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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Jim McMannis who wrote (12548)	8/17/2003 9:11:29 PM
From: Lizzie Tudor	Read Replies (4) \| Respond to of 306849

I guess Tradelite is saying...take your business to another place where the cost of doing business is less. Isn't that what is happening? You could get the same people for 40 to 50k and both you and the employee would be better off. No? Yeah, I read that argument earlier. A few points are- silicon valley is here in large part due to the universities stanford and berkeley. These institutions have a 100+ year history with technology. The people who lived here in 78 that passed prop 13 did not invent stanford and cal, in fact, given the productivity figures and economic picture of the time (the 70s), and argument can be made that the generation that passed prop 13 were just lazy folks looking to govt to solve their problems (inflation and low productivity). So they do not "deserve" to be here, quite the contrary in fact. Now the question of moving. With prop 13, the move argument won't work- unless we move out of the state. Within CA, because high tech wealth is so great, going into a new suburb with a tech company that becomes successful will, within a few years exhibit the same characteristics of Palo Alto (on a lesser scale). I have seen this first hand with the San Mateo area, and Pleasanton where Peoplesoft is. Pleasanton used to be way out in the boonies, a farm town. It was cheap which is why Duffield built it there. As soon as psft started generating millionaires the same exact thing started to happen, all the prime properties around psft started to get really expensive because the residents (whether they were affiliated with psft or not) knew they had a good thing and refused to leave. Had we had normal free market dynamics, the prices in the area would rise and psft executives would buy the houses from the locals and they would go off elsewhere with their tidy profit, or alternatively they could rent and pay higher taxes to the city for the increased services pleasanton must provide now that it is no longer a farm town. But no, instead the long time owners choose to rent their properties and pocket the money and pleasanton is broke. This is california, period, the way it is for business unless we get rid of this arcane property tax system. So where else can tech go... not nevada really, although it is cheap the universities and airports aren't quite enough, plus the sin-city atmosphere. Washington is good and as you know there is a tech hub there, also Austin. These are direct results of property issues in CA imho. Anyway my feeling is that N California is the right place for SV with the history, universities, the defense labs (Lawrence livermore and berkeley), stanford linear accelerator and all. The state of CA does not want SV to pick up and move, so we need to figure out how to make the property tax laws work for all and not just some people who happened to cash in as a result of some arbitrary law. JMO.