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Silicon Valley's housing crisis, in one sentence

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Re: Silicon Valley's housing crisis, in one sentence

#171

Post by WWKong »

djcapelis wrote: post #165
some-guy wrote: post #157

Earlier quoted context omitted.

2) ROI isn't the most important thing about a home. I agree, though I imagine the people who can actually afford a home in SF in 2016 feel differently. Edit: clarity

Doubt it. Some friends of mine have bought homes here and none of them cared that much about ROI as a large factor in their purchasing decisions. They were buying a home . You gotta be at least a little crazy to live in SF. I hope that's still true. It isn't particularly financially responsible, so you have to want to be here. That means the people who live here generally aren't doing it for their ROIs.

Are you sure finances is not a factor for most people making the biggest investment of their life? Well, if it isn't they are in for massive joy as every single person I know who have invested in a home sometime back have gotten really really good ROI (if they survived the housing crash).

Re: Silicon Valley's housing crisis, in one sentence

#172

Post by phlakaton »

phlakaton wrote: post #166
guyzero wrote: post #129

Earlier quoted context omitted.

Well as an actual Sunnyvale resident the fears are slightly more rational: cars on roads, kids in schools and no increase in infrastructure to go along with the thousands of new residents. Some of the buildings have less than one parking spot per apartment which in theory is supposed to help encourage people to use transit, in practice people fear it will lead to more street parking in adjacent residential neighbourh…

Yes, but do the good people of Sunnyvale vote for infrastructure projects? Do they allocate enough funds for building that infrastructure, and/or do they have rational expectations for where those funds will come from? Even if you fear putting the cart before the horse, it simply begs the question of why you don't already have the horse. And the answer to that, I think, is back to what was stated above: fear of chang…

(BTW, I don't really mean to pick too much on Sunnyvale in particular here. The increased demand on housing and infrastructure can't be solved by Sunnyvale alone. It's a massive regional problem, if not a state problem, and the entire region is falling way short of meeting its needs.)

Re: Silicon Valley's housing crisis, in one sentence

#173

Post by guyzero »

phlakaton wrote: post #166
guyzero wrote: post #129

Earlier quoted context omitted.

Well as an actual Sunnyvale resident the fears are slightly more rational: cars on roads, kids in schools and no increase in infrastructure to go along with the thousands of new residents. Some of the buildings have less than one parking spot per apartment which in theory is supposed to help encourage people to use transit, in practice people fear it will lead to more street parking in adjacent residential neighbourh…

Yes, but do the good people of Sunnyvale vote for infrastructure projects? Do they allocate enough funds for building that infrastructure, and/or do they have rational expectations for where those funds will come from? Even if you fear putting the cart before the horse, it simply begs the question of why you don't already have the horse. And the answer to that, I think, is back to what was stated above: fear of chang…

There is a new school being built but it's in an area that's already underserved and bussing kids pretty far. SCUSD (much of Sunnyvale is in the Santa Clara Unified School District - why school district boundaries are disjoint with municipal boundaries around here I can't explain) passed a $419M bond measure in 2014 (Measure H) which includes classroom expansions.

Sadly it's not quite so easy to increase road capacity as unlike a real city where you can add residents without adding vehicles, it's simply not possible to add residents in the 'burbs without adding an equal number of cars on the road. I'd love for it to be otherwise, but the sprawl can't be fixed just by rezoning lots for higher density.

I think it's more an issue of poor planning than fear of change (although yes, some residents want the city to be a 1966-themed amusement park). Hanlon's Razor and all. Personally I have no attachment to the sentimental issues around Sunnyvale but my proposed solution of levelling half the city and rebuilding it like central Toronto seems like a non-starter.

Re: Silicon Valley's housing crisis, in one sentence

#174

Post by guyzero »

phlakaton wrote: post #172
phlakaton wrote: post #166

Earlier quoted context omitted.

Yes, but do the good people of Sunnyvale vote for infrastructure projects? Do they allocate enough funds for building that infrastructure, and/or do they have rational expectations for where those funds will come from? Even if you fear putting the cart before the horse, it simply begs the question of why you don't already have the horse. And the answer to that, I think, is back to what was stated above: fear of chang…

(BTW, I don't really mean to pick too much on Sunnyvale in particular here. The increased demand on housing and infrastructure can't be solved by Sunnyvale alone. It's a massive regional problem, if not a state problem, and the entire region is falling way short of meeting its needs.)

I don't take it personally and you are very correct. I'm just resigned that urban planning decisions made in 1960 are effectively irreversible.

Re: Silicon Valley's housing crisis, in one sentence

#175

Post by shostack »

johan_larson wrote: post #156
shostack wrote: post #155

Earlier quoted context omitted.

People don't like to hear this because it is just a very non-PC narrative, but it is the truth. In other real estate markets, this is a huge downward pressure on housing prices by the fact that if taxes get too high, it increases the inventory by the amount of people forced out. The Bay Area is almost entirely lacking in that pressure, which combined with other Prop 13-related issues and the area's popularity makes a…

> Really curious to see what happens in the long game as the families who inherit homes that were locked into old tax levels are forced to sell as they can't pass them on to a second generation without the tax rate resetting. That game has already been played. Transfers between generations do not cause reassessment. http://www.boe.ca.gov/proptaxes/faqs/propositions58.htm#1 Congratulations, California voters. You made…

Wow, that's crazy. I knew there was an exclusion of reassessment for initial transfer between parents and children (or grandparents and grandchildren in the event of deceased parents) but I didn't realize it just continued in perpetuity down the generational line. My original understanding was that the home could be transferred without triggering the reset in this manner once, and then subsequent times caused a reset.

Bad into worse just about sums it up. If it wasn't for Prop 58 and 193 you'd expect that eventually, decades from now once the majority were reset, that Prop 13 would have a chance of being struck down, but this just ensures that future generations have every incentive to keep homes in the family.

Thanks for sharing the link.

Re: Silicon Valley's housing crisis, in one sentence

#176

Post by guyzero »

palakchokshi wrote: post #160
guyzero wrote: post #129

Earlier quoted context omitted.

Well as an actual Sunnyvale resident the fears are slightly more rational: cars on roads, kids in schools and no increase in infrastructure to go along with the thousands of new residents. Some of the buildings have less than one parking spot per apartment which in theory is supposed to help encourage people to use transit, in practice people fear it will lead to more street parking in adjacent residential neighbourh…

I don't know why you're getting down voted either. will the down voters please address the following concerns? 1. Considering that some of the apartment dwellers will become homeowners and their place will be taken by new apartment dwellers, how will the overcrowded schools support the influx? 2. Considering people will take public transit to go to work, they still would use cars to move around locally in the area on…

For police, I honestly don't get the sense that they're really overburdened. Sunnyvale rates as one of the safest cities in the US.

For parking, Sunnyvale is indeed surprisingly bad. For a sleepy town with nothing to do you often can't get parking downtown.

Re: Silicon Valley's housing crisis, in one sentence

#177

Post by shostack »

gozur88 wrote: post #164
shostack wrote: post #151

Earlier quoted context omitted.

I think Mello-Roos is awful in some ways. New owners in the area shouldn't have massively disproportionate tax burdens because they moved there a few years later (in some cases that is a very large difference). Especially when you consider things like the fact that people are still using the resources just as equally. Areas change, and increasing taxes on all residents (even if it forces some out) is unfortunately pa…

>New owners in the area shouldn't have massively disproportionate tax burdens because they moved there a few years later (in some cases that is a very large difference). But they're paying for new infrastructure that didn't need to exist if they didn't move there. How is it fair to ask existing homeowners to pay more because new people moved in nearby? Mello-Roos is really no different than developer fees included in…

Let me paint a picture for you and you tell me if you think this is fair.

If you moved to the area in 2012, odds are you got a very good deal. If you moved in 2015, odds are you paid several hundred thousand dollars more for your home than your neighbor in a comparable home.

Do you think there is such a radical difference in infrastructure needs during that period to warrant shifting a disproportionate percentage of that burden to the person who bought only a couple years later? That is madness when talking about the kinds of dollars we are when things are percentage based.

Further, long-time owners in the area have been paying massively less than newer residents despite taking advantage of any new infrastructure funded by newer taxes thanks to Prop 13. Oftentimes to a comical degree.

Re: Silicon Valley's housing crisis, in one sentence

#178

Post by shostack »

rconti wrote: post #131
shostack wrote: post #103

Earlier quoted context omitted.

For more recent buyers I'll bet the market value piece is pretty high on the list. If you bought in the last couple of years while things have been increasing, you want to see that trend increase. If suddenly prices drop because there's a ton more dense housing (which also impacts the other desirability factors of the neighborhood), you could easily be underwater on your $1M+ mortgage. Given the amount of money at st…

I bought in the last couple of years while things have been increasing. You're right, I'd rather not be underwater, but I can stomach it or I wouldn't have bought. But you're making a huge logical jump to say that building housing could magically slaughter my house value and that I'd be underwater because of it. I'm worried about being underwater because of a recession or cyclical trends or tech jobs wholesale abando…

Mind if I ask if this is your "forever home" or close to it? I'll bet there's a hefty divide in whether or not people are worried about it going underwater based on their outlook for how long they intend to live there.

Re: Silicon Valley's housing crisis, in one sentence

#179

Post by palakchokshi »

mahyarm wrote: post #170
guyzero wrote: post #129

Earlier quoted context omitted.

Well as an actual Sunnyvale resident the fears are slightly more rational: cars on roads, kids in schools and no increase in infrastructure to go along with the thousands of new residents. Some of the buildings have less than one parking spot per apartment which in theory is supposed to help encourage people to use transit, in practice people fear it will lead to more street parking in adjacent residential neighbourh…

All of those new buildings and people will result in a far higher property tax revenue base since they are new units not starting from a 1980s prop 13 tax base. From that you can build new schools, hire more teachers and police and develop more transit.

But that revenue will have to be saved for a few years before there's enough to build new schools with, hire teachers with, etc. Moreover there might be other budgetary needs that might want that money unless the money is tied to improving schools, streets, etc.

Re: Silicon Valley's housing crisis, in one sentence

#180

Post by TheCoelacanth »

AceJohnny2 wrote: post #147

Remember when you played SimCity, and you had those demand bars for Industry, Commercial, and Residential Zoning? ... Of course in the real world, you can't arbitrarily bulldoze existing zones to replace them with high density residential :|

Of course, but you can at least rezone and allow people to bulldoze their own buildings and replace them with high density residential if they choose to. If housing prices are high enough, many of them will choose to do that.
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