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San Francisco, I Love You But You’re Bringing Me Down

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Re: San Francisco, I Love You But You’re Bringing Me Down

#401

Post by losvedir »

mwfunk wrote: post #287
hoov wrote: post #219

Earlier quoted context omitted.

> I've never understood this crazy, if not outright insane obsession with home ownership. And, I don't understand why so many people on HN seem to think it's insane. I'd like to be more in control of my environment. I don't want to be at the whims of a landlord, particularly in the future, when I have children. I want a place that is mine to customize as I see fit. I don't want to have to ask if I can paint, I want t…

I'm guessing that there's nearly a 100% correlation between the people accusing prospective homeowners of having an "insane obsession" and people who live in apartments in SF. SF is one of my favorite cities in the world, but there are a LOT of downsides to it. I find that a lot of the people I know who live there adopt a borderline Stockholm Syndrome attitude about those downsides. If you live in SF, you have easy a…

> I'm guessing that there's nearly a 100% correlation between the people accusing prospective homeowners of having an "insane obsession" and people who live in apartments in SF.

Ha! It seems that statement is based on... nothing?

I'm pretty militant anti-home ownership. This is partly to combat the omnipresent, uniquely American, societally-negative idea that you really ought to dream of owning a home some day. It's also some sour grapes because of the insane tax treatment home owners get and the difficulty in renting good houses because of it. How is it in the government's interest to encourage that behavior?

I live in a cozy little apartment in Boston and don't really expect to own a home for a long time, if ever.

From a theoretical perspective you should expect home ownership to be about as economically beneficial as renting. There's No Such Thing As A Free Lunch and it drives me crazy that people think lottery tickets pay off, multi-level marketing schemes are a good idea, and buying things "on sale" saves you money.

The only reason home ownership appears to be a better idea, is because people ALWAYS fail to look at it in the risk-adjusted sense.

There's very little special about real estate as an asset class over any other investment vehicle. And buying ANYTHING on so much debt that you're levered up 10x is insane. That implies a 10% depreciation wipes out ALL of your investment.

I have a degree in Economics from MIT and worked in finance for 2.5 years so I tend to see things in that light. But no one talks about home ownership that (correct) way, and it frustrates me that there's so much pressure on people with little financial knowledge to make this massive un-diversified bet without understanding of the implications.

If someone gave advice to an unsophisticated median american to go out and buy tons of stock options, or short sell stock on margin, they'd be rightly chastized. It's unethical. But no one seems to bat an eye when the exact same advice is given regarding real estate.

And that's why the real estate crash was such a disaster trapping so many people in crushing debt.

If America had a sane perspective, wealthy investors who can afford big bets on real estate while still being diversified would take the huge risk in buying a several hundred thousand dollar asset, and middle income earners would have a much easier time renting decent homes in good areas.

So, no, it's not about "fetishizing" homelessness or anything inane like that; it's about recognizing a terrible corrupting influence in America and doing our best to correct it.

Re: San Francisco, I Love You But You’re Bringing Me Down

#402

Post by 7Figures2Commas »

dllthomas wrote: post #389
7Figures2Commas wrote: post #376

Earlier quoted context omitted.

> If you rent, the cost of staying may be completely out of your control. Indeed, it may not even be possible. That's arguably a feature, not a bug. Rents generally don't skyrocket without cause, and they usually don't skyrocket in isolation. If you're living in an area where rents are increasing rapidly and your income isn't keeping pace with the cost of living (of which rent is typically a substantial component), y…

> Yes, these individuals might be able to sell their homes at substantial profit, but they'll still have to move once they sell. They have to move if they were renting, too, and would be have less money (if they didn't leave the very instant rent rose at all) instead of more. Of course, that's just saying that it's better to be long an asset when its price jumps. Also, if your work doesn't tie you to a region and you…

> Also, if your work doesn't tie you to a region and you've purchased a house, and rents are high, you can always rent out your house instead of selling it.

That's a couple of big ifs, but even so, unless you have purchased a house as an investment with the intention of renting it out, this is another one of the rationalizations that prospective home buyers use to convince themselves that they're making a smart decision.

As I noted in one of my other comments, many home buyers know very little about the local market they've bought in to. Professional investors and major institutions have purchased hundreds of thousands of homes across the country that they are planning/trying to stabilize and rent out. To my knowledge, Blackstone owns more than 26,000, American Homes 4 Rent owns around 14,000 and Silver Bay Realty Trust owns more than 5,000. These are just a few of the major players. There are countless other smaller players, some of them foreign, doing the same thing on a smaller scale.

It's quite sensible to question the impact this will have on rents in the areas where this activity is most prevalent as the homes are stabilized and rental inventory increases. And one should not ignore the impact these purchases have had on housing prices in these areas.

Net-net: assuming you're comfortable being a landlord, which can be a trying job with even a single property, market conditions and trends vary so significantly that it's simply not credible to state "you can always rent out your house instead of selling it." Heck, as a lot of people found out not too long ago, at times it can be impossible to do either.

Re: San Francisco, I Love You But You’re Bringing Me Down

#403

Post by drivebyacct2 »

hayward2 wrote: post #98
king_jester wrote: post #74

Earlier quoted context omitted.

Software engineering is not a very middle class occupation, as you can easily earn amounts more than the average middle class family as a single worker, even in areas that are not tech hubs. > I don't understand why tech workers in the Bay Area feel guilty about receiving 'high' salaries of $100 - $200k/year. This is not a lot of money... People on Wall street laugh at these amounts. 100-200k a year is a lot of money…

I'd agree with you if I was referencing some mysterious elite who lucked into their positions or had ivy league connections. I'm talking about my friends from college who had average grades at a top 30 small private school on the East Coast. Several of the ones who went into finance make more than I do, and some a LOT more. I have friends who frequently clear $300k with bonuses in very average wall street jobs. They…

You could have just written "I'm not as entitled as those bigger brats so NUH UH"

Re: San Francisco, I Love You But You’re Bringing Me Down

#404

Post by ryanflorence »

ahoyhere wrote: post #338
enraged_camel wrote: post #164

Earlier quoted context omitted.

>>I'd love the city I'm sure, but after glancing around I've come to the conclusion that home ownership is unthinkable to anyone who hasn't had a cash-out event. I've never understood this crazy, if not outright insane obsession with home ownership. Why does everyone want to tie significant amounts of their lifetime earnings into physical property that historically has had very low appreciation in value? It's like pe…

Some of us value permanence. I own my house, and I have zero intention of ever selling it. It's mine, mine, mine, mine. There is an incredible feeling in owning a home that you love and plan to spend your life in. We get to plan the changes we'll make over the next decade. We can plant a tree and watch it grow. We can truly unpack our stuff AND our lives… which it's hard to ever do when you rent; most people I know m…

Completely agree on all points.

Also, community. My wife was sick in bed for 3 months, our neighbors came and watched our kids every morning from 8:00am-12:00pm so I could work and continue to support my family. You only get that from a neighborhood of homeowners.

Re: San Francisco, I Love You But You’re Bringing Me Down

#405

Post by ahh »

patio11 wrote: post #375
ahh wrote: post #364

Earlier quoted context omitted.

Sadly, I don't run a company, and I'm not in charge of anything high status or visible. I do performance optimization and design threading infrastructure to dramatically improve the experience of writing high performance system software. I think this is pretty valuable, but there's no way to put it that seems high status to non-computer people. Should I just quit and start a company selling shit because that'll look…

Can you describe that in terms of an important system, somewhere, which would not exist but for your contributions? If so, more on that story, less on the technical detail. If on the other hand none of your work ever gets used in anything important, then that's a non-BSy reason to change what you're working on. (Believe me -- been there, done that.)

Nothing "wouldn't exist." They'd just cost X% more or run Y% slower, which at our scale runs to $large-number, and I personally think that's valuable.

I do get your point though, and I do wish sometimes I worked on something that wouldn't exist without me.

Re: San Francisco, I Love You But You’re Bringing Me Down

#406

Post by wyclif »

JonFish85 wrote: post #281
base698 wrote: post #270

Earlier quoted context omitted.

What, exactly, is "crazy" about it? As a renter, you don't control your own destiny. You're at the whim of your landlord. As a home-owner, or better yet, a property-owner, you have much more control over your living situation. Don't like the paint color? Change it. Don't like your stove? Get a new one. Want to plant some new flowers? Go for it. Want to move to San Francisco to work at a new startup? Oops, you have a…

"Being mobile is a lot better." For one very specific subset of society. For other people with different priorities (friends, family, what-have-you), owning a home might be "a lot better" for them.

Yes, specifically people with wives and children like me. This is what's driving the property market in cities like Austin and Boulder. Talent is moving there because they can work for a startup and still have a healthy family life, work/life balance, and non-insane commute.

Re: San Francisco, I Love You But You’re Bringing Me Down

#407

Post by cbosch »

davidw wrote: post #185
johnward wrote: post #25

I wouldn't underestimate the effects a lack of sunlight will have on you. This coming from a part of the country that receives a little bit less sunlight that Seattle (Pittsburgh area). Seasonal depression can really make life suck. I'm also probably a little bit upset because it's been raining for something like 12 days straight.

I'm a native Oregonian - born and raised in the Willamette valley. The weather made me want to get the hell out, though. It's not that it rains that much, it's just that it's gray and bleak so often. During the winter, it's usually around 5C or maybe up to 10C (that's about 40-50F). The cold and drizzly weather is absolutely miserable if you like the outdoors, because you can't really do much. Too warm for snow and "…

ha! that's wolf creek road in eugene. an awesome road for cycling. I live in san francisco but I visit my friends in eugene in july. luckily, in july, the weather in eugene is typically superb.

I think it'd be pretty tough for me to handle all the grey during the rest of the year.

the bay area has a lot of paradise weather - I grew up in marin - and when I went to the east coast for school I had trouble with the grey and interminable springs. it just sucked in comparison.

Re: San Francisco, I Love You But You’re Bringing Me Down

#408

Post by tosh »

ahoyhere wrote: post #338
enraged_camel wrote: post #164

Earlier quoted context omitted.

>>I'd love the city I'm sure, but after glancing around I've come to the conclusion that home ownership is unthinkable to anyone who hasn't had a cash-out event. I've never understood this crazy, if not outright insane obsession with home ownership. Why does everyone want to tie significant amounts of their lifetime earnings into physical property that historically has had very low appreciation in value? It's like pe…

Some of us value permanence. I own my house, and I have zero intention of ever selling it. It's mine, mine, mine, mine. There is an incredible feeling in owning a home that you love and plan to spend your life in. We get to plan the changes we'll make over the next decade. We can plant a tree and watch it grow. We can truly unpack our stuff AND our lives… which it's hard to ever do when you rent; most people I know m…

Wow, thanks for this post Amy.

Re: San Francisco, I Love You But You’re Bringing Me Down

#409

Post by coolsunglasses »

jdminhbg wrote: post #256
ececconi wrote: post #55

One of the things that I love about living in Tampa while doing technology consulting traveling around the country is the cost of living. The cost of living is so low that I can afford to do anything that I want to do while still having a lot left over for savings.

Yeah, I don't entirely understand why people are so fixated on California uber alles for tech jobs. It's so easy to do development from anywhere, especially a US timezone, that it boggles my mind that people will pay $3k for a one bedroom in SF to make low six figures at a startup and act as if that's the only choice available. Rent is high in SF because more people want to live there than there is room for. If you w…

I'm here for the startups and investment money. I don't want to consult anymore.

Re: San Francisco, I Love You But You’re Bringing Me Down

#410

Post by ChrisNorstrom »

Don't worry the housing prices will drop off a cliff after the up and coming massive earthquake finally hits San Francisco. It's guaranteed to happen, it's just a matter of when. You'll have a whole new set of problems but a lot of people are going to haul ass out of there and rent will drop. And the subsequent effects will fix a lot of the real estate problems. First, whatever the earthquake doesn't destroy, the fires or building demolitions will. In the ashes or rubble where the old low-rise "historic" buildings stood, new buildings will finally be built and you can bet your money that they're going to be high density. NIMBY (not in my back yard) residents will have so many other matters to attend to that they won't be so strict about keeping San Francisco looking the same as they remember it as kids so progress will be easier.

With destruction and death, comes renewal and new life. Fitting for the startup capital of the world actually.

I wish everyone the best of luck surviving and may the death toll be as minimal as possible.

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