- Jan 6, 2005
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I moved to SoCal about two years ago, fresh out of grad school with a solid job offer from a respectable company, achieving the American dream of social mobility coming from a fairly humble middle class household.
And yet I can't afford a home in Southern California, unless of course I am willing to accept a 2 hour commute each direction by living out in Riverside or San Bernardino.
Unfortunately, the timing of my move was terrible, as the SoCal housing market was already in the middle of spiraling out of control when I hit the ground.
Now I understand that SoCal attracts the rich and wealthy from the world over...everyone from the entertainment industry elite to Saudi oil princes and dot.com overnight millionaires. Similarly, I can see how say areas like Laguna Beach or Newport Beach or Malibu are considered hot markets, as they are coastal. I know and accept that certain areas of SoCal are simply beyond my reach, unless I hit the lottery.
What I don't understand is how rural suburban areas...Mission Viejo, Irvine, Anaheim Hills, Corona, Yorba Linda...are so overpriced, when there is really no justification for it.
All around me, I see these preplanned communities going up...and the price tag is always over $1M...homes that you can purchase in other regions of the country for 300k. Even a 1940s to 1960s era construction home that requires a lot of work goes for around 700k.
So how is that people are able to afford these homes? Again, I can see how the coastal regions would attract those making the money to afford such homes. But given my encounters with the families that live 10 miles inland, I don't see how they can possibly afford these homes. These families are probably bringing in salaries comparable to mine...somehow the math isn't working out for me...especially considering that in addition to having the $1M home, they also have a Mercedes and a Lexus in the driveway...I am still driving the Honda I purchased out of college.
I am well aware of these interest only or variable interest loans, which perhaps explain some of it...I refuse to go that route to purchase a home...but that seems like a fairly risky foundation for any housing market, and I can't envision such a market dynamic remaining sustainable.
Similarly, all of the housing reports and analyses I read indicate that the SoCal housing market is overprices by as much as 50%. I can't even imagine how blue collar families manage to get by out here...truly blows my mind.
So someone please enlighten me as to how people are able to afford homes in such an inflated market?
And for the record, I have been debt free since leaving the nest...no college loans...no car payments...invest in my company 401k, live on a fairly rigid budget, and do all the things I am supposed to be doing financially.
And yet I can't afford a home in Southern California, unless of course I am willing to accept a 2 hour commute each direction by living out in Riverside or San Bernardino.
Unfortunately, the timing of my move was terrible, as the SoCal housing market was already in the middle of spiraling out of control when I hit the ground.
Now I understand that SoCal attracts the rich and wealthy from the world over...everyone from the entertainment industry elite to Saudi oil princes and dot.com overnight millionaires. Similarly, I can see how say areas like Laguna Beach or Newport Beach or Malibu are considered hot markets, as they are coastal. I know and accept that certain areas of SoCal are simply beyond my reach, unless I hit the lottery.
What I don't understand is how rural suburban areas...Mission Viejo, Irvine, Anaheim Hills, Corona, Yorba Linda...are so overpriced, when there is really no justification for it.
All around me, I see these preplanned communities going up...and the price tag is always over $1M...homes that you can purchase in other regions of the country for 300k. Even a 1940s to 1960s era construction home that requires a lot of work goes for around 700k.
So how is that people are able to afford these homes? Again, I can see how the coastal regions would attract those making the money to afford such homes. But given my encounters with the families that live 10 miles inland, I don't see how they can possibly afford these homes. These families are probably bringing in salaries comparable to mine...somehow the math isn't working out for me...especially considering that in addition to having the $1M home, they also have a Mercedes and a Lexus in the driveway...I am still driving the Honda I purchased out of college.
I am well aware of these interest only or variable interest loans, which perhaps explain some of it...I refuse to go that route to purchase a home...but that seems like a fairly risky foundation for any housing market, and I can't envision such a market dynamic remaining sustainable.
Similarly, all of the housing reports and analyses I read indicate that the SoCal housing market is overprices by as much as 50%. I can't even imagine how blue collar families manage to get by out here...truly blows my mind.
So someone please enlighten me as to how people are able to afford homes in such an inflated market?
And for the record, I have been debt free since leaving the nest...no college loans...no car payments...invest in my company 401k, live on a fairly rigid budget, and do all the things I am supposed to be doing financially.
Are they manufacturing new land in the Southern California coast? It is what people will pay for it. If you think that's too much for you get, then move somewhere else. 
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