The Unrepentant Individual

...just hanging around until Dec 21, 2012


May 31, 2005


The real reasons that I moved

When I first started talking about my move to Atlanta from California, Eric had posted about how educated, white-collar workers (such as myself) are starting to get fed up with the Golden State and looking elsewhere. He specifically pointed out how incredibly screwed up California politics are, and how taxes and regulation were driving individuals and businesses away from the state. That is part of why I’m leaving, but only a small part.

Many things played a part. My absolute hatred for everything related to the Los Angeles area was a big one, but when I lived in San Jose I loved it, so that’s not really anti-California. If I won the lottery, you’d probably find me somewhere along the Northern California coast. But the biggest reason was simple: it was too expensive for the life I wanted to live.

Hot California market daunts first-time buyers
Median home price passes $500,000; many young workers shut out

Pity the poor first-time home buyer in California. With the median price of a home in the Golden State crossing $500,000 for the first time, getting into that “starter” home requires perseverance, luck and a willingness to think small.

Maya Vestal, 25, who works for a biotech company, took the plunge this month with her boyfriend, plunking down $585,000 for a 1,200-square-foot home near San Jose in a neighborhood she describes as “not great.”

Frankly, the three-bedroom, one-bath house doesn’t sound all that great either. Built in 1940, it needs about $50,000 worth of work including new plumbing, new wiring and a new kitchen, she figures. “The only thing we’re keeping are the floors, which are beautiful, original hardwood.”

Together, Vestal and her boyfriend, a 25-year-old city worker, earn more than $100,000 a year, but the new $3,800 monthly mortgage payments will eat up nearly 70 percent of the couple’s take-home pay.

This is the main reason that I had to leave California. When I was working in Irvine, I was also living in an apartment in Irvine. That meant that my commute was only 10 minutes, but my rent was $1500/month for a 1-bedroom apartment. To stay near the area I worked, I wouldn’t be able to afford to buy a home, and barely could have qualified for a loan on a condo. To move far enough away that I could afford to live, I would have had over an hour’s commute each direction. In addition, my wife and I want her to be able to stay home with kids, when we have them, and to have any house or condo within a commutable distance of work would have taken two incomes.

As I’ve said before, I try to be as rational as possible. I looked at my options in California. I looked at what I truly valued in my life. And the choice was clear. The life that I want to have was a remote possibility in California. $600,000 for a 1200 sq ft home? Why bother? Why would I ever want to work so hard to buy something that meager? Would I want to leverage 70% of mine and my wife’s take home pay into a house that needs $50,000 worth of repairs? Would I want to try to move far enough away that I would be tormented every day with a horrible commute, just to be able to afford a ridiculous house instead of an insane one?

If I had bought a place a few years ago, the tremendous appreciation of the property would give me a different outlook. But I couldn’t rationalize trying to be a first-time buyer in that market. And I so desparately wanted to stop paying rent and start down the ownership process, so I had to make a tough choice. I look at the people who have stayed there and done it, and who are doing it. Partly, I ask myself the question of “how”? After all, I don’t know any lender who will underwrite a loan for 70% of somebody’s take home pay. But the question that inevitably takes precedence is “why”? Why would someone even do it? What about California could possibly make it worth it? I could never answer that question, so off I went. And I haven’t looked back.

Posted By: Brad Warbiany @ 12:59 pm || Permalink || Comments (7) || Trackback URL || Categories: Uncategorized

7 Comments

  1. Brad, Never look back, it won’t do any good. You made a good choice. It’s always wise to live within your means. I grew up in a 1,200 square foot house. There were 6 of us there with one bathroom. We lived there because dad and mom just couldn’t afford anything else. Mom stayed home and raised us while dad worked. I for one an glad that she was not a working mom. She was there when we got home from school and she made sure we did our homework and chores. We didn’t get into trouble much and we were happy. I learned alot living in that little house. It makes me grateful for all that I have now.
    I don’t blame you for wanting to move. I would never pay that kind of money for a 1,200 square foot house. It’s crazy. The house we live in now is about 2,200 square feet and we paid about $115,000. for it. It’s within our budget and I was able to stay at home and take care of our children. We live comfortabley and we don’t have to worry about every penny to live.
    Whatever choice you and your wife make together is a good choice. Be happy and enjoy your new sorroundings.

    Comment by Lucy Stern — May 31, 2005 @ 1:21 pm
  2. Brad, as someone a couple of years older than you who is invested in California I can answer some of the why.

    Our entire family is here in CA. If we move, our kids will be fortunate to see their grandparents, aunts and uncles more than once a year.

    It is costly to move.

    Our children go to good schools now. We aren’t sure that they would if we move.

    Fear of the unknown.

    It’s an absolutely beautiful place to live.

    We don’t necessarily like the cultures of other states (though, admittedly, this state is changing for the worse almost daily).

    The state has a serious problem though. Folks in my category (late 30’s & early 40’s, educated professionals, kids) are leaving AND young professionals like yourself are leaving. The net growth in the state is nearly all illegal immigrants or folks with lower income and education potential. They are trading their most productive group of residents for welfare residents. I don’t mean to categorize all of them as such, of course, but as a group that’s what we see. In ten years the state will be even more hopelessly unable to pay for the infrastructure and welfare society they have created.

    Comment by Eric — May 31, 2005 @ 2:25 pm
  3. Eric,
    That is one of the reasons that I made a distinction on people who own houses vs. first-time buyers. You have much deeper roots in California, and that means that the threshold, what you would be gaining compared to what you’d be losing, is a much different calculation for you. My wife has family in California, but we don’t have kids yet, and didn’t have a house/condo, so it’s easier to pick up and go.

    Comment by Brad Warbiany — May 31, 2005 @ 2:51 pm
  4. Congrats on getting out. I love the Atlanta area. If you work downtown, though, the homes are more costly, but you can do better than 1,200 sf and $585,000. If you work in tech areas, like south Gwinnett County, $500,000 will get you a mini-mansion of 4,500+ sf, 5BR, 4Ba, swim club, etc. You will do just fine in the 200-300 range as well.

    Comment by KJ — May 31, 2005 @ 2:54 pm
  5. KJ,
    I’m told that my wife and I are now “East Cobb Snobs” (we’re in Marietta, a little east of I-75). I cannot even begin to explain how absolutely excited my wife was to hear that. It made her day :-)

    Comment by Brad Warbiany — May 31, 2005 @ 3:11 pm
  6. Looks to me like you made a fine choice
    for the right reasons.

    Comment by jomama — May 31, 2005 @ 10:01 pm
  7. Congrats on your ascending social status! :-)

    Comment by KJ — June 1, 2005 @ 7:14 pm

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