[onlyrealcuzzo]

What market?

Anecdotally, I follow many smaller markets in the Midwest and the South (plus Chicago). I wouldn't call it a buyer's market anywhere. But I'm not seeing anything like this.

I also have a few friends shopping on the East coast - and they're in a similar situation. It's not a buyer's market. But also not crazy.

My understanding was that The Bay, SoCal, and Seattle had massively slowed down. So I'm just wondering where this could be - or if things have recently turned around a lot.

Maybe my info is just bad...

[jedberg]

The house around the corner from me in Cupertino just sold. It's 1700sq ft on a small lot, and they were asking $3M for it. It sold for $3.2M four days after the open house. It sold so quickly they cancelled the second open house. Apparently they got 20+ offers.

So at least here in Cupertino, things are still nuts.

[subsubzero]

Cupertino is a unique case as you have extremely rich Chinese investors as well as apple HQ in that city. Also it is known to have the best schools in the bay area besides Palo Alto. But yeah totally crazy nonetheless.

[jedberg]

Interestingly only 10% of Apple employees live in Cupertino. And we actually don't have many foreign investors, Chinese or otherwise, as most houses are owner-occupied. But you're right about the schools!

[cryptonector]

$3.2M for a measly 1700sq ft?! Nuts. You can have a bigger, probably better house near the new Apple campus in Austin -walking distance, through a beautiful park no less!- for $600k or $700k.

[jedberg]

You pay $700k for the house and $2.5M for the weather, stable power grid, and lower taxes (yes, people in Cupertino pay lower overall taxes than people in Austin).

[tfehring]

> people in Cupertino pay lower overall taxes than people in Austin

Only because most people who can afford to buy in Cupertino aren't paying for it with earned income, right? Google tells me a $2.5M mortgage has minimum payments of $230k a year, anyone who makes enough to afford that is probably paying at least $50k/year in CA state income tax, on top of ~$25k in property taxes. Austin has high property taxes but I don't see them coming anywhere close to that, and the sales tax is lower.

[jedberg]

Property taxes are a lot lower in California because of Prop 13. For a new buyer, they are about the same. But after just a few years, the Texas property tax will be much higher because California property tax pretty much doesn't go up after you buy. Also energy taxes soak Texans because they use a lot more energy than in California due to the hotter summers and colder winters.

[foogazi]

> For a new buyer, they are about the same. But after just a few years, the Texas property tax will be much higher

But do you have 1,700sqft shacks going for $3.2M in Texas ?

[cryptonector]

One might pay less in taxes in Cupertino, but if the mortgage service is 3.5x what it would be in Austin, then one is still paying a tremendous amount in what amounts to a tax of sorts. Sure, if you have a mortgage you'll be building equity, but also paying more interest than you'll ever build in equity, and you'll depend on ever-increasing property values to begin to make this a worthwhile trade-off.

[chasebank]

How do they pay lower overall taxes?

[jedberg]

Here is an article on it:

https://www.yahoo.com/video/everything-bigger-texas-includin...

But basically the higher property taxes and additional taxes and fees that Texan's pay on consumption, like energy taxes, end up more than making up for the lack of income tax, unless you're a top 1% earner (which is somewhere around $700k/yr). Energy tax is a big one because Texan's use a lot more energy since they have hotter summers and colder winters.

[SilasX]

The question was about a Cupertino homeowner vs what that corresponding homeowner would see in Austin. You're linking an article about the median Californian vs median Texan, which -- even accepting its assumptions -- is only superficially relevant, and very unrepresentative for the comparison under discussion.

Even at the lower rate, the property taxes on the Cupertino house alone dwarf any tax difference they would pay for a comparable lifestyle in Austin [1].

To be blunt, but it looks like you deliberately chose a misleading comparison to push the narrative you already settled on. That's below the standard I've come to expect of your comments.

[1] Here's a $3.2m Cupertino home, which shows $40k/year in property taxes. A comparable home in Austin for the $700k the parent mentioned would have ~$14k/year in property taxes. https://www.realtor.com/realestateandhomes-detail/21467-Krzi...

So, paying the $2.5 million ... to pay $26k/year more just in property taxes.

[chasebank]

"About the only Texans who fare better than Californians are the wealthy. The top 1% of earners in Texas — those making $617,900 or more annually — only pay 3.1% of their income in state and local taxes. That compares to a rate of 12.4% for top earners in California, who make $714,400 or more per year."

So if you're a top 1% or more, you save at least 4X in taxes. I'm sure you come out on top in TX financially for the vast majority of people reading this site, $100k+ earners. Everyone I know that moved to Austin from CA did so to avoid paying taxes on cashing out stock options.

[cryptonector]

If you don't consider higher cost of shelter a sort of tax...

The cost of shelter for an Apple employee in Cupertino is what, 3.5x the cost of shelter for an Apple employee in Austin? Nuts.

[spacemadness]

I think these people making these choices are in another universe from most of us working folk, so understanding this behavior from one data point isn’t going to make sense. This could even be a second convenience home. It can be hard to wrap your head around that much wealth if you’re in more down to earth class.

[jedberg]

I haven't met the new owners yet, but most of my other newer neighbors are not what you'd consider wealthy. It's mostly families with two working adults where one works or worked at FAANG and sometimes both. Most people's story start with "my FAANG stock made my down payment, and the salary pays the mortgage".

The older neighbors are generally people who have owned for 30+ years and bought when things were still reasonable. The houses in our neighborhood are all about 60 years old, and we even still have some original owners!

But the point is for the most part people here are not so wealthy they can stop working, they just have high paying local jobs to pay for their really expensive house and don't have a lot left over after housing expenses.

[spacemadness]

Spending 3.2 million on a home is in another league of wealth from the vast majority of people.

[strikelaserclaw]

they probably could stop working, they just wouldn't be able to afford a house in Curpertino.

[iancmceachern]

Yeah but the weather....

[cryptonector]

I love the weather in Austin. Not very cold in the winter, and I love the dry heat of the summer.

[purpleblue]

San Francisco condos are down a lot, many going for less than $1000/sqft now. But that's also the political climate and the increase in crime that is contributing to all that. I might come in when condo prices fall to about $600/sqft.

[itake]

I heard a similar story about Bellevue and Sammamish, WA. North Seattle-area (Edmonds, Lynnwood, Mill Creek, etc) have seen a price decline.

[vbtemp]

Many of the Northern VA counties and certain others in the DC metro area.

[tssva]

Things cooled somewhat in the fall but have definitely rebounded. On Friday the 10th I placed my townhouse in Loudoun on the market. Choose from 17 offers on Sunday evening. Accepted an all-cash offer with a quick closing for well above asking. Moving on Saturday.

[jjk166]

I've been looking around the suburbs of Philadelphia, it's been a frenzy since summer of 2020. I guess it's slightly better in the sense that houses stay on the market for a few days instead of a few hours, but it's still absurd. My uncle, who is also in the area, put his home up for sale about a month ago and got a multimillion dollar offer same day without anyone even looking at the place. Even though prices have tripled and mortgage rates have doubled, a mortgage is still cheaper than rent.

[sharkmerry]

entirely anecdota but a house me in the peninsula bay area, got bought for 1million (3/2) 8 months ago. got reno'ed- listed for 1.698 a month ago- went for 1.755