Jon Mays

Let’s say you tip $2.25 for a basic avocado toast from a place called Avocado Toast in San Mateo. Generous, for sure, but not unusual. That’s on top of the $5.25 price and tax. That brings it to about $8.

Let’s say you do that for 212,500 days in a row. That would be 582 years. That’s how long it would take for you to pay cash for a median-priced $1.6 million home in San Mateo County if you were to not buy the avocado toast and, instead, put it toward the purchase of the home. Coming up with the 20% down payment of $320,000 would bring it to 40,000 days, or 110 years.

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(1) comment

Terence Y

Mr. Mays – great summary of competing opinions regarding housing. My two cents… For those fortunate to have homes, being demonized probably isn’t too upsetting, since they’re already entrenched and they’re reaping the rewards of rising home prices. As for the recent passage of legislation to allow duplexes or four-plexes or additions to single-family homes, I’m unsure many homeowner’s will take “advantage” of those options, especially since it means reassessing their property taxes to a new, and considerably higher baseline? Along with the increase in fees and taxes based on percentages of the base value. This new baseline will then last forever and a day, and for what, their existing home value is already increasing.

For those unfortunate to be unable to purchase homes, instead of demonizing existing homeowners, they should probably demonize local and state governments’ approach to housing and development. One can easily search the net for literature related to reasons for the high cost of housing in CA. If you take a gander at the Terner Center for Housing Innovation, UC Berkeley site, you’ll see a number of research papers. Of note, and written several years ago, are papers on the cost of housing development in seven CA cities and residential impact fees in CA, among many other housing articles. It's safe to assume fees have gone up since then. In the Bay Area, how much does it cost builders to install mandatory all electric appliances, mandatory electric chargers for the majority of folks who don’t own electric cars, low-water or no-water toilets, etc.? Builders aren’t going to throw in those “features” for free and will pass on the cost to homebuyers. Let’s not forget the constant drumbeat to increase minimum wages, accelerating raw materials costs, and inflation. More costs to be passed on to the homeowner.

What’s the solution? Reverse development costs and reduce or eliminate impact fees. Reduce or eliminate nanny regulations and guidelines. If additional mandatory this and mandatory that fees continue to increase, so will home prices. Potential homebuyers, or those without means, will just have to grin and bear it. Or enjoy avocado toast, instead.

Another solution? If people are fans of stack and pack housing, build multi-story dorm buildings and begin selling rooms with communal kitchen and bathroom rights. Remodeling high rises, such as the Oracle buildings, into apartments/dorm rooms. Just think of being able to say you live in one of the Oracle towers, and you don’t have to worry about tipping over, a la SF’s Millennium Tower. These buildings would have the benefit of not destroying single family home neighborhoods as well as creating housing for much more people. Win-win!

For those existing homeowners, pay no attention to the name-callers, and instead, enjoy your homes. If you plan on remodeling your homes, I’m quite sure remodeling existing homes will trigger a property tax reassessment. However, I’m positive your assessed value will not decrease.

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