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

To: Live2Sail who wrote (43762)	10/27/2005 11:44:27 PM
From: Lizzie Tudor	Read Replies (1) \| Respond to of 306849

have you ever looked at San Bruno? What do you think of that. I have a startup company who is located there. I drove around the neighborhoods and was really impressed, I think the secret is , that it was an old community built out PRIOR to 13. Its a lower income town as far as the bay area is concerned, don't get me wrong. But maybe potential there?

To: Live2Sail who wrote (43762)	10/28/2005 12:02:59 AM
From: GraceZ	Read Replies (1) \| Respond to of 306849

Of course prop 13 provides an incentive to stay put because the house you have is worth more to you than the one you can buy with the same money (read this as the discount you need on the second house or the premium on the first, in order to compel you to move), moving up is never equal. The same could be said for keeping a house whose problems and costs you are familiar with, the considerable transaction cost involved in selling one residence and buying another makes it better financial sense to simply buy one house in your lifetime and live there the rest of your life and many people would be far better off if this was how they acted..... but this isn't what most people are doing. It may be surprising to you that so many houses change hands in CA every single year....more so than other places that don't have that kind of tax treatment and that's what you have to investigate, what it is that has made move up buyers blow past that barrier. CA RE has been so persistent in it's moving up ahead of inflation and income growth that there has to be some other force at work that you aren't giving the credit it deserves. OTOH moving isn't always a financial loss because houses depreciate and moving from an existing house to a new one can solve a world of problems (or create all new ones). It is frequently far cheaper to move to a new house that has all the latest bells and whistles than to a conduct a major renovation. But this is only true in a location where they don't put an undue burden on building new. Some people still won't do it because they are risk averse and building new involves risk and cash up front.