Blog

Short blog posts, journal entries, and random thoughts. Topics include a mix of personal and the world at large.

My time is now

Break out the winter blankets! San Francisco weather has gotten properly chilly now, which is just fantastic. You do have winter blankets, right? Who can afford to heat the home during slumber hours? Besides, I’m Asian: winter heating is for emergencies only, not a regular occurrence.

Granted, I’d for sure be singing a different tune if I lived in a place with a true winter.

The dream of course would be to have a house with enough solar panels and batteries to climate control the home year round. But that’s putting the horse way before the cart. Can I even buy a house, anywhere in the Bay Area? Get back to work, peasant.

San Francisco has a low income home buying program for people like me. Don’t let the low income term fool you though because it’s all relative. You can cross six figure annual and still be too poor for housing in this town. The issue I have with the program is that what’s available are all condominiums. Single family home? Not a chance.

I love condos, just not in this country. In Asia with fast and reliable public transportation, and many shops clustered in neighborhoods, condominiums make sense. Car ownership is entirely optional. Here in America, it’s the opposite - and that’s okay! That means the one bedroom on sale for $400,000 with no parking is not going to work.

Then there’s the HOA fees. I don’t see how this one bedroom gets resold when the monthly HOA fee (nearly $1,700) is likely more than the monthly mortgage. Even at the more normal $500 - $700 going rate, I feel like I’m not getting an enough return on that money. Mortgage payments are a kind of stored value; taxes, insurance, and HOA fees are gone forever. Nothing we can do about taxes and insurance, obviously, so HOA is best avoided.

Honestly, if I’m putting down some considerable sum for a home, it’s got to be a proper single family house, with a garage and a yard. My own kingdom that’s beholden to no-one, except for the municipality collecting taxes. This may not happen anytime soon, given the Bay Area housing market, and my current meager salary. But opting for the SF home buying program would simply be an ultimately unsatisfactory solution.

50 years a mortgage

President Trump is floating the idea of a 50-year mortgage loan, superseding the current standard longest of 30 years. I think it’s a wonderful idea, because I can finally afford a home around here! All it takes is for a bank to practically own me for the rest of my life. If I were to buy a house today and it’s a 50 year loan, I will be 87 when the final payment schedule hits. Will I even be alive by then?

In simplistic mathematic terms, the 50-year mortgage makes sense. Housing is expensive, so let’s extend out the loan term so people can “afford” it. It’s the same thing happening in the automotive industry. The average new car price crested over $50,000 recently. Along with it are ever longer loan terms. 60-month used to be the maximum standard, but now 72 or 84-month is popularizing. Just so folks can squeeze in a monthly payment that is somewhat palatable.

Is that not a similar goal in floating a 50-year house loan? Perhaps it’s too big of a jump from 30? For sure 50 years will be more than half a lifetime for most of us. Also, think of the amount of interest that’s going to be paid for a loan that long. You can more than likely buy a whole other house on total interest payments alone.

But I think it’s a problem only from an investment lens. For a home that you want to stay in forever until death, a 50 year loan doesn’t seem that ridiculous. So what if the cumulative interest payments amount to a crazy high number? The most important number is for the monthly mortgage cost to come beneath an affordable threshold. Indenturing myself to a bank for the rest of my life is quite alright if I get a stable and comfortable home in return.

Surely the banks also wouldn’t mind that extra 20 years of accrued interest! I think mortgage terms longer than 30 years should be made available; as a tool, an option, but not a panacea to a problem.

Reward without the work

In conversations with my aunts and uncles back in my home country of China, I’ve come to understand the supposed ennui of Chinese millennials (and younger). The “lying flat” movement that’s been popular on social media (until it got taken away). Young adults of the country are dissatisfied with the high-pressure achievement culture, and therefore are instead opting out of contributing to society (and themselves) in any meaningful way. Let’s just work enough to sustain.

I now see where the dissatisfaction stems from. Retired folks like my aunts and uncle are really living the good life. Government pensions are relatively generous, and retirement age relatively low (60 for men, 50 for blue-collar women workers that my aunts belong to.) Back in the day, these people were also provided with government-sponsored housing, or were able to buy a flat when it was insanely cheap in comparison to the real estate bubble of this millennia.

Chinese retirees own there flats outright, and are drawing a healthy monthly income from the government. This legion of folks goes out to eat all the time, and travel domestically and abroad whenever they fancy. We’ve all heard of the “Chinese dama” phenomenon: middle-aged Chinese women going on a tours and wrecking havoc on the local citizenry.

The younger generation see this with great envy. Principally because the price of a home - as it is anywhere in the first world - is astronomically unaffordable in China. And honestly, who doesn’t want to eat out at restaurants all the time? Traveling is also best done when you still have some youth and vigor. (That’s why I don’t regret spending a ton of money on travel this past decade of my late 20s and early 30s.)

You can see the problem: Chinese millennials want to skip right to what their parents have - without putting in any of the (long) time and work. This is the same reason people gamble on the stock market by throwing it all in on GameStop. The slow and steady growth is too boring and not fast enough. Now is a good time, not tomorrow. Social media showing the highlight reels of everyone else certainly doesn’t help the situation.

But monetary physics doesn’t allow for instant, overnight wealth generation. So in the face of an immovable object, it’s the easy way out to instead hate what you want. Who needs to own a home? That’s stupid. Working long hours to climb a corporate ladder for wealth? That’s just some societal bullshit. Travel? The home is where it’s at. A smartphone with an unlimited cellular plan is all that’s needed.

That’s lying flat in a nutshell.

It's housing, stupid

It seems my place of employment is not the only education system in dire financial straits. The San Francisco United School District (SFSUD) is facing a budget cliff as well. There’s been talks of school closures this year, but election season sort of put a kibosh on that. Now that the election is over, and the math remains terrible, I don’t see how they can avoid contracting the number of campuses.

SFUSD has the same problem as SFSU: a massive decline in enrollment. Funding from California is tied to pupil count, so less students, less operating budget. Hard decisions will have to be made. San Francisco State will be laying off lecturers and cutting courses come the Spring semester. I can tell you the atmosphere on campus is rather bleak these days.

I think this issue ties back to housing, or the lack thereof. How can you expect a thriving K-12 student population when the working-class cannot afford to live in San Francisco? It’s financially difficult to start a family here if you’re not of the upper crust working in tech or finance. People of those means are more likely to send their children to private school, exacerbating the enrollment problem. Public education needs a robust working-class to support it. San Francisco must build way more housing, driving down home and rental prices, to sustain said working-class.

Until that happens, SFSU must build way more student housing so students can actually afford to attend. The university isn’t renowned for anything in particular, so San Francisco becomes the de-facto draw. Tuition is expensive enough as is; it’s a tough ask to then add on one of the highest cost of living in the country. Never mind the retail crime, homelessness, and fentanyl crisis that gets shown on television.

I believe solving the cost of putting a roof over your head is the main lever to pull here.

Can't return a house

Not that I could ever afford to buy a house here in the San Francisco Bay Area. But, if I were hypothetically able to, it’s kind of a crap shoot, isn’t it? I’m talking about one thing you cannot change after you’ve bought a house: bad neighbors.

Buying a house in a supposedly “good neighborhood” is no guarantee of good neighbors either. Sure you may not have to content with the constant loud music and occasional robbery shooting. But maybe your new neighbor next door runs a wood-working shop out of his garage. Good luck concentrating with that ruckus whilst trying to work from home. Because you do work from home, right? Who can afford a house around here without a remote software engineering job anyways.

That’s why I am a fan of renting (and not just because I can’t afford a house). The longest I would be ever stuck with a crappy situation is one year. Heck, if it’s truly unbearable, I’d have no problem paying to break the lease and get out of there. You simply cannot do that with a 30-year mortgage! Call up the bank and be like: “Yeah, I would like to return this house…”

It’s too bad you can’t test-live a home. Move in for a month, and if your neighbors happens to be from hell, you have an escape clause.

I actually like the idea of homeowner associations. There’s a clear set of agreeable rules that every homeowner in that subdivision has to abide by. If Jacob next door likes to practice guitar late into the morning, a polite email to the HOA will take care of that quickly. HOA takes care of any potential bad neighbors anxiety because the rules are typically what a civilized society should be: don’t intrude on others.

A tall crane

My neighborhood is the residential type with homes no taller than three stories. The tallest thing nearby is San Francisco State University, of which the highest building on campus is nine stories. The university is in the middle of constructing a new science building. Consequently, a giant crane have been erected for that purpose. This thing absolutely dominates the skyline, and honestly, a bit of an eye sore.

I get it now: I can see why NIMBYs all over protest against tall, dense housing. It’s not very nice to have your horizon of pure sky suddenly get obstructed with some monstrosity. What NIMBYs have to do is admit that is the real reason for their opposition - in additional to lowering the values of their home, of course. They chose to buy in a suburban area, and indeed it would suck to have that changed from under them.

Saves us the "we don’t want luxury apartments and developers to get rich” bullshit.

Just because I understand NIMBYs, doesn’t mean I am with them. San Francisco need to build more housing, full stop. And it cannot all be concentrated in the north east part of the city. Our nearby Stonestown mall is planning to develop addition apartments and shop areas to surround the existing mall. It’ll be interesting to see if it gets approval, because the skyline of our neighborhood will be changing with it.

Who knows if I’ll even be around to see that come to fruition. Not because I’d be dead, but because I might have moved away. Major constructions in this country - unless it’s a stadium/arena for a sports team - takes a long time. That aforementioned science building at San Francisco State won’t be complete for another four years!

I get it now

A few nights ago I found myself in the Tenderloin district of San Francisco. Arguably the roughest neighborhood in the whole city, it has everything the naysayers warn about. Massive amounts of loitering, likely drug deals, homeless population living on the streets, littering everywhere, and a general cloud of loud noises. Paradoxically, sprinkled in between all of this are new condos, the symbol of gentrification.

Honestly though, who would want this status quo? It’s nice to see some signs of improving the situation. I understand why NIMBYs get up in arms whenever there are talks of low-income housing or housing for the homeless getting build in their neighborhood. For better or worse, the Tenderloin shows that looks like, and people are afraid that if such housing gets built in their proverbial backyard, the negative externalities get brought along as well.

No one wants to live near loud noises, drug use, and loitering. I grew up in the poorer parts of San Francisco so I’m familiar with all those things. Moving to the west side of the city was in part to get away from those public nuisances. It’s probably dubious to equate low-income/homeless housing to having those negative qualities, but that’s the perception! That’s what I grew up with, that’s what everyone see when visiting the Tenderloin (excellent Vietnamese food there).

This isn’t a defense of outright NIMBY-ism. Surely there’s a non insignificant amount of NIMBYs whose fears are exactly as I described above. The character of the neighborhood they want is quiet, clean, and unobstructed. You can argue those fears are irrational, but how can you see what’s going on in the Tenderloin and not draw some similar thoughts and conclusions?

I couldn’t.