Silicon Valley exodus: Bay Area tech companies leaving for Texas • Hacker News Board

Re: Silicon Valley exodus: Bay Area tech companies leaving for Texas

#321

Post by spamizbad » Tue, Dec 15, 2020, 3:51 PM UTC

refurb wrote: post #273

spamizbad wrote: post #254

Earlier quoted context omitted.

I live in Chicago so I know that feeling. We’ve been on the cusp of dying since the 1970s.

Chicago, while not dead, is a fraction of what it used to be. While it used to be at the vanguard of US cities, when is the last time you’ve heard it mentioned in national news in a good way? Not all cities end up like Detroit. Some just fade into irrelevance.

That's not what the doomsayers were predicting. They were expecting a detroit-style implosion since the 1970s, suggesting such an event was just a year or two around the corner.... for the last 45 years. Much different than "This city's influence will wane as other metros rise and grow"

Incidentally, Zillow has Chicago and the surrounding metro area posting the highest growth in home value (source: https://www.chicagobusiness.com/residential-real-estate/chic...)

Re: Silicon Valley exodus: Bay Area tech companies leaving for Texas

#322

Post by BowBun » Tue, Dec 15, 2020, 3:54 PM UTC

> the cost of housing is one-third of Bay Area prices and the absence of a state personal income tax amounts to a 13.3% raise for top earners.

This point always makes me laugh because anyone who lives in affluent TX neighborhoods knows your property tax is _enormous_ and usually makes up for a majority of state income tax you save. They still need to pay for roads and schools, right?

Re: Silicon Valley exodus: Bay Area tech companies leaving for Texas

#323

Post by bluedevil2k » Tue, Dec 15, 2020, 3:56 PM UTC

BowBun wrote: post #322

> the cost of housing is one-third of Bay Area prices and the absence of a state personal income tax amounts to a 13.3% raise for top earners. This point always makes me laugh because anyone who lives in affluent TX neighborhoods knows your property tax is _enormous_ and usually makes up for a majority of state income tax you save. They still need to pay for roads and schools, right?

Very true - here in Round Rock (outside Austin), it’s about 2.2% of the home value.

Re: Silicon Valley exodus: Bay Area tech companies leaving for Texas

#324

Post by jeffbee » Tue, Dec 15, 2020, 3:56 PM UTC

gedy wrote: post #317

jeffbee wrote: post #285

Earlier quoted context omitted.

Prop 13 caused the bubble in the first place.

No, Prop 13 was in response to people being "taxed out of their homes" . Inflation, low interest rates, and turning homes into an "investment" did more to make the bubble.

Prop. 13 allowed people to advocate for exclusionary development policies, capture all of the land value increment of those policies, while at the same time being totally shielded from the taxes on their windfalls. The timeline of California land use abuse was that first came zoning, downzoning, historical preservation, and all the other anti-housing controls. Then came rent control and Prop 13, both of which act to shield incumbents from the consequences of their own actions.

Re: Silicon Valley exodus: Bay Area tech companies leaving for Texas

#325

Post by cam0 » Tue, Dec 15, 2020, 3:59 PM UTC

bluedevil2k wrote: post #323

BowBun wrote: post #322

> the cost of housing is one-third of Bay Area prices and the absence of a state personal income tax amounts to a 13.3% raise for top earners. This point always makes me laugh because anyone who lives in affluent TX neighborhoods knows your property tax is _enormous_ and usually makes up for a majority of state income tax you save. They still need to pay for roads and schools, right?

Very true - here in Round Rock (outside Austin), it’s about 2.2% of the home value.

For quick comparison it's 1.18% in San Francisco.

Property tax bill on a $2.7m house in SF is ~$32,400/yr, and the property tax bill on a $1.5m house in Austin would be around ~$33,000/yr.

Re: Silicon Valley exodus: Bay Area tech companies leaving for Texas

#326

Post by function_seven » Tue, Dec 15, 2020, 4:00 PM UTC

BowBun wrote: post #322

> the cost of housing is one-third of Bay Area prices and the absence of a state personal income tax amounts to a 13.3% raise for top earners. This point always makes me laugh because anyone who lives in affluent TX neighborhoods knows your property tax is _enormous_ and usually makes up for a majority of state income tax you save. They still need to pay for roads and schools, right?

The property tax being double is still cheaper when the housing costs are 1/3 though, right?

I guess if you Prop 13'd your way into a low assessment, then the math doesn't quite work that way, but for someone who bought a Bay Area house recently, then moved to Texas, the net difference is still a tax reduction.

Re: Silicon Valley exodus: Bay Area tech companies leaving for Texas

#327

Post by api » Tue, Dec 15, 2020, 4:00 PM UTC

qppo wrote: post #288

api wrote: post #246

Earlier quoted context omitted.

I've heard this and the general borderline unenforceability of "we own all your work, even during off hours" clauses in employment contracts as a major reason that the center of innovation shifted from Boston and the East Coast to Silicon Valley and California. Boston should have been Silicon Valley. It had all the education and a much deeper history of innovation. It also could have been down in New Jersey where Bel…

The first thing that any state should do to make itself a new tech hub is create strong protections for workers so they can freely move to different companies or found their own. Pro-labor is not anti business, quite the opposite here. But it's never understood that way.

The fundamental problem is governments making laws to serve existing companies rather than to help create new things that don't exist yet. It's "hold on to what you have" vs creating something new.

Re: Silicon Valley exodus: Bay Area tech companies leaving for Texas

#328

Post by pembrook » Tue, Dec 15, 2020, 4:01 PM UTC

vmchale wrote: post #293

11thEarlOfMar wrote: post #24

This general topic seems to come back into focus on a regular basis on HN (last time, 1 week ago). People have been leaving SV in numbers for the 30 years I've been here, always citing traffic & cost of housing as the primary reasons. Though this time, you could add decriminalization of petty crime. Nonetheless, the population growth remains net positive. The fundamental design of the Internet was to be robust agains…

Universities help I think. Stanford, Berkeley &c. Many great public universities and many great universities!

The east coast has entire Ivy League and yet no Silicon Valley. Also, how do you explain Seattle?

Re: Silicon Valley exodus: Bay Area tech companies leaving for Texas

#329

Post by kelp » Tue, Dec 15, 2020, 4:02 PM UTC

gedy wrote: post #261

Ericson2314 wrote: post #257

Traditionally this stuff has meant race to the bottom in terms of taxes and regulations. That is terrible. But if it instead helps wake up California to actually rezone, densify, remove prop 13, and improve social services, that could be quite good.

Prop 13 is one of the few reasons many could consider staying in California, vs having to pay property taxes on the bubble prices here. Property taxes do go up at what amounts to reasonable inflation numbers.

The most compelling argument I’ve heard in favor of continuing prop 13, from a good policy perspective is that it lets people stay in their homes. But couldn’t we achieve the same thing by means testing property taxes?

As it is now, the tax rate is set basically based on how long you’ve owned your property. I could be making $$$ and pay very very little. While my neighbor who bought more recently but earns less pays more. This seems deeply unfair to me.

Prop 13 also creates a very volatile tax base for local governments, contributing to the frequent budget issues we see in CA.

Means testing property taxes might make them more volatile than in states that don’t do that, but I can’t imagine it’s worse than the current situation.

Additional prop 13 sets up incentives so homeowners at all income levels are discouraged from selling and moving. And discouraged from allowing more housing supply because they only benefit from increasing housing costs. Taxes that go up with home value tend to blunt some of the benefit of that increasing value.

Re: Silicon Valley exodus: Bay Area tech companies leaving for Texas

#330

Post by njarboe » Tue, Dec 15, 2020, 4:04 PM UTC

BowBun wrote: post #322

> the cost of housing is one-third of Bay Area prices and the absence of a state personal income tax amounts to a 13.3% raise for top earners. This point always makes me laugh because anyone who lives in affluent TX neighborhoods knows your property tax is _enormous_ and usually makes up for a majority of state income tax you save. They still need to pay for roads and schools, right?

Which is great. A high property tax keeps the price of housing down (what people will pay for a house is cost per month, basically mortgage plus property tax), makes people want to have new housing built so that housing prices don't go up, and promotes a general attitude of anti-NIMBYism. Just the opposite of California with its low property tax and very aristocratic prop 13 problem.