueled by the financial crack cocaine of HELOC spending and 0% helicopter money.
“With the crazy boom going on he gave up and blew the whole wad on a car. I’ll kinda feel bad for his wife/kid if housing does a Jim Taylor soon.”
If that is true, he is probably doing himself, his wife and kid a tremendous disservice financially speaking. New/luxury cars are one of the biggest wastes of money for people of low to moderate means. Nice cars should be last on the list of things to buy unless you are relatively financially independent.
Hi Responder, I couldn’t agree more. I must be in the wrong profession because people like I mentioned and the folks octal sees everyday must keep business brisk.
A guy came by our house the other day pitching us to let his company dig out all our lawns and replace them with drought tolerant plants. He said that after they remove the grass they put a fabric over the dirt that will keep anything from growing there for 30 years. 30 years! And they would do it all for free, cause his company is compensated by the state. So I’m thinking, why would anyone commit to having their lawns removed for 30 years, when El Nino will likely turn the drought-factor around? Then what, you can have no lawn for three decades, even if the drought ends. I wonder how many will take him up on his deal.
They just did that where I work and I was thinking the same thing. If and when it rains, all the dirt is just going to get washed away.
On that fabric, I helped the inlaws do that in Vegas. It is difficult to keep weeds from growing through! YMMV
Jeff…Hello Jeff wake up sir, it is not a pitch, desert zero scape makes perfect sense. lawn, el Nino, grass needs constant attention, the West will heat up even more in coming years. May I suggest you visit places like North Scottsdale AZ or St George Utah where you see some of the nicest desert landscape homes in the world and they use just a drip system that cost near nothing in water bills.
This is a blog mainly about Ca. living and the high cost of it and why most want to leave, you ask why would anybody give up a lawn and that is why people want to move away, to many CA. folks think they are entitled to a lawn, a BMW, pay for a overpriced house. ( its CA. why not)?
My wife and I can leave anywhere in the world and guess why we left CA. See above remarks. take care
I would take him up on it, yard work suck$!! I’m going to look for one of those free drought yard guys in my area. Thanks for the info.
BEWARE those free desert-lawn guys. It’s been reported that some of them plant the inexpensive desert plants die quickly die, leaving you nothing but gravel and weeds.
You want a NICE desert lawn? Do research, PAY for some nice, high quality plants, then cash-in on the state rebate yourself.
Here’s an interesting news report on those free lawn guys: http://www.laweekly.com/news/turf-terminators-has-gotten-rich-turning-yards-into-gravel-but-is-it-creating-blight-5737216
“You can tell which are the Turf Terminator homes — it’s just gravel and a little bush,” she says. “It’s just a bad business. They’re just ripping off customers.”
Ellyn Meikle, who runs a drought-tolerant nursery in Torrance, says customers often come to her to fix up their Turf Terminators projects.
“They are causing blight in the neighborhoods,” she says. “It’s rocks with shrubbery. It’s the cheapest thing you can get. It makes it look like inner-city Phoenix.”
@son of a landlord
Inner city Phoenix? Ouch. 🙂
Funny …. 30 years ago when I lived in Phoenix I remember the native Arizonans complaining that the Valley of the Sun was turning into another Los Angeles. Now with LA’s growing desert landscaping, the opposite is taking place !
Terra landscaping actually helps butterflies and bees, they don’t get jack with lawns.
Lawns don’t feed anyone, no one should whine about a lawn not coming back in a drought x10.
I’m laughing at the El Nino sucker bet of more rain….If all this expected snow and rain doesn’t come, homes will be the least of our worries..
Living in LA City, we decided to convert our front yard to a drought resistant yard. We went to one of Dept Water and Powers free seminar. We also got the list of approved plants for replacing the turf. The list of plants is about 25 varieties. We bought a tiller for $100 and ripped out the grass ourselves. Then called a company that shreds trees and they agreed to bring a truck full of fresh woodchips to our home for mulch. Sending DWP pictures of before and after and proof that we had disabled our sprinkler system and we got a check for $2,800 (based on square footage of turf removed). It has been well worth the effort. We no longer water the front yard, cancelled the gardener who was mowing the lawn. We spent about $400 on drought tolerant plants. I agree with the other comments on TurfTerminators, have seen their lawn replacements with rocks and cactus and although they meet DWP requirements for rebate, their turf conversions look like crap.
Turf Terminators ?, reminds me of painting a car, you can always find somebody to do it or search out the best place to paint it. Desert landscape can be expensive I know first hand, our project cost many thousands of dollars, boulders, granite rock scape, LED lightning, desert trees, plants, cactus and variety certainly isn’t cheap but when it is all put together with a drip system is looks not only great but rather easy to maintain with trimming about every six months professionally.
Weed control is done with pre emerging one time a year the granite ground cover every Nov. to discourage the seedlings after two years they won’t appear anymore.
Again this is all very expensive to do it right the first time, if you lack funds the best option is the drip system to all plants, desert tress, cactus (no drip required), the 1/2 inch granite ground cover with select small to medium boulders and a well placed lights to some of the boulders and cacti plants. Once you do this expensive or budget landscape I can assure you after living in CA for 33 years with a Oasis landscape, we will take our desert landscape with all the colors of flowering bushes and ground cover, red and brown boulders any day if the week.
The real pay off, we have 1.1 acre property and our water bill avg. $29 a month, in Ca. with the oasis landscape we had during no restrictions was $115, I can imagine now what it would cost $300 a month, brown lawn, many dead plants, now that is a eyesore.
I’d p!ant prickly pear, free nopales 4 lyfe.
To clarify, them fuckers taste good, like green beans without the beaniness, if you know what I mean.
And goddamnit all to motherfucking hell I hate what the internet has become. Fire up your Mimeographs, people!!!!!!
Dig it up! Why do you need a lawn, are you the Kennedys playing touch football?
The coming El Nino will bring some rain, but it won’t come close to ending our long-term drought or water delivery and acquisition deficits.
You can apply for a rebate (if your water company still offers them – these programs have been very popular), pay for the work, and wait for the rebate check, or you can just have the landscaper do the work and apply for the rebates that you signed over. They might get a little more profit that way, but I’m having trouble feeling sad over that – all I did was say yes, and my lawns look way better and my water consumption is way down.
In my employers neighborhood, the state of ones lawn is a direct reflection of ones moral state. The lawn must be perfect, otherwise one is sinful.
Also, you must never maintain the lawn yourself. You have to hire someone else to keep it up.
Thiese are the mandatory rules of suburbia.
@jeff — your post is offensive. You win the award for most ignorant post of the year and you fail to win that then you’re in the running for troll of the year. Ever hear of La Nina? Usually follows El Nino and swallows up the water gains. That said, only morons would try to install grass perfect for the NE in a desert during a drought and mistake one good rainy season as a cause for declaring that all is right with the world.
“@jeff — your post is offensive. You win the award for most ignorant post of the year and you fail to win that then you’re in the running for troll of the year.”
You seriously need help if you see all that. You’re too sensitive to be on the internet. Probably too paranoid to be in a crowd…
“If we get any more sensitive we’re all gonna develop a rash” – Jim Goad.
Many weeds need almost no nutrients, and so will grow anywhere they have something granular to grab onto (dirt, sand, etc). Fabric and plastic don’t stop them from germinating in the dirt that’s on top of the fabric, but wood chips and rocks do a decent job of preventing them from reaching the dirt.
Source: did the decomposed granite over plastic thing, result was spectacular explosion of weeds
Actually those weeds that grow from apparently nothing start out from a nutty, nutritious seed, so they can run from their own power until they get established.
So grow something that’s easy on water use, and that produces nuts or fruit you like, or something the birds or animals like.
Homeless population in SoCal exploding; now moving into “desirable enclaves”. Hmmm.
http://www.hollywoodreporter.com/news/las-westside-wealthy-homeless-collide-830703
If I were gonna be street homeless, I’d sure head for a fairly nice neighborhood. Up here it would be around Palo alto or mountain view, and if I were gonna head for an area I feel comfortable down there it would be around Newport Beach.
I’d probably head for Newport Beach because I know it so well, tons of tourists and vacation ers to sell art to, and I’d have a living and studio space in very little time.
Hm, kinda defeats the mission statement, doesn’t it? I can’t seem to be street homeless if I try. I keep, like, making at least some money and being useful to people and stuff.
Fed officials seem ready to deploy negative rates in next crisis:
http://www.marketwatch.com/story/fed-officials-seem-ready-to-deploy-negative-rates-in-next-crisis-2015-10-10
Party on Wayne! Party on Garth!
The floggings will continue until moral is restored. The Fed is the very definition of insanity.
Well written ZH opinion/article that describes the impact of NIRP:
http://www.zerohedge.com/news/2015-10-11/mindless-stupidity-negative-interest-rates
Great, maybe a bank will eventually pay me to buy a house, someday. LOL
That huge homeless problem really drags down the per capita GDP
That’s not how per capita GDP works.
Bill Gates and I sit down in a restaurant and have a beer. The per capita income of our table is a shit ton of money, although this year I’ll make a bit less than 13k.
The per capita income of the USA may well be up, even though more and more people are becoming homeless.
But if more and more people started entering the bar with you and Bill Gates and made $0 money, wouldn’t the per capita GDP of the room go down?
CallSignViper – I see what you mean, but there’s so much money being made with software, automation, and merely by waving money around, that while there are increasing numbers of people being rendered homeless, the USA GDP may well be up.
That is live anywhere, but I guess we can leave anywhere if we want to?
CA. 40 Million people, 40 million takes on why it is the best place, the worse place, somewhere in the middle place, Peyton place, Mr. Rodgers place, or is it just a overwhelming place not for the faint of heart?
I’m gonna say best. Hawaii is cheapest, but I got tired of being a nigger. I GTFO ASAP.
Since I was born here in Cali I have a certain OG status, and truthfully, because I have some social network here, I can work for a living here or be homeless and collect welfare elsewhere.
Suck it, Seismic, you love it here.
I’m pretty sure you could get SOME kind of job in the Midwest making $13K minimum, and your money would go much, much further. Just getting a full time retail job would probably get you to $20K in the Midwest, and, if you do a great job, you’ll be a manager in no time.
EZ – I’m pretty sure I could head for the Midwest and be homeless and only survive the winters by building a soddy and hoarding cardboard and down from the ducks and geese i poach from the local park. No fucking thank you.
Ever since the gold rush, the quest for a quick and easy buck has been a staple of California culture. The current flipper culture is only the modern expression of that mentality. The obsessive quest for status symbols in the form of ever more expensive homes and mostly foreign cars in the belief that these things reflect how high class their owner is, is just the inevitable result of a century and a half of a civilization founded by drunken prospectors and prostitutes.
Excellent post and an thoughtful assessment of California History.
“The obsessive quest for status symbols in the form of ever more expensive homes and mostly foreign cars in the belief that these things reflect how high class their owner is, is just the inevitable result of a century and a half of a civilization founded by drunken prospectors and prostitutes”.
I believe US culture is trending this direction, evolving into never ending media coverage and celebration of unsavory people. The President has even taken time to counsel Kanye on his 2020 Presidential run, offering the nickname “Peezy” while the crowd applauds wildly. Perhaps Kanye would be a great President; also we would have our first “First Lady” (or maybe he will change it to “First B*tch”) who was b*nged/urinated on in a video that brought millions and fame, not shame, to her entire family.
Dems, spare the Trump comparison comments. I wouldn’t vote for him either.
Kanye reminds me of the movie Idiocracy where in the future the intelligent people stopped having kids and the US is populated by idiots including the WWF champion who is the current president
https://www.youtube.com/watch?v=BBvIweCIgwk
Take a look at the movie Idiocracy. I agree with your post and this movie shows what could be similar to our future.
I need to watch that movie. Out of the five of us, myself and four siblings, none of us have kids. The distopia we grew up in was nothing we’d want to bring kids into, and of course it’s worse now.
I can’t afford a TV, and I buy movies on DVD and watch them on mymold reliable windows xp laptop.
XP, its for when you need to get something done.
alex – save your money and don’t watch it.
the concept, idea and premise is great but the movie lacks good writing.
it’s good for a 10 minute SNL skit
Thank you for the recommendations; I will check Idiocracy out.
Most people I know cut cable TV; those who still have it is because of sports. I’d guess 80% of TV news content now is racial stories, LGBTX issues, OUTRAGE, celebrity worship, endless Kardasians, Ellen or Jimmy, or another stupid video that’s “gone viral”. Objectivity out the window, always some agenda rammed down viewers throats. I guess people are no longer capable of making up their own minds. Far too many scripted “reality” shows featuring creepy people. For entertainment, Netflix is great.
That is why I like blogs like this one. Differing opinions; I don’t always agree, but enjoy reading various viewpoints.
Ben, thanks for the heads up. I’ll only watch it is I can do so for free.
https://www.youtube.com/watch?v=KDuUwUhFuF4
i found this- idiocracy -the whole movie for free
Hello Doc. Speaking of LA and AirBNB, here is a recent article from the Argonaut newspaper (a paper covering the Westside) on the pro’s and con’s of short term rentals.
Here are the opening paragraphs to the full article below.
“…For those earning extra income by renting out a room, it’s a godsend. For those living next to nonstop keg parties lining an absentee landlord’s pockets, there goes the neighborhood.
The challenge of balancing homeowners’ rights with those of their neighbors as short-term vacation rentals proliferate throughout the Westside was on full display last week in Mar Vista, where Los Angeles city officials were soliciting feedback to inform a pending regulatory effort.
More than 350 people packed the Mar Vista Recreation Center on Sept. 29 to tell local planning officials stories (including many of those above) about their experiences either operating or living next to short-term vacation rentals.
Taken altogether, the thousands of short-term vacation rentals offered in Westside neighborhoods through online broker sites such as Airbnb have become
a largely unregulated temporary housing submarket….”
http://argonautnews.com/the-good-the-bad-and-the-ugly/
Maybe only rent to groups known to not whoop it up? Sikhs? HASIDS? My tablet is anti semitic!
Status symbols and one-upping the Joneses next door have always been part of the So. Cal. culture. While many people are just hanging on, So. Cal. is also home to a significant number of ‘hand-to-mouth’ wealthy, those who have fairly high incomes, but who have little to no actual savings or investments! These people have huge mortgages, lease expensive Mercedes and BMW’s, pay for private schools, private trainers, live the California lifestyle, yet are still just one paycheck away from a potential financial crisis!
You just described the guy I work for. No BMW or Mercedes, no, but a fleet of family cars, a timeshare, other money drains plus the mcmansion perches on a tiny lot with tons of deferred maintenance.
One paycheck away from disaster.
I am sick and tired of people following the drought doomsayers like sheep! When any examination of the historic data shows that we have been a long term pattern of about four dry years and two wet years for many years. The drivers in California have a tough job and they saw higher than average rainfall last in 2010/2011.
http://media.ocgov.com/gov/pw/watersheds/rainrecords/rainfalldata/historic_data/default.asp
Go to this website and download a spreadsheet with the actual data. There is also somewhere out there a website with LA data going back to the 1880s.
The Summer deluge we had in July didn’t cause me any commuting grief mainly because most of my commute is on the overbuilt I5 in Anaheim. I grew up in an area where hill movement was well known. A geologist told me that the worst problems were on the north-facing slopes, and indeed both places with the worst problems were north facing.
I live on gently sloping higher ground where we have never had a flood. People should consult experts or look up the data themselves before purchasing a property.
I remember living in socal, when we thought it might have been an earthquake, looking at the mountains. If it was an earthquake, the mountains would be, like Elvis Presley, all shook up. You would see the dust around them.
Just playing devils advocate but historically what percentage of income has been needed to purchase a SFH in SoCal? I might have lucked out twice in my lifetime. Buying in 2010 because I couldn’t find a rental nice enough to live in which warranted buying in the Southbay and then lucked out again selling in July 2015 only to find out I wasn’t going to qualify for a large enough loan to buy a new home in a nicer zip code without changing my business accounting practices. I overpay with tent with a silly amount of capital gains on the sidelines.
Housing TO Tank Hard Soon!!
Go, Jim!
As always, I hope you’re right, but I’m still clinging on to the end of 2016 prediction that I’ve been making to my family and friends, who probably think I’m nuts.
Doubt it
The people in L.A. have more children, which are unproductive, and just mouths to feed. The people in the Bay Area, such as those who have the viewpoint of those at Market and Castro streets, do not have excess baggage to carry around. I know that it is cultural in L.A. to be blessed with a lot of children. In L.A., if they choose to have 8 people per household, that is their choice. L.A. is third world in so many ways, and in the third world you find comparable stats. The 10% at the top have 90% of the wealth. Better to have the low paying jobs in L.A. than China. It cuts down on transportation costs and there are other benefits. Hey, these workers in L.A are third world people, so they do not complain. They are use to the system. The Bay Area income taxes pay for the welfare of the third world workers in L.A., so everything is cool.
Single, quit with the BS. LA has plenty of wealth, these people are paying the freight for the freeloaders all over the state. LA county has the most millionaires of any county in the US (Orange County is third)…trust me, there is plenty of money down here that is helping fill the tax coffers. Not everybody in the Bay Area is dot com millionaire, ask the guys living in shipping containers or renting out “tent space.”
The badmouthing of socal blows my mind. Like I always say, if you can afford the “desirable” areas, it’s tough to beat!
Plus we californians support a ton of freeloaders in red states.
Not you, on 13k per year. You don’t support anyone; you can barely support yourself.
Actually, I pay more than a wealthy person does in taxes, and if my genes are true, I’ll pop my clogs before I’m old enough to collect any social security.
@Lord Blankfein wrote: “… LA county has the most millionaires of any county in the US (Orange County is third)…”
This is a truly bad use of statistics. LA County with a population of almost 11 million is larger than Kansas, Nebraska, North Dakota, South Dakota, Wyoming, Idaho and Montana combined.
Using the number of millionaires per capita, LA and OC does not place in the top 25 of U.S. cities in millionaires per capita. Los Angeles-Long Beach comes in at #123, just barely ahead of Carson City, NV.
http://blogs.wsj.com/economics/2015/01/21/where-are-americas-millionaires/
Interestingly, the closest SoCal area is Ventura County (Oxnard-Thousand Oaks-Ventura, CA) which comes in at #10.
Alex, if you’re making 13.000 a year and the standard deduction is over $5000 how are you paying more in taxes than a “wealthy person” ?
DweezilSFV – I’m paying 13% of my gross into SS, Medicare, whatever the govt does with it. I can make my way through the 1040 and associated forms, and these days my income situation is very simple, so no need to hire an accountant.
When I made $70k, I sure as hell didn’t pay nine grand a year in taxes because I had an accountant do them, and write-offs.
That’s by no means rich, even twice that is not rich. But twice that is where you hire an even more clever accountant…
Thanks for the explanation, Alex.
You are absolutely right. Los Angeles is rapidly spiraling downward. Dramatic increase in homeless population, wider separation of wealth, disappearing middle class, deteriorating infrastructure, poor public school system, increase in violent crimes. Los Angeles has officially become a 3rd world country. The people I know still in LA all talk about leaving at the first possible opportunity. It boggles my mind when I see how much people pay for crap-shacks in the quasi-ghettos of LA.
Yes, where I live most of the Euro Americans have left and a diverse third world people have moved in who all self segregate. Where is a good place in California to move to where there are mostly Euro Americans?
Throw a dart at a map of the USA and you will find this everywhere. This is a feature, not a bug, of capitalism.
http://WWW.Reddit.com/r/socialism
This is happening all over the USA and not restricted to los Angeles by any means.
“Where is a good place in California to move to where there are mostly Euro Americans?”
Maybe not in CA, but I hear there are some sweet Aryan Nations compounds you could check out in Idaho.
Savannah, Ventura county is the place for you. I am a realtor that has a boat and a good Captain, so I prefer the coastal sections. If you like art, there is Ojai. There is Thousands Oaks if you like being in a college town. You can go country with Westlake Village. Ventura county has everything for you. In these places we are English speakers. Of course we have very small sections of the county where the low income workers live who speak Spanish, but you have good income to afford these other areas. Look forward to hearing from you.
Move to Fallbrook and hang out with Terrible Tommy Metzger.
I’m pretty goddamn racist through hard experience but crazy ass rural white supremacists scare me the most.
That not true anymore, birth rates for Mexicans in La and even Mexico are lower than 20 years ago. More 2nd and 3rd generation Mexicans in LA are having less kids than whites these days. Also, Dr Housing bubble like Joel Konkin spends hours and hours about the bad LA stats. LA has grown slower in the foreign born the past 10 years than places like Houston Texas where its cheaper to live. In fact conservatives are wrong on Mexico is birth rate is dropping and Mexico Pemex is selling off their oil to foreign companies which means in 10 years Mexico could be taking away the oil jobs from North Dakota and Texas.
This is sad to hear because, well, I like Mexicans! We all need to read our Marxist theory as well as read up on peak oil.
Whites rule the roost on the mainland USA thats for sure. Thats why I busted my okole to get back here. Living here is like being lbj, local born Japanese, where I grew up. I don’t have to think about my color any more than a fish has to think about the water it swims in.
Also, guess what higher interest rates will eventually happen which means LA’s housing market drops about 50,000 to 100,000 while other markets not over price like Dallas will continue to increase which means less of a price difference between them in 10 years. Dallas has increase 10 percent in a year while La is more like 3 percent.
What the fuck do I care?
I was not born into the house or land owning class, so this has about as much impact on me as the latest doings on the Bubble Space Telescope.
**Alex In San Jose**
Alex In San Jose I have some questions for you. How old are you? What is your education and professional background? You state that you earn like $12,000 to $20,000 per year. What type of work do you do? I am genuinely sincere in my questions.
I just turned 53.
Right now, I take photos and write descriptions of eBay items for my friend slash boss.
I had my own tronics surplus biz but lost everything in the crash. My friend and I work well together, he’s good at getting stuff I’m good at being orgsnized, writing, and especially taking photos.
I have plenty of free time, and can work on things of my own.
If rents go crazy high then the property owners have to worry about rent controls. In Democratic leaning cities and states like Chicago, IL, Los Angeles, CA, New York, NY that is very feasible.
There is a certain sense of economic desperation in our country. But that is what happens when economic gains are not distributed (distributed as in the mathematica/statistical sense and not in a socialist manner) across the board. You could only keep rigging the system for long until other market participants realize “hey let’s rig the market place for our benefit just like the hedge fund guys and big banks do it for themselves”.
Nimesh, I have most of a BsEE degree, which not all that long ago used to be all it took to get hired for more than minimum wage, get paid training, go as far as PhD on a company’s dime. Now it means I am nonskilled labor. I’d go work for Labor Ready, a day labor agency, if my back was in better condition.
I was considered to be destined to become an artist, and have some chops to back that up. Since just about anything pays better than STEM for the real person in the real world, this is a real option for me.
I also have a knack for music, and was making real progress on the trumpet. A recent cold, exacerbated by local brush fires, has scared me away from that. It’s an awful lot of hard blowing. I might rent a sax and give that a try though.
Alex, so how many credits are you away from obtaining your B.S. in Electrical Engineering? How long have you been out of work? Ageism is the most prevalent form of discrimination in our country but no one talks about (let’s pretend it doesn’t exist) and no one will admit to it.
I see where you are coming from in regards to your outlook. I think empathy is seriously lacking in our country. Everyone is unique and their life circumstances are unique.
Nimesh – American culture is remarkably non empathetic. Part of it is Calvinism, a particularly poisonous form of protestantism, and part of it no doubt comes from how many of our ancestors were prisoners, slaves, basically expendable.
We have an unusually cruel culture.
Yes, in my 50s, companies are not going to lime up to hire me as a junior coder. But get this, I was playing with oil painting when I was barely in high school. As bleak as art education was in the 1970s, now knowing how to do art is like having a freaking superpower.
My dear deceased parents were frustrated artists. They did not keep me from falling for the STEM scam any more than other parents have been able to keep their children!dren from meth. At least I still have my teeth!
And for the Ayn Rand wackos out there, if my genes breed true, I’ll be dead as a doornail before I draw on your beloved social security, that I’ve paid my fair share into.
And how exactly do you achieve a nice mathematical distribution without engaging in that socialist ideal / conservative anathema of redistribution?
apolitical scientist I am not advocating that the government distributes income to everyone so it is shared equally. Please see what the word distribution means in a mathematical/statistical sense. In an economic system that is not overtly rigged economic gains are distributed across all social stratas. A rising tide will lift all boats. The economic system in various regards has always been rigged. But the degree to which it is rigged today is in a blatant in your face way- the bank bailouts, hedge fund managers paying 15% tax, etc.
For thirty years we have had more economic disparity than any other country in the world and it keeps getting worse. At a certain point the electorate will say enough is enough and they will want to stick it to the man. They too will want to rig the system so they can get the gains. You could only keep rigging the economic system for long until the game is up. That is why I think that kook Bernie Sanders is so popular. Forget Trump, Bernie Sanders is the surprise so far.
apolitical scientist are you a PhD type of professor of political science?
Look up a book called Red Plenty, the Soviets actually surpassed the USA for a while there, and frankly my chances would be better under Uncle Joe than Uncle Ronnie and his present day ilk.
“are you a PhD type of professor of political science?”
PhD yes, Poly Sci heck no, though I like the slightly punning ambiguity of my username.
In any case: BS (in math actually) and PhD in a STEM field. Rather than being pedantic and pointing out that a delta-function distribution is still a legitimate mathematical distribution, I was just trying to emphasize that any tilting of the balance away from the 1% will be seen as evil socialist redistribution by some.
Apolitical Scientist – we need negative feedback loops, or the system oscillates and that means crashes and revolutions.
We need to find mealy-mouthed names and euphamisms for the money distributions, and let a generation or two of time work its magic, like it did with Medicare.
But the USA oligarchy will not go with this, its greedy and stupid. We have become a class based society, so the oligarchy isn’t really any more foresighted and capable than Joe up on the corner who runs a gas station. Probably less so, because Joe has to have some business sense. Joe knows he has to pay for capable workers, for instance.
To be an American oligarch, you merely have to be born into that class.
This is why we are headed for revolution.
If Alex in San Jose spent as much time looking for a better paying job as he does posting here day after day, maybe he wouldn’t be living in poverty? He sounds like a lazy SOB who blames anyone but himself for his life failures. Rather than take responsibility for his life, he wants others to support him! No doubt he also has substance abuse issues?
I doubt rent control will come back. That battle was fought in the 90’s and the free market won. Not that it made anything better, but still. Yeah, there is still the vestige of rent control in places, but there are ways for property owners to get around it.
The bigger issue IMO are the $15 minimum wage laws and insurance coverage paid for by employers for all restaurant workers and retail workers. Big cities are in boom times so maaaybe certain restaurants and other small businesses can afford this, but what happens when the boom becomes bust. The law won’t change overnight to lower the minimum wage or health insurance requirement – small business will leave those cities. Ever been to a city with little to no retail like Baltimore? It sucks and no one will want to live in those places.
What USA cities need is rooming houses, I lived in them from age 18 to 25, and they work great. Never paid more than $200 a month for a place to park my body when not working or in class. Mopped the floor etc on my day of the week.
Mainland USA cities got rid of those and SRO AKA piss in sink motels, because Thou Shalt Live Middle Class Or Else. Or Else means homeless.
Along with a good 5c cigar, this nation needs flophouses.
I hope not. How many rental markets have to be destroyed by rent control to prove that not only does it not work as intended, but actually drives rent much higher, and creates critical shortages of rental housing?
One would think that everyone else would have learned from the sorry example of NYC. You see, there were wage, price, and rent controls everywhere, in every city in the country, during WW2, as nothing was being built and all production was given to the war effort. However, after the war ended, most cities lifted controls immediately even though there were critical housing shortages everywhere, to the point where young newlyweds were sleeping in tents in parks. The response was the feverish construction of little crackerjack-box houses all over creation, and many apt complexes.
However, NYC, which has always been an expensive metro, kept the controls in place in response to the screaming of middle income residents. So they were kept, even though they resulted in a great shrinkage of available rental stock over ensuing decades, as every good property was converted to a co-operative, and marginal ones were run into the ground by their owners, who could not raise rents in response to rising ownership costs. Did people really expect landlords to work for no profit… or at a loss? The buildings became increasingly run down, and conditions in them were downright horrid. When they finally became so decrepit they were literally about to fall down, they were vacated and abandoned. Whole neighborhoods that had been good solid areas prior to the war, were in ruins, like the Bronx. The Bronx was a beautiful nabe with scores of stately pre-war buildings with decorative apartments that had been occupied by middle and upper middle income renters, but within two decades of the war’s close, they were reeking slums, and now their ruins are finally being torn down. Renters started looking in the Obituary pages for apartments being vacated, while, increasingly, only the privileged and connected could get their paws on a rent-controlled apt, and got ridiculously good deals- for example, Trump bought a building of huge, stately apartments complete with wine cellers and fur closets and 12′ ceilings, where a 14-room apartment was renting to one rich family for only $2000 a month in the late 80s. That was less than what it took to heat and operate the place just barely. Meanwhile, poor people had housing projects, but middle income people were squeezed out as their buildings converted to pricey co-ops.
San Francisco, also always a pricey locale, had the same experience after instituting rent control a couple of decades back. Judge for yourself whether rent control has done anything to help middle income folk to affordable housing there.
Do NOT let this happen in your city.
Laura lucozade – what happened after WWII was, tons of people but cars, got
financing to buy a house in the burbs, etc.
Suddenly hardly anyone wanted to lived in dad’s brownstone apartment, save soap slivers, and go into dad’s schmattah business.
They wanted outta that life!!!
I grew up surfing but also starving in Hawaii. The memories are great from three thousand miles away. Any closer and the revulsion is overwhelming. Ask some old black folks who got outta the south if they seriously would move back. Nope!!
So after the dirty 30s and the war, hell yeah there was an exodus.
Silly us, living car-free in a city is great!
Silly me, I can live cheap as shit back in Hawaii, but I just can’t go back there.
https://www.redfin.com/CA/Manhattan-Beach/216-16th-St-90266/home/6711992
Reality check. 53% price drop in a month. Speaking of Manhattan Beach, currently sitting at 26% reduction rate. Healthy because prices!
With historically low rates and historically low inventory, this is the best it can muster.
But hey, I’m sure “seasonal” factors explain the 103% increase in Manhattan Beach inventory YoY. Surely this season REALLY is different this time!
See what I did there. If you put “really” in all caps, it makes it true. Learned that from a born again housing speculator.
I don’t know if that Manhattan Beach price drop means anything. It’s a drop in List, and as myself and others keep saying, List prices don’t mean much. It’s the changes in actual Sales prices that matter.
All that that Manhattan Beach drop in List Price means is that the seller plucked a crazy number from thin air. The new List might also be a crazy fantasy figure.
Several years ago, some Santa Monica mansion on La Mesa Drive was Listed at $35 million. It got a lot of free press as being “the most expensive house in all of Santa Monica.” The List Price was later dropped to $30 million, and then to $25 million.
I don’t know if it eventually sold. This was several years ago. In 2012 or 2013, I think, when prices were rising. Even so, the $35 million List was a crazy fantasy figure that proved nothing about the market.
It was a very nice mansion. Indoor basketball court. Olympic size swimming pool. Several living rooms, one of which was as large as hotel lobby. A large auditorium where you could host speakers. Screening room, of course. Garage space for a fleet of cars.
But too unusual a property to suggest anything about the middle class housing market.
That particular listing was meant to be more of a fun commentary on the current state of affairs as opposed to an empirical conclusion. Regardless, an environment which offers even just one egregious example of a seller being extremely out of touch with the market leads one to wonder how many and to what degree there are others.
List matters foremost because it forms the basis for the start of negotiation. Realtor marketing edge cases aside, it is not practical for sellers to price their asks much outside of what the market will bear. When a seller can’t hit a bid at ask, it forms a data point that tells us where market price will currently not be bid. It is a leading indicator while sales price is lagging at the end of what is normally a long timeframe of procedure. Of course list is not the final say, which is precisely the point because real-time clues as to the momentum and direction of the market price are useful to bidders.
I follow some prominent economists and they have been sprouting for the past year or so how the stock and housing markets are artificially inflated, that fundamentals disappeared a long time ago, that the markets are propped up by air bubbles led by the Fed.
That its all going to crash ASAP and be much, much worse than the last crash.
It’s clear to even the average Joe the economy is running on life support and the Federal Reserve is the medical team. With all basic economic rationale out the window, I have been waiting for the prophet’s sermons (economists) to come to light, but the party just keeps going.
Because nobody really knows…a lot of people will say this and that but most expect things to make sense and they don’t. I have been on this blog for over 2 years now listening to the exact same arguments from posters who come and go.
Will it all crash and burn like last time? Will it just keep going crazy to what most believe to be unsustainable levels? Will it just plateau and not rise or fall for a time? Maybe.
There are several reasons for why the so cal housing market will crash and there are several reasons why it wont.
Everyone is on here because they in some part are interested in so cal real estate, most likely for a purchase and most are hoping the prices fall because nobody wants to spend more than they have to for a place to live.
For some people buying is a perfectly sound decision right now and for others it is not.
Do yourself a favor use this board as place to gather opinions, but don’t live your life as if the opinions here are prophetic. Nobody knows, only you can make a decision for yourself about something like this.
A lot of the data and stats on either side of this argument mean absolutely nothing to the actual market. Median incomes being low mean nothing if there are people who actually do have the money to buy. Price reductions mean nothing if the original pricing was a make me move price and not a legitimate price trying to meet the market. Low inventory means nothing if no one is able to afford the price.
Point is its your life, don’t live it letting people on an anonymous internet board scare you into or out of something you do or do not want.
I am closing escrow on a house tomorrow, I bought not because I thought I was going to get rich on the house but because I wanted to live somewhere and could afford the payment. There are advantages to both buying and renting and everyone sees those advantages differently. Make your own decisions based on what makes sense for you, life is short and you cant expect to be perfect, just make the best decision you can with the information you have available and hope that it works out in your favor and if not at least you know you did what you thought was best for you.
Good post Bryan. I’m on the fence about buying. My gut says not to…to just wait a little bit longer and see what happens. But will I still be saying that 5 years from now? Gah….who knows. All I know is that we’re getting close to recession territory, and part of me wants to see that through.
“I have been on this blog for over 2 years now listening to the exact same arguments from posters who come and go.”
I remember people in 2006 singing a similar tune.
“Everyone is on here because they in some part are interested in so cal real estate, most likely for a purchase and most are hoping the prices fall because nobody wants to spend more than they have to for a place to live.”
The reason people come here is because they have doubts about the status quo. I reckon many looking to purchase don’t want to get burned and left holding a bag, so it goes beyond simply wanting to pay less.
“For some people buying is a perfectly sound decision right now and for others it is not.”
A common feature of encouraging capitulation is to eschew interconnectedness and focus on the self. We see this all of the time, generally in the form of the useless platitude “do what’s best for yourself.” For some people taking a crap is a perfectly sound decision right now and for others it is not. No kidding?
The problem is that in order to know what’s best for “right now” involves making some guesses on how the situations and actions of others come back to the individual.
“A lot of the data and stats on either side of this argument mean absolutely nothing to the actual market. Median incomes being low mean nothing if there are people who actually do have the money to buy. Price reductions mean nothing if the original pricing was a make me move price and not a legitimate price trying to meet the market. Low inventory means nothing if no one is able to afford the price.”
The information mentioned is mostly a reflection of the market and indeed can impact the market participants. On the other hand you offer a contradiction in that “nobody knows” yet claim x, y, and z “mean absolutely nothing to the actual market” as if “somebody knows.”
“Point is its your life, don’t live it letting people on an anonymous internet board scare you into or out of something you do or do not want.”
The OP clearly stated “economists” and didn’t mention anything about commenters on this board.
“I am closing escrow on a house tomorrow, I bought not because I thought I was going to get rich on the house but because I wanted to live somewhere and could afford the payment.”
The same old story. Person wants to buy/is buying/bought a house and it’s “just a place to live” yet here they are on a housing bubble blog.
“There are advantages to both buying and renting and everyone sees those advantages differently.”
“Make your own decisions based on what makes sense for you, life is short and you cant expect to be perfect, just make the best decision you can with the information you have available and hope that it works out in your favor and if not at least you know you did what you thought was best for you.”
This offers practically nothing beyond the common sense one would hopefully already have.
More of the platitude “only you can make a decision for yourself about something like this” as if we should make our decisions in a vacuum and ignore externalities.
@ Nathan and @ HotelCA
Nathan: That was my problem is I expected a turn around, but ultimately I could not be 100% that it would happen and I found a place I really wanted to buy and worked very well for me and my situation. I did not force myself into something and we are not in over our heads payment wise, we are actually paying about the same as rent. So for us it worked, for you it may not be the right call.
I bought in part because I wanted to own and those prospects may not have been there IF the current trend of price momentum continues. Will it? who knows? Has it reversed already? Some say yes, other say no. As stated though I bought because it worked for us regardless of what the market does and trying to time the stock and house market is a bit like trying to time a blackjack or a craps table, no one knows exactly what will happen or how it will play out in the future. Will there be a dip at some point? Yes. Will that dip happen after more of a run up? I don’t know and neither does anyone else.
This forum becomes an echo chamber at times of self adulation and espousing about how smart they are for avoiding catastrophe while over the last 3 years huge gains have been made that would have weathered most of any impending dip, but they came here to tell others they knew it would all reverse and those buying were moronic and throwing money away. Up until now they have been wrong. But again I am not saying that is a reason that anyone should buy, just that although things seem one way and logic would dictate the next events, they rarely play out the way we expect.
Perhaps today is the peak and I bought at the worst time, which I did in 2007 as well, and perhaps as I will continue to read and enjoy the commentary on this site, the same discussion will be going on in 5 years with property values up another 25-50%, but again I don’t know, just perhaps.
I struggled with this decision and trying to figure out if it was the right time the past 2 years and ultimately at this time for the place we bought it was time for US to buy, but that decision may not be the right decision for someone else.
It was not easy to come to that decision with all the information out there and trying to find the truth, and I hope that whatever direction you go from here you can go with clarity of your own situation, wants, and needs. Trust me I am not sold on this market whatsoever, it may turn around or keep going…for us though buying so we did not have to worry about rising rents or landlords telling us it was time to go outweighed the possibility of another market correction.
HC: I dont really know what to say to you exactly, you seem to only want to allow your opinion to be heard and validated. I am not trying to convince anyone to do anything, I though I made that clear in the last paragraph. What I was trying to communicate is that everyone’s situation is different and the reasons you are looking to buy and I am looking to buy maybe similar but in reality are probably very far apart. And to further the point if I listened to the advice of people not in my position and not interested in real estate for the same reasons I am I could be making a big mistake as well.
I am not really sure why you would have a problem with what I said…because I did not say the market sucks, I will never buy? I offered my opinion just as you do.
You may be dead on correct about what you are saying but it still might not play out the way you are expecting.
In any event, most of the time I find your posts to be well reasoned and well thought out, and have appreciated reading them throughout the years, but you seem to attack opinions that are not in line with your beliefs.
Bryan, I agree with you. I remember visiting blogs like this one back in 1999 and all were calling for a massive real estate collapse. I bought into it and sold my house in 2000 for 235K (bought it in 1994 for 184K). Fast forward to 2006 and that same house would have sold for 615K! Had I held it to that point, no doubt in my mind I would have sold and banked the cash. I ended up renting for 4 years and then bought another house in late 2005. Took a job transfer to Toronto, Canada a few years later and just about broke even. We came back from Canada in 2013 and bought a house in Simi valley for 540K. For us, we knew we did not want to rent again and enjoy being home owners. Had we rented, our monthly rent would have been about $400 a month cheaper than what we are paying for in our mortgage, but I never liked the idea of having a landlord that could tell us we had to move out. Anyhow, my point is nobody really knows what is going to happen. As I said earlier, I remember the posts from 1999 calling for doomsday and the market did tank 9 years later. Will the housing market correct again soon? Who knows. For me it is not an investment but a place I call home.
Bryan, anonymously offering an unsolicited personal story is advocating a position and therefore seeks to influence. I’m not here to stroke egos nor engage in personal assertions.
“I bought into it”
“For me it is not an investment but a place I call home.”
It doesn’t make sense. If the skepticism found on this blog is so off-base, then why return to a poisoned well? Unless… one’s instinct is leading him or her here and/or there is an ulterior motive involved. Claiming one thing and doing another is hardly reassuring to those you’re trying to convince.
@HotelCA
you offer unsolicited stories all the time, everyone here does…you must be trying not to understand my post. I am not telling anyone to do anything. Everyone on this site has a story, I am sharing mine that is all. The point of my post is that people should not take the advice here on either side as advice that will work for them because everyone’s reason for buying is different.
You and I clearly have different reasons for buying a house, you want it to make perfect sense, I just want to not have be told to pack my family up and move in 60 days and be forced to make something work. Neither of us is right or wrong, but you are trying to turn it into that type of argument…For your situation, you are right and I am wrong. For my situation, I am right and you are wrong. The point being is you are only looking at and sharing one point of view on the market but the people on this blog are coming form more than one place. I am not sure why you wont allow others to have and share an opinion that is counter to yours without trying to berate them and tell them to stop spreading lies and trying to convince people to do the wrong thing.
If I were telling people, this thing is only going up and will never go down and if you dont buy now you’ll be priced out forever then I would understand your commentary. But I haven’t done that. I have simply commented about my housing situation and decisions on a housing blog.
For me, I wanted to own a house. I bought a house, if the market goes up, I have bought a house. If the market goes down, I have bought a house. Either way I used the money I have worked for to get what I wanted. Now, this is why I bought. if you flip that scenario the other way and say I want to buy a house, if the market goes up, I cannot afford to buy, if the market goes down I can buy a house. In that scenario, only one outcome gets me what I want.
So one way is 50/50, and the other is 100% for my situation, what have I said that is wrong?
I don’t mention that to scare anyone to do one thing or another I am providing my thought process because I know there are others in pretty similar circumstances to me and hearing multiple points of view and opinions is something that is helpful in the process of making a decision. I am not saying I bought and you should buy. I am saying I bought, and here is why I bought, even though it might not make perfect sense. For me it didnt need to make perfect sense because there were other factors involved for me than making the perfect monetary decision. For others, it is strictly an investment and making an imperfect decision would not be advisable.
Bryan, I’m not going to go with you down the road of making this personal. The bottom line is that I’ve made my points about the claims being presented and somehow this is getting sidetracked into a concern about feelings.
@Hotel CA
Not really, there is nothing personal in the commentary I have left for you. You asserted that I am claiming something as right. I am not. I am offering another point of view to the one you offer. You seek to invalidate it, because you do not agree with it.
That is the point of this entire board to have multiple points of view and let people figure out for themselves where they fall and how they feel.
I have not claimed a right or a wrong just a thought process and an alternate view of this market, but never a suggestion that anyone should or should not buy, just that they should think for themselves and not allow others on an anonymous message board make their decisions for them.
It’s not clear to the average Joe, he is caught in the whirlpool of surviving and has no idea what CDO’s, Ficas, PE’s, ABS, MBS, FASB- 157, Velocity of Money, Balance sheets etc…
cd:It’s not clear to the average Joe, he is caught in the whirlpool of surviving …
Interesting metaphor. You aren’t by chance reading The Whirlpool by George Gissing? I’m currently into that book. It’s my third Gissing book.
The Whirlpool was first published in London, in 1897. It’s a portrait of people in the “leisure class” of London society — mostly upper middle class folk who live on their investments — and what happens when an investment brokerage house goes bankrupt, tossing some of them into the economic whirlpool of life.
cd…Excellent, over whelming majority of people just work very hard job or jobs. Most can’t even imagine the situation of America, they plod along, go to a bar for happy hour to drink away their depression, if they can’t afford it off to either a crime apt area, or a small home one paycheck away from not making the payment.
Millions of people are in dead end of life, some yes by choice ,others who just can’t get a break, down on luck good folks, who will never see the light of day?
I’m the ultimate capitalist, a pretty much conservative across the spectrum guy, but I guess I have a little tug in my heart, the people I pass in my travels and the miles of poor neighborhoods, prison looking schools, weed filled medians, police cruisers driving slowly, I wonder, a country this mega rich and so many not taking part?
SOL,
I’m not reading that book. Thinking of how fast the world moves and how labor has become global in nature, life will be much harder for the generations to follow in the US. Peak America is behind us..
I think that we all agree that L.A. is just a bunch of philistines, at least that is the view from The City. We in The City live a whole different life that you philistines could never imagine.
“I was just trying to emphasize that any tilting of the balance away from the 1% will be seen as evil socialist redistribution by some”
Apolitical scientist,
I am one of those you refer to. On the other hand, I do not mind a good solid redistribution from the 0.01% from the top.
The reason for this, is the fact that 1% is a very large number (over 3 million) and the real abuse of power and scheming is not done by these individuals. They may be doctors (with mountains of student loans, some over $300,000), highly educated, productive individuals who sacrificed a lot in terms of education, money and free time, small business owners who are number one job creators in this country.
On the other hand, the 0.01% from the top hold the real wealth, the real power to scheme
and lobby for laws in their favor. They are the ones who control the Wall Street and through that the whole Potus and Scotus. When they talk about increasing the taxes on the rich they mean the 99% of the top 10%, the ones below them who might chalange their supremacy. Then through inflation they push the whole middle class (whatever is left of it) in the high tax bracket till you have only the super rich (0.01%) and all others equal poor – pretty much the class distribution of a communist country.
Those 0.01% from the top with the only real power to change laws are NEVER going to vote to increase taxes on themselves; for that they have loopholes.
Just want to give a shout out to dr housing bubble. Great articles and a great community that has been built here. I am proud to be a member.
True Jim, this is a good site, DR. does nice research, is for most part easy to understand the plight of housing not only in CA. but America. The posters some come and go but in general very good takes and they keep it civil.
All in all with the remaining sites left on the web this is in the top 3 for sure.
Middle East multi and billionaires now replacing the Chinese as making Ca the place to be. In my conversation with these folks I ask them why Ca and especially LA, they always replay why not. They love the climate, lush landscape and to be notice driving short distance in fashionable cars. They care less about water shortage, liberal politics, crime, and the street people. All they know is a playground fast life and more freedom than back home in places in Arabia. There wives and children, family and friends who visit love the place.
So you see as long as the overseas folks with tons of money keep coming than the separation of very rich and poor will continue on and the so called middle class will again be lower class, with their collective heads barely above water, should I even mention water?
robert: They love the climate,
It is so HOT and HUMID here in Santa Monica. (What’s it like in the Valley?) At night, when I go for walks, it is HOT and HUMID.
I see all the Halloween lawn decorations, and think, yup, nothing like HOT, HUMID fall weather to put me in the mood for Halloween and Thanksgiving.
lush landscape
How long before they jack up the water rates, or even force everyone to plant drought resistant lawns? There’s a global media posse hunting for that Bel Air water waster: http://www.latimes.com/local/california/la-me-1007-lopez-water-glutton-20151007-column.html
KFI-AM’s John and Ken report that they even have a guy in England, scanning Google satellite photos, in search of the Bel Air water waster.
and to be notice driving short distance in fashionable cars.
It can take an hour to drive a “short distance” in L.A. traffic. Hours (plural) if you want to get to the other side of town, or from the Westside to parts of the Valley.
I’ve seen some houses I like (not love) and can afford, in neighborhoods I like (not love). But I hesitate to make an offer, because a part of me just wants to leave L.A. for good. Can’t decide whether to stay or move to the Pacific Northwest.
SOL…..I get it, most of these folks like the weather, they also like overpriced houses, water large grass areas, drive 10 mpg cars, what can we take from these people, They have bucks and don’t give a hoot what Ca. Tax payers and Sacremento tells them?
BTW… You seem to have problem when I poet such as taking out of context, first of all we have all the right to challenge a post, but don’t take a statement that I may quote and refernce
Robert, I have no idea what you’re trying to say, or what you think I did.
son of a landlord Just ignore the post that was made to you no issues, take care.
The biggest issues is that the job market in CA sucks. Companies know they can pay you less and on average the wages reflect this fact. Most people in California earn much less than they would earn in some god forsaken flyover state.
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