SILVAR. How Tax Reform will Affect BA Real Estate


Well, I see advocates for 401K buying homes. What’ happened? Don’t trust your favorite investment? Better yet, teach your kids to do the same. Sell your homes, and open as many 401Ks as you want. Right? :laughing:

On the serious side, this is what happens with the tax reform, trickle crap never worked.


no airfare needed… hyperloop only. Too many Amazon delivery drones in the air

SFO will be converted into a massive Facebook server farm for pictures of kittens


As long as you can afford to hold onto the house long enough, you’ll be fine. The biggest risk is a forced sale during the crisis. A temporary price decline is not a big deal unless you sell at a loss.

So the risk is upon yourself. Housing market will do its own thing, it does not care what everyone’s personal scenario is


FYI, I bid an offer today , but lost it as the highest overbid is 300k+ ! San Jose 9513X, Keeping the home confidential. This is not hype or invite, just sharing the details for forum members.


Is it worth buying this market then? Are you seeing any areas that are not as bad in overbidding? Is the tax reform anticipation thats driving this frenzy?


Who on here advocated that? It’s not even possible to do with a 401k. You can’t sell a home and put the money into a 401k. The fact you think that shows little you know.

Most people are split between stocks and real estate. It’s called diversification. It seems most people are waiting to buy more real estate until price/rent ratio becomes more favorable. It’s called buying when the pricing conditions are good.

I guess when you can’t go earn money, then it sounds good to have the government go take money from others and give it to you. Most of us prefer to earn our own money.


That is the right question!

I could have bid more than 350+,eligible financially, but I am unable to accept that kind of price! By heart, I do not see value in it. It may be other case that I am comfortable with current one instead of paying premium.

While others, who has got easy money through company iPos or stock options and do not have home, it may be worth paying that premium as they do not have any other way except keep renting!

Are you seeing any areas that are not as bad in overbidding?

Outer areas such as mountain house… etc, you can get, but not in Bay Area.

Is the tax reform anticipation thats driving this frenzy? FOMO is driving crazy, but not tax reform !


Aren’t these too far from the big tech campuses, except from the proposed new Google offices?

I know someone who sold from 95135 & moved to south fremont(Mission) due to bad commute.


This is also my experience in the last 6 months and I have arrived at a conclusion that

  1. Good deals are not financible because of the condition of the home.
  2. Increase in cash buyers. Taking advantage of the appreciation, take out Equity lines ( eg HELOC of 1M on a 2M property). They are using this to get a deal, and then finance or a quick flip
  3. Lot of wholesalers, trying to put in a offer disguising as a legit buyer and buying time, fooling the seller. If they dont find a buyer, they dont show up with Earnest money. So your profit/rate of return is eaten away by the wholesaler.

So buy in this order if you need to buy RE

  1. For flips, Expect ARV to jump 100k more than your aggressive estimate. very profitable.
  2. Primary home, if you are renting. Fremont (for schools) is a great bargain instead of buying at 2k/sft in Fortress.
  3. Buy and hold, doesn’t make sense at all at this Price point.


No underground tubes for me. Flying private is the only way to go baby…


Just for information, I bought a 3/2 SFH at the peak in 2007… house price tumbled about 15-20% after that… bottomed in 2009-2011 (kind of sideways during the 2 years). A couple of months later, a slightly bigger house just one house away transacted at $150k lower than my purchase price :rage: Now it is worth twice what I had paid :rofl: RBA/ Fortress is the right place to be, elsewhere such as Concord is still below the peak.


IMO, Perfected here !


Schools seem to be terrible.

In light of your economic predictions what will the price in 2020?


Schools does not matter when commute and nearness to office is there.
There are many unmarried (less than 25 age) millionaires out there to buy homes near by office and shopping centers.

Hard to predict the future price, esp short term for individual homes. If there is some economic crash, assume 20% down from the peak time, but if economy booming you can expect 7% an year. These are just balpark guess, but actual may vary.

But current buyer is good to get 1.3M+ price.
He may build a nice 3500 sqft home for 600k at some point later.
All he needs to do is hold for 5 more years.
He will not lose any money.


You can also consider where I live: 95120. It has great schools, and the price is much cheaper than the fortress. It will work out well if you work in San Jose.


Almaden valley: Looks like Avg price is >1.5M. Price per sft is definitely attractive. Not familiar with the area.


Isn’t Almaden a bit too far from work? It’s definitely nice down there.

Anecdote: someone I know just bought a smallish house in Little Saigon for 800K. The area is up-and-coming at best, and schools are awful. It’s within walking distance to Walmart, so you know how it is. I was very surprised a location like that could fetch that price, because not too long ago that was the going price for Evergreen. EG is not high end, but schools are decent and neighborhood is quiet and peaceful.

Anyone bidding in Santa Clara and God forbid Sunnyvale will tell you how crazy those two markets are.

It’s no longer just the usual FANG suspects. AI has lifted a ton of hardware companies, some so obscure most people haven’t even heard of. Who have heard of Lam Research before 2017? Well, its stock has shot up 83% this year. And then there is Nvidia of course.

Even the mainland Chinese think our market is too expensive for them. They have moved to Seattle and East Coast. It’s local money bidding the price up. Inventory is so thin it only take 100 or so people to jack up a small market like SC. If a home had 30 offers, what do you think the 29 people who lost will do? They will all bid on the next house of course.

Price appreciations: they are real, and they are spectacular!


Source? Your friends?


Didn’t I post some articles to that effect?


That’s exactly why tax reform won’t kill BA RE. So you knock out the 6-8 weakest bidders. Who cares? There’s 22-24 more bidders and supply isn’t being built fast enough. Jobs have beat new homes 8:1 since 2009. Appreciation might slow a bit, but prices will still increase. Slowing down the pace a bit is probably healthy.

We probably have 2 years of this cycle left. That means by the time a recession hits jobs growth will out number new homes by a huge margin. The margin of safety on the supply and demand curve will be huge.