How can anyone afford a decent house in Los Angeles/SoCal?

Question

For crying out loud! A run-down crap trailer costs triple the price of my 3-bedroom newish brick home in the Houston area.

We have outgrown this house and are seeking relocation with our eye on the West Coast but LAWDY! Anything with 4 bedrooms is automatically a million dollars. How do you Californians do it?

I am a graphic designer/digital artist and my husband is a construction project manager. I have been perusing job ads and it seems the pay is even LOWER in LA than Houston. It just doesn't add up. I know there are plenty of "normal" people pulling this off, so I want to know their secret!

Answer 1

Some of us, such as myself, bought our homes many years ago before the real estate prices became ridiculous. If I had to do it today, I couldn't possibly afford to buy the house I presently live in, it's appraised at 9 times what I originally paid for it.

Answer 2

As others have indicated, it's mainly first time buyers that are being priced out of coastal CA. Most people here owned there homes before 2001 and many could not afford there current homes if they were buying for the first time. If you're a first time buyer you need to make a lot of $$ to buy a home. But many first time homebuyers that choose not to leave the state are buying homes in cheaper, inland locations like San Bernardino and Riverside counties. Homes are cheaper inland but the commutes tend to be longer b/c most of the jobs are in LA and Orange Counties. If you are willing to endure an hour long+ commute then you can find homes in Riverside and SB Counties or the high desert for under $400K.

Or you can choose to live in a condo or townhome, which many people are doing. I read an article yesterday in the San Diego Union-Tribune discussing how development in San Diego and much of coastal Southern CA will be mainly dense, multi-family, attached housing from here on out. We just don't have the land to build single family homes anymore. Those other parts of SoCal like the Inland Empire (Riverside and SB Counties) and the high desert are building tons of homes but it's turning into uncontrolled, ugly sprawl-like development. It's probably similar to Houston's sprawl but a lot denser. Development in LA, Orange County, Riverside, and SB seems to stretch forever.

Unless you can muster up a large down payment you'll either have to downsize to a smaller home like a townhouse or condo or move out to the edge of the metro area and endure a long commute to be able to afford a home.

If you aren't set on LA you might want to check out San Diego, it's cheaper and it's much less congested and polluted. Homes prices here are falling so it's a good time to buy and will only get better b/c it will take awhile for incomes to catch up with home prices. The Bay Area is even more expensive than LA but jobs pay pretty good there.

Answer 3

Peedlepup's right. The answer to your question is "Buy your house at least 5 years ago". (Sort of like the line from "Robots"- "Come back 2 years ago and the job's yours").

We're pretty normal folks, a teacher and computer tech, and don't make astronomical salaries. We bought in 2001, and could not afford our house now, which is more than double what it used to be. The trick is to get our oldest daughter to buy when this dip in prices hits bottom, before prices start going up again.

In your situation, you might have to go a little further east, like San Bernardino and Riverside Counties, to get something affordable. I've found that the Temecula area is up and coming, there is certainly a lot of construction going on out there.

Good luck!

Answer 4

Here's your answer. Lease to buy a home. All the "rent" money during the contract will go towards the down payment at the end and you could get away with purchasing a brand new 3500 sq ft home for around 2500-3000 a month in some areas.

Answer 5

Try looking into living in Northern Cali. The rent is alot cheaper upstate then it is in Southern California. It still is probably a bit high compared to Houston but North Cali is still afforable. The food prices are fair, the job market is quite open and the homes are still affordable.

Answer 6

Kirs, another way people do it is with horrible loans (0% int. variable) that suck them dry- most everyone is "house poor". I knew so many people with hundreds of thousands of dollars of debt. Also, don't forget the property tax on a million dollar home- it's outrageous, too. And, those taxes don't even help with what is one of the worse public school districts in the nation. My advice is stay in Houston and move to a big, new house. L.A. just isn't worth the money.

Answer 7

why do you think there is so much traffic? the more affordable housing is in the sub-, sub-, suburbs. commutes of 3 hours or more are not unheard of.

all the people i know who own houses have two incomes and had to have help from their parents.

i've never seen any stats, but i think there are more renters than owners in the city.

you might want to wait for the next earthquake. housing prices usually drop after that.

Answer 8

They pay here is lower than other parts of the country. And housing prices are higher than part of Hawaii. To manage it both my husband and I work full time and some weeks we must work 50 to 60 hours a week to manage. both of us are professionals and hold masters degrees.

Answer 9

Well, the millions of people who live in those decent houses all seem to manage it.... Its no different in the New York suburbs.

Answer 10

its not easy! You either have to own your own company or both parents have to work 40 + hours a week.