I posted this on r/RealEstate too but I guess it's a different population there. Today I saw a post that kinda make me regret buying a home in the Bay Area in 2021. Basically the post claimed:
- Cupertino, CA SFHs are strongly related to APPL stock price. Same as SF Bay Area housing price strongly related to QQQ price.
- Cupertino Median SFH price went from 1.41m in 02/2013 to 2.45m in 02/2023, which is a 1m net increase. Assume we bought it with 280k downpayment and 6.3k monthly mortgage.
- In Cupertino, 3 bedroom rent price has been around 4k in the past ten years. If we had choose to rent, put in that 280k downpayment in APPL stock back in 2013, and use the 2.3k monthly cash flow to invest in APPL, we would have ended up with a yearly return rate of 25%.
Since bay area housing price is strongly related to tech stocks, does this mean people should rent in the bay area?
Now I am feeling very bad about putting down a lot of cash in a 1.2m townhouse back in 2021, although at the time I thought it was a deal since the comparables sold for 1.35m. But again, is tech stock just a better investment than bay area houses?
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