May 31, 2005
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 â€œstarterâ€ 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 â€œnot great.â€
Frankly, the three-bedroom, one-bath house doesnâ€™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. â€œThe only thing weâ€™re keeping are the floors, which are beautiful, original hardwood.â€
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 coupleâ€™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.
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