Why do people Buy Property in California

Los Angeles County, California
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Why do people Buy Property in California

James Wise
Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes

Do people still buy property in California for any reason other than the weather? Seems like everything else about California sucks. High taxes. Soft on crime. People just stealing whatever and whenever they want. Homeless people living in tent cities pooping on the streets etc.....

Why do people still go to California?

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Russell BrazilBusiness Member
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Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
1y

Where do you think people are growing richer with real estate.....Los Angeles or Cleveland? Owning just a few typical properties in California turns you into a multimillionaire very quickly. Owning a few typical properties in Cleveland gets you an extra $500 a month.

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  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    1y

    I've pondered this....I believe it would be either for family reasons, maybe job related...?

    And then we have to realize that there are people who actually approve of all those things you mention....I know, how could anyone embrace those policies? But yet they do, millions of them.

    And a lot of people just like what they know, and if they were born there and everything they know is there, they just won't think of leaving.....

    6Reply
  • James Wise
    OP
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    1y
    Quote from @Bruce Woodruff:

    I've pondered this....I believe it would be either for family reasons, maybe job related...?

    And then we have to realize that there are people who actually approve of all those things you mention....I know, how could anyone embrace those policies? But yet they do, millions of them.

    And a lot of people just like what they know, and if they were born there and everything they know is there, they just won't think of leaving.....

     To my understanding there is a big push back on all the soft on crime mumbo jumbo. Looks like Orange County is out there trying to make stealing a crime again lol. I guess letting people steal whatever they wanted whenever they wanted didn't work out too well. Who woulda thunk?

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  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    1y

    And there may be hope. In the recent election, over 50 counties flipped RED. Add to that the fact that many Hispanics are turning to the R party for relief from the insanity.

    We shall see.....

    1Reply
  • James Wise
    OP
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    1y
    Quote from @Bruce Woodruff:

    And there may be hope. In the recent election, over 50 counties flipped RED. Add to that the fact that many Hispanics are turning to the R party for relief from the insanity.

    We shall see.....


     Another interesting factor to California is global warming. I'm in Ohio and the winters here are nowhere near as crappy as they used to be 20 years ago. This continues and the appeal of Cali keeps going down in my opinion.

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  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    1y
    Quote from @James Wise:
    Quote from @Bruce Woodruff:

    I've pondered this....I believe it would be either for family reasons, maybe job related...?

    And then we have to realize that there are people who actually approve of all those things you mention....I know, how could anyone embrace those policies? But yet they do, millions of them.

    And a lot of people just like what they know, and if they were born there and everything they know is there, they just won't think of leaving.....

     To my understanding there is a big push back on all the soft on crime mumbo jumbo. Looks like Orange County is out there trying to make stealing a crime again lol. I guess letting people steal whatever they wanted whenever they wanted didn't work out too well. Who woulda thunk?


    oregon and washington have the same laws and same problems  Oregon even went so far as to make ALL Drugs legal that led to all sorts of overdoes deaths in Portland and zombies walking the streets.. that got turned over this year.. the steal 900 or less is just a ticket is next to get repealed..

    Keep in mind CA  is like put Ohio Kentucky TN and Alabama all together as one state.. So weather is as diverse as it is from Cleveland to Mobile..  Along with State and federal forests that are larger than most new England states with no housing in them.

    Also much of rural CA.. price points are not what folks think of CA there are areas of CA that are just flat gorgeous with housing readily available for 200k to 400k.

    For those that have lived in CA long time and owned RE prop 13 has kept their property tax's a fraction of what they would pay in ANY other state.. But yes income tax is top 5 in country and there is sale tax.  And use tax on boats and airplanes etc.  

    One just drives around San Jose/Cupertino/Mtn View/ Sunnyvale and look at all the tech companies and you know its not going anywhere.. I grew up in the family home 1/2 mile from the new apple headquarters and the main roads at the time Stevens Creek BLVD was still gravel in places.. And hwy 280 was not yet built.

    U can pick were you want to live in CA its not all  Watts  Comptom Oakland etc etc.. Not even close..  This is why people live there granted a lot of folks have left for Austin because of Tesla Gov Newscum ran Musk out LOL..  

    End of the day I will be back to my happy place in the Sierra Valley north of Truckee to my cabin in the woods and fishing and golfing in yes that perfect CA weather.
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  • Marcus Auerbach
    Investor · Milwaukee - Mequon, WI · Member since 2010 · 5k+ posts · 7k+ votes
    1y

    Net migration is negative for a reason. A lot of Californians moved to AZ and TX, but as significant as the numbers are it's only a drop out of a very large bucket. I don't think anyone goes to CA to invest, but a lot of residents invest local to keep the home-field advantage which is a valid point.. Even though landlord-tenant laws are horrible for landlords, which translates into more risk and a higher cost of doing business, resulting in higher rents, which is where we come full circle..

    Glad to see a little common sense come back with the new prop36 smash&grab laws

    1Reply
  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    1y

    Where do you think people are growing richer with real estate.....Los Angeles or Cleveland? Owning just a few typical properties in California turns you into a multimillionaire very quickly. Owning a few typical properties in Cleveland gets you an extra $500 a month.

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    29Reply
  • James Wise
    OP
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    1y
    Quote from @Russell Brazil:

    Where do you think people are growing richer with real estate.....Los Angeles or Cleveland? Owning just a few typical properties in California turns you into a multimillionaire very quickly. Owning a few typical properties in Cleveland gets you an extra $500 a month.

     You'd already need to be a millionaire to be able to buy a few properties in Los Angeles. Besides, who said anything about buying property in Cleveland?

    5Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    1y
    Quote from @Jay Hinrichs:

    Most people also don't realize that most of Eastern CA is just about as redneck/cowboy as places in AZ or TX (much like eastern Oregon). And here's an interesting map that compares voting 2020 vs 2024.


    2Reply
  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    1y
    Quote from @Bruce Woodruff:
    Quote from @Jay Hinrichs:

    Most people also don't realize that most of Eastern CA is just about as redneck/cowboy as places in AZ or TX (much like eastern Oregon). And here's an interesting map that compares voting 2020 vs 2024.



    YUP. same with Eastern/central Oregon and Washington.. Oregon pop is about 3.5 million 2 mil live in the Willamette valley which is very very blue.. Just the way it is.. NV has seen a ton of CA especially socal folks move to Vegas  and thats where I will end up shortly as well.. summer home in N> CA  residence in tax friendly and winter weather friendly Vegas. And of course a bunch of grandkids there LOL.
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  • Jay HinrichsBusiness Member
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    1y
    Quote from @Russell Brazil:

    Where do you think people are growing richer with real estate.....Los Angeles or Cleveland? Owning just a few typical properties in California turns you into a multimillionaire very quickly. Owning a few typical properties in Cleveland gets you an extra $500 a month.


    The value of homes in the mid west rust belt and CA in the 70s was basically the same.  My parents bought their home in Cupertino or 30k in 70.  Today it worth at least 3 million.. Nothing but regular maintenance.. 30k home in the mid west rust belt in the day depending on what happened in those cities demographically wise could be still 30k or maybe 300k.. thats where the  wealth has been created in CA.. Just sayin..
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  • Phillip AustinPro Member
    Property Manager · Denver, CO · Member since 2023 · 236 posts · 204 votes
    1y

    @Jay Hinrichs @Russell Brazil Got it. So REI in California only makes sense if you've been there since the 70s or 80s OR if you're financially well off and can afford a few million dollar properties.

    2Reply
  • Scott Mac
    Austin, TX · Member since 2019 · 5k+ posts · 5k+ votes
    1y

    California used to be smoking hot.

    Like Jay said houses that used to be $30,000 now go for millions.

    1Reply
  • James Wise
    OP
    Real Estate Broker · Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH · Member since 2013 · 30k+ posts · 20k+ votes
    1y
    Quote from @Phillip Austin:

    @Jay Hinrichs @Russell Brazil Got it. So REI in California only makes sense if you've been there since the 70s or 80s OR if you're financially well off and can afford a few million dollar properties.

     The historic housing cost appreciation in California has been amazing. No argument there. However, if we look at living in California these days. It seems like the quality of life is going down. As for the weather, with all of this global warming, other locations with less desirable weather are starting to be a bit warmer, I can definitely see a huge difference in Ohio winters. We've also got a ton of remote work going on in this post Covid world. So the question is, do people still want to live in California as much as they used to? And if they don't, will the appreciation continue like it used to?

    2Reply
  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    1y
    Quote from @Phillip Austin:

    @Jay Hinrichs @Russell Brazil Got it. So REI in California only makes sense if you've been there since the 70s or 80s OR if you're financially well off and can afford a few million dollar properties.


     If that's what you took away from what Jay and I stated here that's a real shame.

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  • Steve K.
    Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
    1y

    I really enjoyed my time living in California (Joshua Tree and Yosemite). The rock climbing is the best in the world, lots of great rivers, skiing, mountain biking, surfing etc. The redwood forests are uniquely special and amazing, the Sierra Madre mountain range is equally as pretty and much less crowded than The Alps, the climate has something to offer just about  everyone from high snowy peaks to hot sandy beaches, and you can pass through several completely different ecosystems/ climates within a short drive like going from the hot desert of Palm Springs up to the chilly alpine zone of Tahquitz with a quick drive just for the afternoon if you want to cool off. Or from Death Valley the lowest point in the contiguous USA to Mount Whitney the highest point. I really like that. The people are also generally pretty friendly in my experience, compared to other parts of the USA and most seem happy especially in the more rural areas and the farther north you go, again in my experience and I realize that’s an over-generalized statement. It’s an awesome state IMO.

    Geographically it’s bigger than many entire countries in the world. Politically it is very diverse as well with some areas being very conservative like Bakersfield, Redding, Newport Beach, San Clemente, Yorba Linda even San Diego has a lot of conservatives with all the military bases there from what I understand, and other areas are obviously very liberal. The Central Valley has some of the most fertile farmlands in the entire world where much of our food supply is grown. There are 2 major deep sea ports in LA and San Fran for import/ export shipping, tons of natural resources and many high paying jobs such as in Silicon Valley which is the worlds premier tech hub, lots of venture capital funding for startups and many billionaires, probably more real estate investors have become multi-millionaires through appreciation there than anywhere else in the USA besides NYC… the list goes on and on. 

    I don’t really know about the laws there because I don’t watch much Fox News but I also don’t think too many people buy property solely because of landlord/ tenant policy or petty theft laws and if they do they might want to reconsider that approach  because the places with the least favorable landlord/ tenant laws are typically the places with the highest appreciation and best overall returns. People should buy property based on jobs, economy, desirability and supply/demand factors not laws IMO.

    CA is a state that is bigger geographically economically and in population than many entire countries and is also very diverse in every way. It’s impossible to make a sweeping generalized statement about the whole entire massive and diverse state without coming across as a bit ignorant IMO. Even as far as laws go, I’m sure you can find the full range of local laws within the various diverse parts of the state.

    Personally I actually know a lot of investors who bought in cheap flyover states and later regretted that decision and sold at a loss, whereas I don’t know a single person who has told me “I wish I hadn’t bought property in California”. Most property owners in CA I know have actually made millions on appreciation. For example my cousin bought a place in Palo Alto near Sergey Brin’s house and has made more on it than he does with his very high-paying tech software job. 

    The population is also on the rebound as of 2023,  I believe it is growing again now after a few years of flat/ slight decline around 2020-2023. There are like 40 million people there so it’s not like it’s ever going to be a ghost town lol. 

    10Reply
  • Rob K.
    Encinitas, CA · Member since 2011 · 191 posts · 252 votes
    1y

    California like everywhere else has its cycles. During the great recession, It did not take much to find a property not to far from the coast that broke even or positive cash flowed with 20% down, but most folks didn't, so passed on buying. This negative psychology among other things resulted in a massive failure to build new inventory limiting supply while demand grew.  Lesson learned: anytime you can break even in California anywhere near the coast with 20% down, just do it and don't ask to many questions.

    Now, there is a lot of capital looking for anything near the coast and things are a bit pricey. This too shall pass. Now is just one point in time and one can make permanent judgements based on the perceived current situation but that might be shortsighted.

    As far as the politics and legal framework, yeah it can be a pain, but for those who understand it, it eventually becomes a competitive advantage. Proposition 13 fits well for a price volatile state like California and we don't have the ever moving out of state property tax situation to deal with in states like Texas. Tenant quality and demand is generally good and usually there are no issues with proper screening, at least for those with decent properties.

    But for all of the naysayers on California, keep it up. There is more than enough click bait and one sided information out there for confirmation bias. 

    5Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    1y
    Quote from @Steve K.:



    The population is also on the rebound as of 2023, I believe it is growing again now after a few years of flat/ slight decline around 2020-2023.

    Not so fast. They are playing with numbers. Below is from the state itself: Apparently it has slowed but still hundreds of people PER DAY exit the state if you look at NET numbers.

    "For nearly 20 years, California has experienced negative net domestic migration, in which the number of people moving out of the state in a year exceeds the number moving in."




    0Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    1y
    Quote from @James Wise:


    As for the weather, with all of this global warming,

    'All of this global warming' may be/probably is temporary in the big picture, just psrt of the cyclical nature of our wonderful planet. I personally would not base any business decisions on the weather....

    Just my $0.02...

    2Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    1y
    Quote from @Jay Hinrichs:


    and thats where I will end up shortly as well.. summer home in N> CA residence in tax friendly and winter weather friendly Vegas. And of course a bunch of grandkids there LOL.

    Lol, that may be my scenario as well afer all is said and done. Main draw of course being family (esp Grandkids :-)

    But substitute AZ for NV.....or maybe I should look at NV ?

    0Reply
  • Stephen Birnbaum
    Member since 2024 · 5 posts · 5 votes
    1y

    Sure, California has problems but it also has amazing weather allowing for a healthier lifestyle. Without traveling far, California has ocean/beaches, mountains, skiing, hiking, desert, lakes, rock climbing, wine country, and more. It's easier to eat local produce year round and eat a healthier diet overall. 

    1Reply
  • Bruce WoodruffPro Member
    Contractor/Investor/Consultant · San Diego / Phoenix · Member since 2021 · 12k+ posts · 15k+ votes
    1y
    Quote from @Stephen Birnbaum:

    Sure, California has problems but it also has amazing weather allowing for a healthier lifestyle. Without traveling far, California has ocean/beaches, mountains, skiing, hiking, desert, lakes, rock climbing, wine country, and more. It's easier to eat local produce year round and eat a healthier diet overall. 

    Cali has BIG problems. Huge. And you can find everything you mention (except the ocean) in AZ :-)
    1Reply
  • Ken M.
    Investor · Get yourself trained before doing something inadvisable. · Member since 2024 · 3k+ posts · 1k+ votes
    1y
    Quote from @Bruce Woodruff:
    Quote from @Stephen Birnbaum:

    Sure, California has problems but it also has amazing weather allowing for a healthier lifestyle. Without traveling far, California has ocean/beaches, mountains, skiing, hiking, desert, lakes, rock climbing, wine country, and more. It's easier to eat local produce year round and eat a healthier diet overall. 

    Cali has BIG problems. Huge. And you can find everything you mention (except the ocean) in AZ :-)
    and the ocean is a short drive away. Most people don't realize that their winter vegetables come from AZ. Oddly, Arizona has 3 ski slopes, with base at 9,200 feet above sea level. When the oceans rise 6" in the next 200 years, your arizona property will be dry. Yes, the rockies are part of Arizona. Texas is a little bit flatter but has a lot of land to buy.
    1Reply
  • Dan H.Pro Member
    Investor · Poway, CA · Member since 2015 · 7k+ posts · 8k+ votes
    1y
    Quote from @Bruce Woodruff:
    Quote from @Stephen Birnbaum:

    Sure, California has problems but it also has amazing weather allowing for a healthier lifestyle. Without traveling far, California has ocean/beaches, mountains, skiing, hiking, desert, lakes, rock climbing, wine country, and more. It's easier to eat local produce year round and eat a healthier diet overall. 

    Cali has BIG problems. Huge. And you can find everything you mention (except the ocean) in AZ :-)

     I have skied arizona (near Flagstaff).  No comparison to sierra skiing. also much shorter season.  I was there a few years ago and the resort opened at christmas break.   I suspect it was a poor year, but still.

    The lakes are reservoirs for the most part.  I go to some of the basins in the sierras and can encounter a dozen large lakes in one smallish basin.  I am not stating it compares to northern tier, but a lot different than arizona lakes.

    The ocean is very critical piece.   Not only is it a recreational source but it is a climate moderator.   It is why coastal Ca has so much lower temps in the summer than phoenix.  100 days plus over 100 degrees is not for me.  Especially as i have aged i find hot weather less pleasant. 

    I visit Arizona and enjoy visiting.  I like the national parks and monuments, tourist sites like tombstone, the best cave in the world (karchner Cavern: i have been to all of the us competition except for Mammouth), the best slot canyons (i prefer buckskin gulch over Antelope Canyon), the wave, black canyon (i have done black canyon many times), horseshoe bend, rafting cataract canyon, etc.  But i will choose to live in San Diego. 

    IMO all the CA problems add up to less than the temperature issue the Phoenix area faces.  As said already i do not like it hot. 

    I am glad people are choosing to leave.  Mostly they are leaving over cost of living.  It is not cheap to live in as desirable place as san diego.  In my opinion the large population (too many people) is the biggest issue in San Diego. Each person that leaves, makes the area nicer imo.

    2Reply
  • Allan C.
    Rental Property Investor · Member since 2018 · 826 posts · 810 votes
    1y

    spent today at the beach... 

    1Reply
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