“If You Own a Home in Palo Alto, CA, Sell it Now”

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Utter insanity is turning south.

In Palo Alto, a small town of about 67,000 souls, including Facebook CEO Mark Zuckerberg, about an hour south of San Francisco, in the middle of Silicon Valley, and part of the 9 million people in the vast Bay Area, the median home value in July, according to Zillow, fell to $2.486 million.

That’s still up 103% from July 2011. These are not palaces. Median price means 50% cost more, 50% cost less. These are modest homes, in theory where the median household can settle down. Drop to $1 million, and you get the “million dollar shack.”

But the median price is up only 1.6% from July last year, and down 0.5% from the peak in April of $2.5 million, a tiny fraction really – “tiny fraction” in Palo Alto means $12,500.

The median listed price per square foot, at $1,357, is down 7% from June.

Prices started “plateauing” a year ago, which means they’re now heading south. Zillow, with its usual optimism, expects them to drop only another 0.3% over the next twelve months.

The 71 homes listed for sale on Zillow start with four 1-bedroom 1-bath condos of around 770 sq. ft. each, in the range of $540,000. Two of them have been on Zillow for 41 days, and two appeared 11 days ago. There are also 2 pre-foreclosure units, to be sold at auction, and one foreclosed 1-bedroom 1-bath condo.

It doesn’t take long to get into the median price range of $2.5 million, and there’s plenty, some of them with reduced prices, some of them on the market for over 150 days.

Then, at the top end of the pile is a 5,330 sq. ft. home listed for $17.5 million, on Zillow for 68 days so far.

If the price of the median home doubles over a period of five years, as they did in Palo Alto, it’s not because that median home has gotten to be twice as big or twice as nice, or whatever, but because the dollar has lost half its value with regards to this type of asset. It’s called asset price inflation.

Central banks have been very effective in creating asset price inflation. Stocks, bonds, commercial and residential real estate, etc. all have skyrocketed.

There are also consumer price inflation, producer price inflation, wage inflation etc., and in that regard, the dollar has been holding up better.

The median rent in Palo Alto is $5,800, which puts even San Francisco to shame. The Zillow Rent Index sits at $6,318, down about 3% from November last year. Like home prices, rents have plateaued with a southern bias.

So it’s a money suck. Which is fine when prices go up, and if you have an unlimited amount of money. But now that prices have hit a wall, and if you don’t have an unlimited amount of money, the money suck can get painful in a hurry.

People are already putting two and two together and are bailing out, including Kate Vershov Downing, who resigned from the Palo Alto Planning and Transportation Commission. Her letter of resignation, dated August 9, starts out this way:

This letter serves as my official resignation from the Planning and Transportation Commission. My family has decided to move to Santa Cruz. After many years of trying to make it work in Palo Alto, my husband and I cannot see a way to stay in Palo Alto and raise a family here. We rent our current home with another couple for $6200 a month; if we wanted to buy the same home and share it with children and not roommates, it would cost $2.7M and our monthly payment would be $12,177 a month in mortgage, taxes, and insurance. That’s $146,127 per year – an entire professional’s income before taxes. This is unaffordable even for an attorney and a software engineer.

It’s not a place for young people either, despite its Silicon Valley allure, unless they want to bunk down together and with their combined high salaries pack into a median house. “Hacker hotels,” they’re called. That’s fun, for a little while. And then? Bloomberg explains it this way:

Palo Alto lost 7% of its 18- to 44-year-old population in the 2000s, the only age group to show a decline, according to Census data cited in the city’s report. Those aged 45 to 64 grew by 19% and older than 65 increased 20%.

The power behind this rampant home price inflation? Maybe “tech.” But probably not anymore, given that tech salaries for most employees no longer suffice to live adequately in the town.

And foreign buyers looking to get their money out of harm’s way, and not caring about what price they pay? “Realty bus tours popular with Chinese and Indian buyers are a common sight, with purchases leading to unoccupied investment properties dubbed ‘ghost houses,’” as Bloomberg put it. But China is cracking down on money laundering. And the US government’s anti-money-laundering efforts recently stopped ignoring real estate. So foreign buyers too may be drying up, as the languishing prices indicate.

Many folks have suggested that Palo Alto needs more subsidized “affordable” housing – though that may not help much either, except make life even more expensive for the rest of them.

The real solution? As a matter of principle, I don’t give financial advice. But if I were out there giving financial advice and charging an arm and a leg for it, it would sound like this: “If you own a home in Palo Alto, sell it now.”

There has never been a more perfect time to sell, except perhaps earlier this year, but that train has departed. Cash out of this bubble while the cashing out is still good. Let someone else get stuck with the losses. Because a 30% loss on the median home of $2.5 million is a cool $750,000. And losses after such a breath-taking real estate bubble can exceed 50% without breaking a sweat.

If you rode up the gravy train from 2011, and doubled your money and made $1.2 million on your home, don’t let the market take that away from you. That’s what I’d say if I were selling financial advice, and then I’d send you a bill for an arm and a leg.

And for crying out loud, make sure you don’t buy again in Palo Alto because you would just plow your money back into the bubble. Move to downtown Detroit, which is getting cool again, and telecommute, while laughing all the way to the bank, every day. You wouldn’t be the first one to do it!

I get chills when insiders tell outsiders “not to panic.” Read…  ‘A Good Reason Not to Panic’ about July’s Plunging Home Sales

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  78 comments for ““If You Own a Home in Palo Alto, CA, Sell it Now”

  1. Chip Javert
    August 30, 2016 at 8:08 pm


    In the past few years has there been any gentrification in East Palo Alto?

    • August 30, 2016 at 8:45 pm

      Yes. And some resistance too. Given these kinds of prices and rents in surrounding areas, gentrification is going to happen, and some of this welcome, too.

  2. Keith
    August 30, 2016 at 8:16 pm

    It is hard to keep a sane mind when your house has doubled in value. Those that missed the boat are in insane ones so to say. I called the first real estate bubble and told friends to get out. They thought me crazy. I am now telling them again. They still think I’m crazy…why? Because prices have come back. I doubt that it will be as easy as that the next time. I plan to buy on the next dip, I mean crash…for cash.

    • nhz
      August 31, 2016 at 3:23 am

      I doubt anyone can time these bubbles.

      The Dutch housing bubble started in the late eighties and has come back two times already (after 2001 and after 2008) thanks to ever more desperate policies from politicians and central banksters. Over this time home prices have increased by 1000-2000% with very little increase in real incomes. I had to sell in 2001 (with paper gains of about 500%) due to an idiotic tax change, and have never been able to buy back into the housing market because both times the market ‘crashed’ it was clearly deemed TBTF by the elites.

      Markets can remain irrational for far longer (and to far more extreme extent) than most people imagine, especially now that central banks are all-in.

      And just in case: being in cash waiting for the next ‘dip’ means enjoying crushing rents and the risk of losing your money in the next bankster bailout :-(

      • Graham
        August 31, 2016 at 3:58 am

        “I doubt anyone can time these bubbles”

        Sometimes it’s difficult to tell a blip from a trend, but every other single economic indicator supports this as being a trend.

        As prices peaked in 2011/2012 and are now well on their way down I think this one is easy to see. Same as the 2002 crash, it wasn’t overnight for most, it was a trend gaining momentum.

        So IMO we can be certain this real estate ‘crash’ is the same as all the others happening about now – for real…

    • frederick
      August 31, 2016 at 12:31 pm

      Im of the same philosophy Keith sold my place early (2014) in Sag Harbor NY and the wait is killing me

  3. VegasBob
    August 30, 2016 at 8:45 pm

    Earlier today I read a friend’s Fakebook post about how Portland, Oregon real estate prices are ‘not in a bubble.’

    Yes, paying $350,000 for a ~900sf termite-infested crap shack in the worst section of town is not buying into a bubble.

    I think this guy is going to be in for a very rude awakening fairly soon.

    • MC
      August 31, 2016 at 2:45 am

      Are you sure he’s not merely in the house flipping business and has no intention of living there? Perhaps he’s merely betting his $350,000 shack will become a $450,000 shack in a couple of years.
      Dangerous, I know, but not much more dangerous than buying stocks at extreme valuations hoping they will go even higher.

      • Graham
        August 31, 2016 at 4:02 am

        I wonder when the FED will start buying up real estate directly?

        In the mathematics of their ‘rent-a-currency’ funny money is the stark formula that one day, everything gets owned by them.

        It’s already happened in shares and bonds – central banks owning our companies – real estate could well be next, which would stop a crash.

        It’s about the only thing that would mind… we’re already in the middle of a huge crash and recession – hidden cleverly by the FED’s gobbling up of our companies which puts scaffolding under the share prices.

        • Petunia
          August 31, 2016 at 9:03 am

          The fed may not be buying properties directly but they own a heap of them in places like Detroit, New Orleans, and the other undesirable areas of the country. Check out the HUD website.

  4. Lune
    August 30, 2016 at 9:16 pm

    I understand the anti-development crowd to some extent: not everyone wants to live in high density Manhattan, after all. But I’m sure people realize the eye-watering prices in the Bay Area are driving away good people, good jobs, and all in all, is not healthy. So the question is, why hasn’t development taken off in these places? Is the NIMBY crowd that strong?

    I mean, 9 million is a lot of people, but Chicago’s metropolitan population is nearly 10mil and prices are much, much lower, with a spectrum from high density urban downtown to nearly rural exurbs. Incidentally, the Chicago area GDP is also significantly higher than the Bay Area, meaning that despite the SV tech boom, Chicago manages to produce more economic output, produce more good paying jobs (with higher per capita GDP), and house more people, with significantly less cost of living than the Bay Area. Plus, while the city of SF may be landlocked, the Bay Area as a whole has plenty of space.

    So what exactly is the Bay Area doing so wrong (from an urban planning perspective) to end up where it is?

    • Gordon
      August 30, 2016 at 9:28 pm

      Do to the way taxes are collected, cities try very hard to building of residential units, but welcome in offices and retail buildings.

    • August 30, 2016 at 10:16 pm

      There’s a HUGE building boom going on in the Bay Area right now. High rises everywhere. San Francisco more than any other city here. Tens of thousands of housing units are coming on the market every year, for years to come. Something we’re watching closely. We call it a “glut.” It will eventually help bring balance to the price environment (I would think at a much lover level).

      Not every town in the Bay Area has seen these towers and large developments sprout, but many of the larger ones are seeing them.

      • Lune
        August 31, 2016 at 8:52 am

        So you’re saying it’s a matter of timing: the economy boomed faster than development could keep up. Sounds like a reasonable hypothesis. this means prices should crater when the economy slows down and the development boom doesn’t stop for a few years.

        I guess we’ll see if that happens now…

    • hidflect
      August 31, 2016 at 4:03 am

      Where I live here in Perth, Western Australia the flightpath got shifted to go over my suburb which adjoins a very, “old money” suburb. Well damn me if that flightpath isn’t being shifted back again double smart. There’s money and then there’s power.

      • Chicken
        August 31, 2016 at 9:11 am

        Yes that’s correct, absolutely. You owe someone a pineapple.

    • Oh really?
      August 31, 2016 at 7:18 am

      Is Boeing counted in the Chicago GDP? It may be since they moved their headquarters there several years ago. If so, that would be a huge outlier and partially explain why there is less development in Chicago.

    • Petunia
      August 31, 2016 at 9:18 am

      Having grown up in NYC, I got to see how a big expensive city builds low income housing. They use land in under utilized areas, such as landfills or old industrial areas, and they give subsidies to the developers. Without the subsidies the developers cannot afford to build low income housing because they cannot recoup the cost of union labor, land, and materials. All the low income housing is built this way and always has been since the great depression in the thirties.

      In the case of low/middle income buyers the city gave ten year tax abatement. I bought my first home this way. The first year I paid no RE tax and it went up 10% a year until it reached full assessment. The tax abatement went with the house when I sold it. This is how the city got people to move out into Staten Island. Now one of the more desirable areas of the city for working people.

      There were some very desirable middle income rental developments in the city, built by big insurance companies for income. Stuyvesant Town was one that was sold a few years ago to a hedge fund for 5 or 6 billion. It is being slowly turned into luxury housing.

    • Justme
      August 31, 2016 at 2:06 pm

      Lune, how do you get that Chicago metro has higher GDP/capita than SFbay Metro? I looked in wikipedia and could not get it to jibe. Do you have a better data source?

  5. michael
    August 30, 2016 at 10:21 pm

    No hesitation to build in Fremont. Lots of new commercial space, single family homes, and town homes. In Patterson Ranch there are no allocated schools for those buying the $1. 3 plus Million dollar homes. Bet that is a nice surprise for the buyers. The funny thing is there is a great deal of unoccupied retail and commercial buildings. The downside is going to be brutal.

  6. Merlin
    August 30, 2016 at 11:06 pm

    I can’t begin to understand the monetary outlay to live in California. Here in flyover country, I could buy 40 acres of rolling hills and meadows with deer and wild turkey and several ponds with a modest 2500 sq ft home for 500k, yet be at Saks 5th Ave or lululemon in <30 minutes if I felt like I needed a $38 pair of drawers or a $58 tee (not likely…..:)

    What is "middle class" in California – $250k income per year???

    • August 31, 2016 at 12:00 am

      Median household income in San Francisco is about $84,000. That’s the problem. Huge house price inflation and rent inflation, but not much wage inflation, except at the top 10% or so.

      • Miggy
        August 31, 2016 at 12:36 am

        You can say that about everywhere just tweak the numbers a a little. Don’t forget insurance either, they always get theirs too.

  7. Uncle Frank
    August 31, 2016 at 4:22 am

    The Santa Cruz area is seeing an incrasing bubble in the price of housing as Silicon Valley workers try to escape to cheaper areas. Some homes in Aptos have increased in price by 200K since the beginning of the year.

    • Tommy
      September 6, 2016 at 10:38 pm

      i’ve been following Santa Cruz/ Aptos/ Portola Valley/ Capitola, etc. for the past yr or so, to see whether the outlying areas around santa clara are getting weaker (get zillow emails for price changes and new listings). in the past few weeks, i’ve gotten tens of emails of new listings and price reductions- first time in many years. the homes are staying on the market much longer too- beyond 1-2 mo. i think Wolf’s observations re: Palo Alto are correct, and the outer rings of commuter homes around it are really getting hit in the past month, in my unofficial observation.

  8. Chris from Dallas
    August 31, 2016 at 6:28 am

    Follow Wolf’s advise, SELL NOW, move, take your $1.2mm in real money ($250- $500k of which is tax free depending upon if single/married), invest in affordable rental homes, and then give it some time for a 3 – 10-fold increase.

    Yes, you will have to get out of your CLEAN tech bubble and deal with the real world, but you can get others to do the grungy work.

    If you are smart enough for SV you can certainly grow your $1.2mm into $4-$10mm of cash flowing properties PLUS GROWTH.

    At that point your overpriced, bubblicious SV home has turned into GENERATIONAL WEALTH, relatively easy to maintain and pass down.


    It takes COURAGE, clear thinking and TIME.

    I speak from experience.

    I did it, moving from NYC to Dallas. Was a software developer for 20 years. It took 20 years to build a good rental house portfolio (with a 10 year overlap with my software co).

    Have been approached and freely given advise to literally 80+ people, but virtually none of them had the courage.

    Even when I am sitting in front of them as proof that it works.

    Btw, this also avoids the rampant age discrimination in tech.

    • Holly
      August 31, 2016 at 7:19 am

      I agree with you. I have done the same. Real estate investment should be a long term investment. Price fluctuations do not matter if you are not selling. Buy conservatively, keep adequate equity, keep property in good repair. If you see dangerous conditions in a particular market you can sell and move into a more favorable market and avoid heavy taxes via a 1031 exchange.

  9. Dan Romig
    August 31, 2016 at 6:34 am

    Wow. The median listing price is $1,357 per square foot in Palo Alto. Now, divide that by 10 for the first-ring suburbs of Minneapolis where recent sales in Bloomington went at $126 per, and in Richfield at $131.

    Location, location, location!

    • Chris from Dallas
      August 31, 2016 at 8:58 am

      To be fair you have to compare median incomes against cost-of-living.

      Still, even in comparative terms, Palo Alto is 1.73x more expensive than Bloomington. Add that up and compound it over a 45-year career and it gets really ugly.

      COST OF LIVING Blmgtn Palo Ratio U.S.

        Overall   98 415 24% 100
        Grocery   93.7 118.1 79% 100
        Health    95 114 83% 100
        Housing   102 1061 10% 100
        Utilities   88 124 71% 100
        Transportation   100 113 88% 100
        Miscellaneous   98 102 96% 100

      INCOME $50,054 $122,482 41%

      RATIO $511 $295 173%
      (Income / Cost)


      • Dan Romig
        August 31, 2016 at 12:17 pm

        Chris, of course their are quite a lot of factors that add up to cost of living – housing being one the biggest costs. But, to live just south of Minneapolis (not Indiana as your link cites), it is basically ten cents on the dollar per square foot compared to Palo Alto.

        Long ago, while studying physics, a professor remarked, “Any thing that is one order of magnitude different is worth double checking.”

        My home by the Mississippi, and in between MSP airport and downtown Minneapolis is worth about $150 to $155 per square foot. If I could get ten times that, I’d sell in a heartbeat!

  10. VK
    August 31, 2016 at 7:18 am

    The bubble will eventually burst. The only question is what will the govt’s response be to this? Inflated asset prices can only be supported in the long term by rising wages and rising productivity and that’s not happening.

    On a related note, oil looks to be headed considerably higher over the next few years, via a Bloomberg article:

    “Explorers in 2015 discovered only about a tenth as much oil as they have annually on average since 1960. This year, they’ll probably find even less, spurring new fears about their ability to meet future demand.
    With oil prices down by more than half since the price collapse two years ago, drillers have cut their exploration budgets to the bone. The result: Just 2.7 billion barrels of new supply was discovered in 2015, the smallest amount since 1947, according to figures from Edinburgh-based consulting firm Wood Mackenzie Ltd. This year, drillers found just 736 million barrels of conventional crude as of the end of last month…

    Global spending on exploration, from seismic studies to actual drilling, has been cut to $40 billion this year from about $100 billion in 2014, said Andrew Latham, Wood Mackenzie’s vice president for global exploration. Moving ahead, spending is likely to remain at the same level through 2018, he said.”

    • Chicken
      August 31, 2016 at 9:22 am

      Our ME allies will continue flooding the planet going into the end of the oil age as a few solar panels on your roof and a wall of gassy high maintenance batteries replace that 40,000 Watt box on the side of your house.

    • nhz
      August 31, 2016 at 1:48 pm

      “The bubble will eventually burst. The only question is what will the govt’s response be to this? Inflated asset prices can only be supported in the long term by rising wages and rising productivity and that’s not happening. ”

      People in the US often ignore it, but the Dutch housing bubble has been inflating for nearly 30 years now and the gains are MUCH bigger than in the US. By all normal financial/economic wisdom, the Dutch bubble should have crashed in the late nineties after many years of over 10% yoy gains (and very little income growth). But it didn’t thanks to government intervention, although sales volume crashed two times with an average 10-20% decline in prices.

      People have NO IDEA what a desperate government can do to keep home prices inflating. If you are interested study the Netherlands – most of the idiot measures to support the bubble are unknown in the US, so I would not count on this US bubble being ‘finished’. If the Dutch can keep blowing bubbles, the US can do that too (admittedly, the Dutch have 400 year experience with blowing financial bubbles so they have a headstart …).

  11. RD Blakeslee
    August 31, 2016 at 7:24 am

    My sons and I built our house, on a ridge in the mountains of Eastern West Virginia 39 years ago.

    So the term “home” means something more to us than merely “house”.

    Pardon me, Wolf, but IMO your headline should read ““If You Own a HOUSE in Palo Alto, CA, Sell it Now”

    • August 31, 2016 at 8:07 am

      Your point is well taken. But I would then have to say “House or Condo.” In some cities I would have to say, “House, Condo, Coop, or TIC.” So I fall back on the summary word “home.”

      • RD Blakeslee
        August 31, 2016 at 4:19 pm

        How about “dwelling”? That’s generic to shelter structures, without the connotation that “home” has.

        Admittedly, “dwelling” is not common vernacular.

  12. Chicken
    August 31, 2016 at 9:14 am

    At least we have the millennials entering their prime now, they’re going to rescue us from doom, global warming, terrorism and all these health miladies we’ve suffered from for decades..

    • ERG
      August 31, 2016 at 9:28 am

      You forgot the “/sarc”….

  13. Mary
    August 31, 2016 at 9:35 am

    You publish a couple of these housing bubble columns a week. Their cumulative advice seems to be: sell now! get out while the getting’s good! money is all that matters! you’re a fool if you don’t take the money and run!

    Is this irony, or straightforward advice? I’m a regular reader, and sometimes I find Wolfstreet’s tone hard to parse. Given that I own a condo which is worth twice what I paid, in a community with a huge building boom, I’m getting worried.

    • August 31, 2016 at 9:59 am

      As you know, I don’t give advice. I just try to report data and analyze it and explain it. WS readers are smart, and they make their own decisions.

      My “advice” this time was very much tongue in cheek, as you could tell. But reality remains: there are great times to buy, and there are great times to sell. It seems you picked a great time to buy your condo. And I totally understand the quandary you’re in now.

      Here’s the thing: if your condo is your “home” (rather than an investment) that you bought at the right time and can make the payments on without problems and want to live in for many more years … great. You can ride out the storm.

      But if you want to make some big money on it, you can only do that if you sell at a great time to sell.

      Condo prices are a lot more volatile than house prices. In hot bubble areas, condo prices in the past have dropped 70%. That’s a big chunk of money.

    • August 31, 2016 at 10:17 am

      BTW, I’m writing more of these articles now because the situation is reaching a turning in some cities, and identifying the turning points is key (it’s easy and safe to do with hindsight, but it’s hard and risky in real time).

      • Miggy
        August 31, 2016 at 10:54 am

        A well timed historical piece may be in order with charts, numbers and the whole 9 yards.

    • Petunia
      August 31, 2016 at 10:49 am


      You have made 100% on your condo, but the 100% of what(the base) matters. If you are up $100K and the cost of selling, renting, moving twice, and buying again are going to eat into your profit, it may not be worth it. If you are up $500K the picture is a lot different. The price level of the area matters a lot.

      • Mary
        August 31, 2016 at 11:40 am

        My question was really about how personal financial decisions should/should not be influenced by macro economic factors.

        My real quandary re the advice in Wolfstreet isn’t whether to sell our home. It’s the stock market. I’ve been a Wolfstreet reader for about three years, and since I take Wolf’s wise commentary on the market seriously, I’ve become paralyzed. His many smart columns on Wall Street’s corrupt practices have left me walking in circles. My broker (a very nice woman) is fed up with all the Wolfstreet columns I’m forwarding. She recently compared me to Scrooge McDuck with his swimming pool of cash.

        • Petunia
          August 31, 2016 at 12:10 pm

          I worked in banking and on Wall St. and I wouldn’t put up any significant money in the market. I would be in it in the same way I buy a lotto ticket or drop $20 into a slot machine. Look at the people running the markets and the companies and bet on what ever feels and looks right to you. If the economy tanks, it is never wrong, to have been in cash.

        • JZ
          August 31, 2016 at 2:47 pm

          My oppinion is that people should not play competitive games without knowing her own competitiveness.

          If you are looking for Wolfe for advice, you do not know your own competitiveness. So you should not play.

          From that point of view, my competitiveness against all the Wall Street pros is that I have a W2 job. Which means I can afford not to play on daily, monthly, yearly basis. I only play after they have killed each other in the market. Then I have an edge.

          So now is not the time. I will focus on my W2 job. I have so much cash that I do not care about central banks hurting me with negative rates. It will hurt pension guys more to the point Wall Street will go against it.

          If you do not have. W2 job, and you play without a competitive edge, I guarantee you will get murdered in the end, maybe after a few successful occasions.

          House is a different matter. It is not a game people play. People have to live in it. The principle of buying and selling should not be dependent on the direction of the price. It depends on whether you will lose your freedom.

          The sharks in houses want you to take on debt so that if you do not vote for them, you will get hurt. So it is a control mechanism. If you are the person who values consumption more than freedom, I guarantee you will lose your freedom.

  14. kitten lopez
    August 31, 2016 at 11:38 am

    Wolf, I LOVE this stuff. Like an earlier commenter had said of your site: i’m also relieved you’re doing this reality check of a website because living here in sf, the mission and SOMA, among the insanity and the propoganda will make you SILLY CRAZY MAD.

    also, i watched the movie you’d linked to before, “A Million Dollar Shack” and the midwestern folks who thought the realtor, Deleon, was fake are hilarious! because those Deleon-type shmucks really are everywhere here and to them no one else exists as they nearly run over pedestrians because stop signs don’t apply to them. And actually, Deleon seems like one of the NICER ones.

    and to those of you who keep championing capitalism and buying up “affordable” rental properties to make money off of, i can’t help but seeing you as predatory bottom feeders now. i grew up with my ivy league mom championing ayn rand and free market and democracy and cream rising to the top…

    i went along til i realized it was all rigged.

    because yeah, when you’ve chained the population to buckets of cement then tossed us overboard, yeah, you’ll do GREAT. at what cost? because when you think it’s okay to do okay by flushing weaker folks’ heads down the toilet you’re peeing in ALL our water. there’s no separate “smoking section”. there never really WAS, was there, though?

    there’s no arguing with people who don’t think you even have a right to exist or live a clean life in the first place. this is a mean, mean country. all i can do is shrug when that Deleon realtor guy says all the people with all the education and inherited connections/money deserve everything.

    THAT is the american way for realz, y’all.

    i used to think the middle class would revolt before this acid took them down, but now i see that Chris Hedges was right. the middle class is over. they believed in this “democracy” thing and that their votes were counted but they never knew when enough was enough to fight back. now they’re toast and like deer in the proverbial headlights. that’s how i feel watching “a million dollar shack.” like daaaaamn… it’s OVER now.

    the only ones who know HOW to fight back are dead, in prison, or hopped up on meds to keep ’em complacently hating themselves for not getting a job.

    brilliant system. i’m in AWE even as i’m in HORROR. i used to read stephen king for the pleasure of terror. this makes his stuff seem like dr. seuss next to reality in america now.

    everyone ELSE owns our stuff and keeping it empty instead of even renting it BACK to us??? and no one’s squatting because the cops will defend the right to property above all else.

    brilliant, the god$ that this country bows to.

    • Petunia
      August 31, 2016 at 12:17 pm

      The Dallas Police Dept. Pension Fund has been raided by the people they go out of their way to protect, the bankers. I thought you might enjoy that tidbit. The parasites never have enough. We are all in for some really ugly times ahead.

    • Mary
      August 31, 2016 at 12:51 pm

      How nice to meet a fellow angry woman radical in the Comments section of Wolfstreet. I always look for Petunia’s posts and now I hope to see more from Kitten Lopez.

  15. Shawn
    August 31, 2016 at 12:15 pm

    Another magic number in your article, “9 million people in the vast Bay Area”. When i arrived here in 2002 there were 6.5 million people. Low interest rates and vast amounts of money printing have caused this area to surge in population. I do not know what the end game is here but I just might move the Michigan where I can get paid as much as I do here, but the winters would really suck.

  16. catlady
    August 31, 2016 at 12:27 pm

    would like to hear more about downtown detroit being cool again. give us people in flyover country some hope!!!!

    • August 31, 2016 at 1:31 pm

      Google it!!! Look at the pics. Companies are settling there again.

      A software developer I know made the move (from San Francisco) in 2008, bought a huge loft in a remodeled warehouse for a pittance in cash and never looked back.

  17. Fesky
    August 31, 2016 at 1:19 pm

    I live in San Mateo, SFBA I’m patiently waiting for the bubble to burst since 2014 at least but up to 2016 month of march my rent has increased by 70% from in that period. Then it stalled, and I wasn’t sure if it is my wishful thinking or smth is happening there. For another 5 months the rental prices stayed the same but the rotation in our complex became absurdly awful! 2-3 ppl living on mattresses in each room for just few months at a time, our neighbors rent out 3bd and sublet two of the bedrooms so ppl move in and out literally every weekend. As much as I loved living here, I wish I could buys smth and move already. Its perpetual revolving door here.
    So, after reading this article I went online to check rental prices in our complex (owned by Equity Residential – good old Equity!) and the rental prices have FALLEN for the first time Equity Residential took over this complex in 2012! Not only it is whopping 200 bucks difference per each unit, they give gift vouchers worth $1500 upon lease signup! I’m only assuming you can redeem these vouchers or exchange them for a discount from the first month lease or alike.
    I don’t think it is so-called leveling out. At this point I truly believe something must be actually brewing here!

    • August 31, 2016 at 1:35 pm

      Thanks for the boots-on-the-apartment-floor update!!

      • Tommyc
        September 6, 2016 at 10:56 pm

        agreed. I live in san mateo county as well, sold my home in early 2015, and have been waiting…. my rent started high, and is still high at about 5000 (a good price, actually, for a 2000 sq ft townhouse) for the next year. However, I’ve noticed this summer has had more homes (rent and sales) on the market, it seems, and and they don’t seem to be moving too quickly like before. A few homes have even DROPPED in price about 100K. how bout them beans.- homes have still about doubled in price since 2011, so 100K isn’t saying too much, but it’s a very hopeful start.

  18. Chicken
    August 31, 2016 at 1:41 pm

    It is kinda funny how software smarties are compelled to live in the bay area, isn’t it?

    Tick-Tock, when does the central banker clock strike 12 ?

  19. kitten lopez
    August 31, 2016 at 2:33 pm

    Mary! Why how kind of you to take the time to write that. Thank you for the kind words and it is a pleasure to read you on here, as well.

    –and i know what you mean about enjoying smart radical ranting angry women, because my new excited daily visit to this site STARTED with my mining for PETUNIA’s comments!

    when i see a good long juicy one from Petunia, i get all excited like getting tucked in for a good story that’s gonna be something i don’t know, about something or somewhere i hadn’t even thought about.

    and CAT LADY:

    regarding the midwest being “cool”? IT ALREADY IS. watch that “a million dollar shack” video. it’s only 23 minutes long. i’m at ground zero of the gentrification and death of the mission, but i was stunned at that video.

    well, THAT’s what’s become of the bay area. it’s dead. no one’s making out. no one’s having a great time. not even the money people. that’s the absurdity of all this.

    but the people who’ve taken over and spread the smart phone everywhere, are the kind of folks who don’t even LIKE people. they’ve stolen what was ours and sold a fraction back to us with facebook, all of it.

    there’s no joy here. only corporate sameness. no one’s happy. people are depressed. the young ones. old ones. rich ones. poor ones. and it’s happening everywhere and no one can do a thing about it.

    so yes.

    the midwest is wildly cool.

    for now.

    but this plague of self-absorbed narcissistic people too afraid of trigger words and confrontation or negotiation and reality as everything in life is a curated resume or short social media posting.

    teenage boys would rather be on their phones than kissing a girl now. no one knows how to talk to each other. they grow into these flabby guys in cargo shorts who can only watch internet porn now.

    yeah. i’ll say the midwest is WILDLY cool now.

    but be careful what you wish for in a world where the only vision is a mall or how to ship you more crap.

    anything “cool” gets raped and left for dead in america.

    cuidado, Miss Cat Lady. be careful what you wish for on this “cool” thing. cool’s a trap.

    it’s better to deflect the riffraff by trying not to be TOO pretty til it’s safe.


  20. Chris from Dallas
    August 31, 2016 at 3:33 pm

    Everyone, be careful of using the San Fran area (arguably one of the worst real estate markets in the country ) to generalize U.S. Real Estate and Real Estate Investors.

    However, if you need to blame someone, then blame your fellow voters and politicians who caused all the results you are complaining about. Especially blame RENT CONTROL which sounds good but which has destroyed housing availability and affordability in every market it was passed.

    TANSTAAFL = There Ain’t No Such Thing As A Free Lunch

    As for real estate investors “being predatory bottom feeders”, you need to get some facts first. The hedge funds, foreign buyers and large greedy investors own less than 2% of the rental houses in the country.

    There are 59.7 million renters of the easily financeable 1-4 unit properties (houses, condos, duplexes, tri-plexes, fourplexes and mobile homes) and 22.7 million landlords in the US. The overwhelming majority are mom & pop landlords with 1 – 4 rentals, and over 50% own just 1. 66% of ALL landlords earn less than $75,000 in total income (including wages) per year! 37% have a high school degree or less.

    As far as professional investors, I have CONSISTENTLY worked 60-100 hours per week for 3 1/2 decades to build up my small software company, and then to transition into real estate.

    I kept my WANTS in check while all my friends were having a great time, saved money, then risked my ENTIRE savings (and more) three times to build my businesses, went so deep in debt that broke would have been paradise, and then worked my way back to success.

    I come from a middle class background, my mom was a nurse, my dad became a high-end “shop-keeper” even though he didn’t finish high school, I started working at 13, paid my own way at college, and through everything else, created software that helped thousands of drug and alcohol addicts, and have spent 2 decades turning ruined buildings into desirable HOMES for working people (not flips and not slums for freeloaders).

    My CUSTOMERS (tenants) are very happy and we have an average tenancy of 2 TIMES the industry average.

    Folks, read the Millionaire Next Door books to see how the vast majority of rich people EARNED AND SACRIFICED for their wealth (only 20% inherited it), move to somewhere affordable in flyover county, and stop blaming others.

  21. Bellinghouse
    August 31, 2016 at 4:51 pm

    I sold my house in San Francisco (Haight / Divis area) several years ago for five times what I paid for it. I know I left quite a bit of money on the table as the prices have gotten even more insane, but at the time I was very happy to be able to sell for 5x what I paid. I had retired a couple years before that, which made the decision to leave San Francisco a little easier. Moved to a nice area of inland Southern California where the homes are much cheaper and it is sunny and warm most of the year.

    What Kitten Lopez said about many San Franciscans being depressed, self absorbed narcissists isn’t far off the mark. I don’t know what brought about that change over the last 20 years or so, but you can really feel it in day to day life there. It is sad.

  22. kitten lopez
    August 31, 2016 at 4:55 pm

    Dear Chris from Dallas…

    (this is long. i used to be a writer back before everyone did it for free, and i put it down to enjoy the sun and come back)

    San Francisco is the Future. your “Millionaire Nextdoor” is CUTE and ANTIQUATED next to the Future of America.

    you know how chainstores and trophies for everyone and trigger words and safe spaces have made self entitled pussies of EVERYONE? imagine every worse insaitable needy bed bath and beyond chronic returner or complainer, moving into and taking over ONE AREA.

    and imagine they hate people. and their worth as an employee is based on how much they can trick people into staying online and starting fights.

    no one believes it until they’re here for a month or two, then you can see the depression take over them. it’s EVERYWHERE. it’s inhumane. but humane for WHOM? as the tech world/employees are ruined and driven mad from breathing their own farts.

    i’ve SEEN IT. it’s not just MONEY. money used to be “to get the proverbial GIRL.” these people–no, this WORLD–has become “what girl?” because they don’t care about a girl…she’s SQUISHY and GROSS…especially if she still has any grown lady PUBLIC HAIR… and pardon me, but that’s just not NATURAL.

    this is the endgame of capitalism and i can’t compare apples and grenades when you cite the adorable “Millionaire Next Door.”

    it’s a whole OTHER WORLD. this globalization of EVERYTHING and these trade agreements that have more authority than governments and foreigners are buying our houses and not even bothering to rent ’em back when we can’t even afford to buy the crap that we don’t even make that they sell us?

    this isn’t the millionaire next DOOR. that’s the PROBLEM. the magnitude is horrific, but what’s even worse is that we’re captured. families and people and you and ME, too separated and atomized to give a fxck about anyone else. i done good. you should’ve you should’ve…

    no. there is NO cookbook. all of you who FOLLOWED said “cookbook” realized it was actually a book on eating PEOPLE, didn’t you?

    and i’m not even talking about how the books are cooked and re-cooked in america; i’m talking THE PEOPLE. the NEXT GENERATION. the CURRENT GENERATION.

    that DeLeon realtor’s kinda right i think, when he says it’s “always gonna be like this.” i had no idea the local money had gone so global. that we’d not only outsourched our own manufacturing, but our own homes???

    i see booms and busts, but when everyone else except americans can afford our own homes, who needs to go to dirty ole WAR??? the terrorism is HERE and hilariously slow. like watching glass liquefy.

    and Petunia tells us the cops got shafted by those whose backs they’ve got? but cops are trained to obey, like veterans. so they won’t change sides; they’ll retire on canned beans and a gold plated middle finger to ease their hemorrhoids on but also have tiny cheap china made american flags on THEIR shopping carts like the homeless veterans often do.

    we’re a country of sadomasochists. like good lovers, we also can switch sides.

    when you’re selling to chinese who can’t even BUY in their own country…and then the cops are gonna defend empty houses and sheriffs are gonna evict citizens to support …THIS???

    and you’re gonna say stop blaming? baby doll… no disrespect for you and your bedtime stories about working hard and deserving it or ANYTHING, but the adults are talking now.

    in america it’s got nothing to do with deserving. ever. it’s a hustler’s game. always has been. ride on someone’s back, kick the dog. burn their house down. you worked hard. like the kennedy family. folks with slaves.

    there’s always an unamortized “cost” someone else is bearing down the line. i’m tired of bearing it. passing it on. it’s not right. especially with all the lies that’re making people feel fine for turning feral.

    and that’s what i’m really saying: all this money has made san francisco FERAL. mean. i’ve seen tech people go mad. people get evicted. and the thing is, middle class folks are TAUGHT NOT TO BLAME and TAKE IT ON THE CHIN. it’s YOUR FAULT, BUDDY. i’ve seen regular sweet middle aged white tech guys go MAD. then get evicted.

    i live in the MISSION> everyone’s going bonkers. taking it out on EVERYONE ELSE since they’re afraid of kicking dogs and getting arrested. (dogs are kings here. above actual children.)

    there is no SHAME. no semblance of HONOR.

    the ONLY economy left in america is fleecing the next sucker. everyone’s fee’ing everyone to death with a million–what used to be “paper cuts” are now machetes.

    grade school teachers are homeless. evicted and living on the STREETS. they’ve covered sidewalks where the homeless were, with parade barricades. permanently.

    this “blame others” cry is also too “code word” for me to bite on. because that’s also code for you believing that life is only allowed to be lived if you can look the part, play the part. screw the rest of you.

    well, the “rest of us” are your kin. see. we can’t talk because i AM talking about love. you’re talking about money. and those with it will always justify how they got it. you HAVE to.

    sometimes i can’t even sleep for the people i’ve terrorized in my youth. guilt is a bitch. and i tend to think most people are good. but we justify too much. that’s where the evil resides, i think.

    when any of us can justify the suffering of another life form. be it animal, plant, earth, future embryos… they’re us. how did we become so atomized and convinced to hunch over screens instead of each other???

    yeah. i went there. that’s why we can’t talk.

    but no matter. i think the world was made for ALL of us. not just those who are in a better position to pay to do and be and get what they want. while we get it for them. cover the mortgage.

    i’m so tired of justifications. justifications are just you stepping over my bleeding body. no. there’s nothing to talk about.

    but i’ll scream anyhow.

    you tell yourself your justifications for why veterans on the street are whiners because they didn’t foist that GI bill into being a mogul. i don’t wanna hear it. i never wanted to be a landlord even when given the chance. it feels dirty. my mother was one. i don’t personally like the position. what the power even did to her. it poisons everything. even and especially love at home and how you see everything.

    this, my dear man… this is why we cannot talk. but even still, freaks like us deserve to be here and live cleanly simply because we were born.

    capitalism’s killing the host but we’re all whores.

    even Cat Lady wants to be cool and thus raped AGAIN. look what they did to the midwest the FIRST time around. isn’t there, can’t there be a BETTER way to LOVE???

    this is why i wanna see more crazy mad pissed off radical WOMEN. because the pissed off guys who know this new america’s bad for their hard ons and any free time to do anything about it with a real HUMAN BEING. but i’m not hearing any WOMEN saying ENOUGH.

    (i’m waiting for my own Lysistrata on all this death of everything beautiful)

    i’m tired of people pretending everything is not a lie.

    as an artist, i know something is brewing under the rocks. not detroit. now that white folks aren’t afraid of black folks any more, in detroit, they’re gentrifying in a more direct-to marketing campaign that starts with commerce (coffee shops/lofts/light manufacturing), totally bypassing the initial waves of artists or gay folks.

    blaming others. that is SO funny. i could’ve thought of something better than all this with that retiring cop’s gold-plated finger up my butt.

    blaming others is so 1950s now. it’s ENDEARING as an argument when you see what the tech industry has done to this area and EVERYONE.

    did you read that they have nap PODS for google employees to nap in? people are driving 4-5 hours to work. there are no other jobs. especially if you’re over 36. well, you could get 3 part time service jobs.

    blame! i’m lucky. i’m in great shape, have my looks still, and two men in love with me and another as my best friend.

    i worry for those NOT LUCKY. and there are a lot. i’m not happy when i know a homeless teacher who got evicted and has to shower at my gym. she disappeared. i saw her go crazy.

    my neighbor below, a guy in tech. lost his MIND. went schizo because he worked all the time and the job tracked him on his smartphone. but his girlfriend said he was paranoid. huh? bosses at crappy jobs are already filming EVERYONE and yelling at their exploited minimuim wage employees for frustrated bitter fun.

    and my my neighbor tech guy snapped and took off his clothes and disappeared into the presidio, a forested area. and no one’s found his body.

    blame. so funny.

    we’re so far beyond that. that’d be like having a tantrum in a closet nowadays.

    i want it all to burn down so something else can spring up out of the ashes.

    artists are made for romping in decay and finding the beauty of mold. and transcending it.

    it’s about envisioning. manifesting VISIONS.

    having the courage to be wrong, embarrass yourself.

    but what when we teach everyone of every generation to court thumbs ups and “likes” and “followers” or they’re so fragile they could commit suicide???


    i want to SAVE, Mr Chris from Dallas.

    i don’t want to plant any flags on anyone’s backs. i don’t want to be a whore, either. america’s become a place for binary choices and making a nation of assholes. everyone’s justification is that we’ve gotta live.

    like THIS? no dice. this sucks. for rich alike. no one’s even getting laid.

    it’s a fxcking “thumbs up” thing.

    when people are happy, they stop screwing over other people and kicking them over their dogs.

    this is no fun. life doesn’t have to be this bad for so many. no matter how much i lose, i try to flip it. i’m doing okay. it’s BETTER for me to ride my bicycle around now that my car finally died.

    i don’t wanna suckle rick people’s babies. i wanna have the time to ride my bike. enjoy the sun.

    no one should suffer needlessly. not even you, Chris from Dallas. i’m sure you’re a sweetheart under all that fancy “justification.”


    Miss Kitten

    • jfl97
      September 2, 2016 at 5:46 am

      this is the most astoundingly beautiful, articulate piece of writing i have read on the internet… thank you very much!

      i got here just incidentally a few days ago via a link from caucus99percent and am very happy to have found this site and this specific exchange. Just breathe!

  23. Petunia
    August 31, 2016 at 7:14 pm


    I grew up in NYC, loved it until I couldn’t love it anymore. Picked up and moved, never looked back. Recently, I had to leave south FL because I was sick and tired of being broke, don’t miss it either. Like a bad marriage, your relationship with the city you use to love, is dead. You need a divorce, badly. Like a bad marriage, it is never going to be what it was, leave. There is a whole world out there and most of the people in it are not in SF or in tech. Who knew?

    • Mary
      August 31, 2016 at 8:27 pm

      But I understand the anger and frustration. It’s about mourning the death of a great city. I grew up in the South, managed to bust out at age 18 and by my mid 20s fast-talked my way into a teaching job in California. Visiting San Francisco for the first time (1972) I found it to be unbelievably beautiful, sophisticated, tolerant, etc.

      I live in Southern California and have not visited San Francisco in years, mostly because of what I hear from residents like Kitty. I actually love LA which I think has retained some of that expansive, optimistic, profoundly liberal quality I always associated with California. But only after sunset, and from a high vantage point, could anyone call it a beautiful city.

      • September 1, 2016 at 12:15 am

        Mary, we actually love living in the City. I swim in the Bay nearly every day. It’s cold, but it’s awesome. The views are beautiful. The weather is great unless you like hot summers. And the food is out of this world…

        In the winter, it’s three hours to go skiing, after I get done swimming in the Bay. Trail heads of Mount Tam are only 30 min away. Lake Tahoe = 3 hrs. Yosemite = 4 hrs.

        It’s a money suck, but it’s a beautiful money suck.

  24. Ryan
    September 1, 2016 at 1:35 am

    Wolf, you are absolutely correct about how this housing bubble has been shifted into the REIT industry. The particular area of REITs to be most concerned about are these so-called mREITs (the “m” stands for mortgage) who use short term financing in vast dollar amounts due to artificial low interest rates and buy mortgages in order to pay out huge yields of 10%. As a CPA, I analyzed the balance sheets of these firms, and I was absolutely shocked. I saw scary, complex credit default swaps on their books and other exotic derivatives involving interest rate swaps. I essentially saw a ticking time bomb waiting to go off.

    Instead of investment banks holding these derivatives, we now have, as you accurately stated, REITs holding the derivatives.

    We are in a housing bubble no question in my mind. The ultra-low interest rates have impoverished everyone, even Google software engineers are being priced out of Mountain View. I grew up in the Bay Area and live with mom and dad, without them, I would be living in a tent.

    The situation is abnormal and quite frightening. There are people who make six figures and cannot afford a home in Palo Alto.

    • Ryan
      September 1, 2016 at 1:39 am

      I must add the short-term financing used by the mREITs is in the repo market, which are short-term borrowings where the mREITs get funds to buy long-term mortgage-backed securities that pay higher interest rates. The business model of the mREITs is absolutely insane.

      When interest rates rise, these mREITs will implode.

      • Petunia
        September 1, 2016 at 9:47 am

        This is the same thing Bear Stearns was doing when it blew up. They couldn’t refinance in the overnight market after doing it for over a decade. The credit disappeared overnight.

  25. HudsonJr
    September 1, 2016 at 10:32 am

    I was in Mountain View and cashed out this summer. I just can’t see the 200K+ down payments for just a condo/townhouse being sustainable. Additionally, retail is being torn down for apartments and condos, people are building on Superfund (old computer waste) sites, and Google is planning on building almost 10K housing units on it’s side of 101. There’s a lot of pressure coming.

    This one could hit hard. With the last round you had people putting down 5% and then just walking away from an underwater home. They were out their 25-30K down payment on a condo, but probably got 6-12 months free rent while waiting for their foreclosure. Not a fun situation, but it could almost be a push financially.

    This round, I wouldn’t want to be someone that just put down 200 or 300K, and then has to deal with a 20-25% drop in market value. It’s OK if you stay employed, but last time it took about 5 years to claw back that 20% drop.

    • Ryan of San Jose
      September 7, 2016 at 11:58 pm

      Mountain View is a pleasant city, it is what South San Jose used to be before it got ran down. Here is the thing. There are roughly 600,000 millionaires in California at this moment. When house payments or rent in Mountain View get past $5,000 per month, the upper middle class is essentially getting priced out and the ones who can afford those monthly rents and house payments are only the millionaire class. Thus one runs into a problem.

      The millionaire class have a lot of leverage in terms of where they can live in California. They can live in a San Francisco Condo, a Menlo Park house, a bungalo in Santa Barbara, a loft in Beverly Hills, or a mansion in Newport Beach. Why in the hell would a millionaire faced with those choices want to live in Mountain View?

      I love Castro Street, but the rest of Mountain View is standard neighborhoods and In and Out Burgers.

      So my question is, when these idiot landlords and home sellers price out the NASA engineer or Google software engineer, do they really believe a millionaire faced with all those options, is going to rent or buy a home in Mountain View?

      I rest my case. We are in a housing bubble. Another indicator is people moving into the industrial wasteland known as Vallejo.

  26. kitten lopez
    September 1, 2016 at 12:39 pm

    good morning our dear Mr Wolf—
    regarding your defense about actually and stubbornly caring about this beautiful wild town: YES YES and YES!

    Miss Mary–
    even though i’ve lived in SF almost 23 years, i actually have always kinda liked LA. there are lots of creative odd balls and dreamers and a mix of races and classes like rarely in one place anymore.

    and Miss Petunia–
    that’s the thing about being an american that has killed this town: the expectation of human portability in lieu of putting down roots and belonging to a community. and not just because you bought into it.

    because i got here as an adult in my twenties (i’m 49 now), i always felt like a newcomer because i didn’t go to high school here, or have generations of family history here.

    but when i saw people casually getting evicted so that landlords could all start renting on airbnb, our neighborhood got creepy good and fast.

    i got it.

    when owners started evicting folks and scaring the ones left and cutting down old beautiful trees to show how much space is for condo building, i refused to feel nothing while those of us left mourned the dead trees like kin. because they were our kin. we all grew together.

    i never GOT that until i saw how quickly money can kill a long-standing community, the look of it, the feel of it. terrorize it. all in a snap. like natural, accidental sacred beauty lost in a flicker of a fire.

    but just as your posts tell, you have to keep MOVING. i find that tragic. especially because you’re actually SO cool. people should KNOW you. LEARN from you, Miss Petunia. especially confused young girls who don’t know how to be real women anymore.

    but the thing is: there’s nowhere else to move to now. this infection has spread everywhere in the western world where everything/everyone is for sale. there’s nowhere for me to move in reality, but also figuratively. part of staying here and loving this town, is me stepping up for once. trying to react truthfully to how i feel, not suck it up like a “happy face” californian i want to punch as a girl born in nyc.

    as americans we’re taught we only belong anywhere if we “own” it. but after all of my time here, it’s my HOME.

    i have to admit that this website has made my existential crisis over our “NOW” that much more overwhelming.

    i used to raise my fist for revolution. but now that i’ve read this site a couple of weeks, rebel against WHOM???

    when Mr Chris from Dallas and DeLeon and the cops along with just enough folks making a dollar off this “deal” of selling off the rest of america like a fire sale, who consider it their hard working deserved natural god-given part of the american CHARTER, who are we really fighting?

    people wanna put walls up for the mexicans but let everyone flip our houses into astronomical absurdity???

    who do you fight when the police who’re to protect and serve the citizens are killing them to protect neglected property and we’re being sold out by our own neighbors first???

    civil war?

    i don’t even see that anymore. i see some kind of passive aggressive civil war. a degeneration of values and kindness.

    there’s nowhere to move. go. run to. i’m against the wall. financially, existentially, and physically.

    but why should we who have less, through no fault of our own when this country’s economy DEPENDS on others’ need and destitution, constantly move based on others’ bored or insatiable whims?

    this greed is crazy values when our families and children are spread all over the country and we’re facebooking old friends we lost touch with on purpose the first time around. (remember?)

    San Francisco is worth fighting and screaming and having tantrums over losing. a lot of things are. (remember!)


    • Brasquey Chutter
      September 2, 2016 at 1:57 pm

      > there’s nowhere to move. go. run to. i’m against the wall. financially, existentially, and physically.

      I recommend looking up Henry George; in SF, he predicted this all over 100 years ago. In time, labor and honest business cease getting their fair return, and all the gains go to landowners. And in time, there isn’t any land left…

      Think of Monopoly, how it feels at the end of the game. And that’s appropriate, b/c it was invented by a follower of Henry George, Liz Magie, who wanted to demonstrate these principles in action. We’re now living it.

      The solution first involves getting rid of Prop 13. It can’t happen soon enough.

  27. Sira S
    September 1, 2016 at 1:02 pm

    Moving from Palo Alto to Detroit may not be feasible. But you *can* move from Palo Alto to say Saratoga, or Mission San Jose in Fremont, or to Hayward Hills. What costs $5M in Palo Alto might cost about 3.5M, 2.5M and 1.8M respectively in those places, and they are not that far from Palo Alto (18-25 miles or so)

    • DKing
      September 1, 2016 at 2:35 pm

      Agreed, but the commute from those places to PA or Menlo Park can be brutal. It sounds like you are from the Bay Area so you probably already know that. But I’ve found that many people from outside California who don’t know the BA assume a distance like 20 mi will take about 20-25 mins which isn’t always the case. I do think that this helps drive up the housing cost – a shorter commute can mean an extra hour or two a day not in a car or public transportation. And sometimes more (e.g., from the Central Valley to the BA).

      One of my colleagues moved here from the East Coast and lives in Albany. Before someone set her straight she thought a commute from Albany to Stanford would be feasible. It’s not, unless you want a bullet in the brain every day.

  28. CentralScutinizer
    September 1, 2016 at 2:25 pm

    Housing prices are inflated 300% + minimum irrespective of location. Housing prices have a long way to fall. Here in Seattle and Vancouver, they’re 400% higher than long term trend.

    Why buy it when you can rent it for half the monthly cost? By later after prices crater for a 65% less.

  29. Ryan
    September 1, 2016 at 2:40 pm

    I live in the miracle of the Bay Area San Jose and, there is a high-rise luxury apartment complex being built in North San Jose on 1st Street near the airport.

    It is an awfully nice complex but who is going to afford to live there? The tech millionaires want to live in Menlo Park or San Francisco. Not San Jose. The middle class forget about it, they cannot afford it.

    I have been seeing lots ads on the side of the light rail for new apartment complex. Apartment glut?

  30. dantheman
    September 2, 2016 at 2:40 am

    What is happening is that the prettiest, most interesting, safest, benign-weather blessed, nicest places are very very expensive. Palo Alto is one of them. Shitty places are still cheap. When wealth and income disparities are as vast as they are in the US, it is bound to create this extreme contrast of paradise vs shitholes.

  31. Akam15
    September 6, 2016 at 10:24 am

    Fact is that the median home price is still UP year over year. You can say that homes are wildly overvalued in Palo Alto or Vancouver or San Fran but facts are facts. It may feel lofty but people are still buying homes at these nose-bleed prices. Just fewer people are buying. But that probably wouldn’t get you the headlines you want.

    • September 7, 2016 at 12:07 am

      For example, in August, the median home price in San Francisco has fallen $10,000 from March and is now flat year-over-year.

      Condos are in deeper trouble. Condos are the majority of the market in SF, and all the construction taking place is condos and apartments. The median condo price is down $20,000 from March and from August last year – so that’s down 2% YEAR-OVER-YEAR.

      And this is just the beginning. That’s always how home-price declines start – with people denying it!

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