28% of what? The difference between the yearly turnover ratios for CA and the rest of the country?
Yes. You asked me, "So how much lower is existing housing turnover in CA compared to the rest of the country," to which I replied, "28%."
Turnover for the whole country reached 5% in the last few years but that figure includes CA. Turnover ratios are figured by dividing the number of existing homes sold by the total housing stock in a given year. If CA is 28% lower than the rest of the country then it means the US without CA is higher than 5%, a lot higher than 5%.... which is doubtful since 5% is a figure reached rarely. At the height of the Japan bubble, 5% of the housing had turned over in the previous 5 years (as opposed to the one year we use to calculate turnover ratios).
Consider that CA accounts for a huge percentage of US existing home sales as measured by units and sales totals every single year.
Grace, you use the words, "A lot higher than 5%" and "Huge percentage of existing home sales." What's "a lot higher than 5%?" 10%? That would be a lot higher. Let's do some math to see how much higher turnover in the rest of the country might be if turnover in CA was, in fact, 28% lower than the rest of the country. I will be making some assumptions about CA household formation, so you might just stop reading there because you can't deal with it when I make as assumption.
CA has 35M people. The U.S. has slightly under 300M. For the first part, let's assume that CA has, on average, the same number of homes per person as the rest of the U.S. You said that turnover for the whole U.S. is 5%. If CA was 28% lower, then this is the math:
.72 T(35/300) + T(265/300) = 5
T = 5.17 . So, if CA forms households at the same rate as the rest of the country, then the rest of the country will have to have the huge turnover of 5.17 compared to 5 for the whole country, and CA will have a turnover of 3.7%. Still quite high given the Japanese example you quoted me.
How 'bout if CA has twice as many homes per person versus the rest of the country (a beach house and a mountain house), then the rest of the country must have the whopping turnover of 5.31%.
So where did I get this 28% number? From the incredibly comical book Bogus Facts that Annoy Grace Zaccardi. It's not on the web. Try the Library of Congress, ISBN:5612346. Hey, the Berkeley professor made the claim more recently than I that Prop. 13 slows housing turnover. Did you write him? Maybe I will.
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