ResalesCalifornians Check In, But They Don"t Check Out
Last year, Darrin Lipscomb and his family moved from Richmond, VA, one of the nation"s most affordable communities, to San Jose, CA, one of the nation"s least affordable cities.
Now director of engineering for a high-tech Silicon Valley company, which purchased his Richmond company, Lipscomb believes he made the right choice.
"From a strictly financial standpoint, the move didn"t make sense. I had to consider the enormous opportunity in the way of personal income and the ability to work with others to create technology used around the world," Lipscomb said.
"We plan on staying here to ride this technology wave for a while," he added.
He"s not alone.
Home buyers moving to California from out of state reached the highest level in a decade, according to the Third Quarter 1999 California Housing Finance Survey, released last week by the California Association of REALTORS®.
Cashing in on job, career and income opportunities virtually unattainable elsewhere, those who move to California join a growing number of existing residents, likewise perplexed by the state"s high cost of living, but not so much that they want to move away.
"Since the beginning of 1999, California"s housing market has exhibited a marked shift to a repeat buyer"s market," said CAR president Richard F. Gaylord.
Offering a snapshot of California"s burgeoning housing market, CAR"s quarterly survey also revealed 63.5 percent of the state"s home buyers were repeat buyers, just shy of the record 67.6 percent in 1987.
"In spite of the high cost of living in San Diego, we just decided last October to start some serious saving and to buy our first house this year," says Kimberly Williams-Kee whose family moved to California when she was a toddler.
Now married with two kids and deep roots, she"s staying.
"We wouldn"t give up the lifestyle, family, weather, etc. for anything," she says.
The CAR survey of 5,000 California REALTORS, with more than 500 responses about transactions occurring in July, August and September last year, paints a vivid picture of the state"s expensive, but still growing housing market and the factors that contribute to its desirability.
Among CAR"s third quarter findings:
Homes are expensive. The median sales price was $239,700, virtually unchanged since the first quarter 1999 but up 6.5 percent from the second quarter last year.
Homes are a good investment. Home equity (median net cash to sellers) was a solid $73,000 in the third quarter 1999, below the $75,000 equity level recorded in the first quarter 1999 but still the third highest during the 1990s.
Home sales are hot. Nearly one-third of homes for sale, 32.7 percent, received multiple offers.
Homes sell for more. Nearly 40 percent of home sales were at or above the asking price. Slightly more than 13 percent of home sales were above the asking price.
Homes sell fast. Homes were on the market for a median of four weeks.
The stock market factor. The stock market played a role in the decisions of 10.1 percent of those buying or selling, up from 6.6 percent in the second quarter. In the San Francisco Bay Area, which includes Silicon Valley to the south, the stock market played a greater role -- 17.5 percent of the buy- or sell-decisions where triggered by the stock market. In Southern California the stock market affected only 7.0 percent of those decisions.
Home owners stay put. During the third quarter 1999, 44.4 percent of home sellers stayed within the same county, the highest on record.
Fewer are leaving. Only 16.4 percent of California home buyers relocated, compared to 30.9 percent in 1995.
More buyers relocate to California. Out-of-state or out-of-the-country buyers comprised 11.1 percent of all buyers, the highest on record since 1989.
"My husband and I have lived in California for 18 years now. The weather is great, people are friendly. There"s no end to what you can do here, opera, plays, ballet, fashion. Anywhere we want to be, the beach, skiing, gambling, hiking, camping, you name it, we"re just a few short hours away," said Christine Mohammed, a loan agent with Elliot Ames in Los Gatos, CA.
"The brain power is here. As much as companies have moved to other states, they can"t duplicate or replace the brain power that"s found in Silicon Valley," she added.
Also See:
All That Glitters Is Not Silicon
Silicon Turns To Gold For California Home Buyers
Go West? Demands for High-tech Jobs Sparks Housing Sticker Shock