Monday, November 8, 2010

The Real Estate Market Is All About Perception

It's incredible how differently people think about buying real estate now. 3 years ago, we were at the height of euphoria in our market cycle. Now, we are finally accepting that real estate doesn't always go up, and many home debtors are financially upside down. That combined, with banks not lending without a big chunk of skin and stellar credit, has turned the market to ice. Still ,we have yet to see the biggest shoe to drop, that finally clears everyone out. It happens every cycle, and this one is no different. The market will never come back, until some major event causes most to throw in the towel. With banks playing hide and seek and our government refusing to pull the plug, we could be in for a long drawn out process. That big shoe could very well be unemployment, which is the normal culprit in market downturns. In California, the "Unemployment Rate" according to government is a little over 12%. Most believe that's overly optimistic, by just looking around themselves. In last week's LA Times, they published statistics about voter demographics during the gubernatorial election. What caught me suprise was one category in particular. The question asked of ALL voters was :

Have you have been laid off within the last 2 years?

34% Yes
66% No

If that is indeed true, than unemployment and our housing market are in worse shape than anyone has led us to believe. How can someone risk their hard earned cash AND depend on such a shaky job situation that is now become the new norm. If this is our new reality, there is no way current home prices will be supported. Worst of all, with all of the negative sentiment, very few are even thinking about buying a home at current prices. It is all about confidence and perception, which isn't improving given our employment situation. Of course, there will be those that say "Now is the time to buy!, Rates are low, Prices have dropped" They are either industry cheerleaders, realtors desperate for a sale, or just plain out of reality. The question is, why are rates so low and still nobody is buying?

51 comments:

Sitting on the Sidelines said...

Why are rates so low? They are not. Many houses on the market are still listed at 2007 prices. Very vew houses are priced at 2003 levels (which is where I read they SHOULD be), and no houses are priced at 2000 levels (where they will eventually fall to before rising). It makes absolutely no sense to buy right now...there is still some serious falling to happen.

Anonymous said...

I agree with Sitting on the Sidellines. It is very smart to avoid buying right now. I don't think there is a single person on this blog that says it is smart to buy now. That is why no one is posting.

You need to get the conversation away from "is it smart to buy" or "why isn't anyone buying" All of that is obvious.


You need to move the conversation to "some people are buying now, what are the stories of the people buying right now, what are the motivations of the people buying right now?"

That will provoke some discussions and some interest.

Don't try to get anyone on this blog to defend the thinking of the people buying, just to describe it

I personally know a lot of people who have bought in the past 12 months. None of them are smart. It would be fun to discuss their purchase decisions, but NOT fun if you expect me to defend them

Anonymous said...

365 24th - 90402

Raw land. 1.9 million bucks. Are the people buying raw land for 1.9 million smart or dumb?

Anonymous said...

out of curiosity exactly what price are you guys waiting for? I want to know at what price any of you would finally go out and buy a house?

Anonymous said...

5:37 no one will answer because they don't want to split the coalition.

The people on this blog all feel like they need a community of other people. The community today is united in saying that prices will go down. Once you bring up the issue of where to buy, you split the community up.

Some of the more hard core people here are waiting for prices to equal three times income.

Look at the average income in Santa Monica. multiply by three. that is where they think home prices will go to in Santa monica

Latesummer2009 said...

Get out of town you troll. If you paid attention, you would know.

Anonymous said...

A response to November 9, 2010 1:36 PM:

I believe they also bought the lot behind it on 25th for $2.3. If so, the buyers are in for $4.2 with two tear downs, though they are now trying to rent out the house on 25th for $6500/mo., I assume while they do their plans. Value wise, this seems within reason for current market conditions.
If they do build one house on both lots, then the house on 1709 Georgina is a similar deal, newish construction and 18k+ lot and they can't get rid of it at $7mil...wonder what it will eventually sell for? My guess is it is worth $5.5, in this market.
Based on that, I am surprised how this 24th/25th st purchase of raw land for over $4mil makes sense, but I guess someone must have done the math and it works for them. If you follow North of Montana closely, you will notice most properties are selling quite quickly. I think it defies your thesis, Latesummer. I am not necessarily against your rationale, but what I see happening here (and I am watching this market very closely) doesn't mesh with it. However, I do think your rationale applies better looking at the broader trends.
For example, Brentwood Park seems to be lagging quite seriously - alot of overpriced teardowns on the market for around $5-6 mil which isn't flying with anyone - it seems that rarely these days will a speculator pick up land like that to build 10,000sq ft house and the math doesn't work for an onwer/builder, based on some very interesting houses on the market for $8-10mil...so this market is definitley heading downwards in the next year or two, in my opinion. I do see that there are a few RE agents that dominate this market and I wonder if they are avoiding moving the prices into more rational territory, or if the owners are reluctant to lower?
It also looks like Kenter Canyon and SM Canyons have been heading lower in the last 6 months, right? Does anyone have the trends of what spiked first during the bubble? Was north of montana first to rise (and will it be last to fall?). Hmm.

Anonymous said...

Franklin 90402 is more solid right now than all the other neighborhoods. Ignore the realturds talking up the market. It is soft everywhere but Franklin

Anonymous said...

It would seem to me that the doomsday hypothesis is getting a little old as the market has been dropping for 5 years already. And you guys keep talking about the market above say 2 mil. At those prices people who are buying in at or above have cash and don't care about the market crashing more. They care about buying a property in a good neighborhood, close to the ocean, with good schools. Then there are the 1mil to 2 mil people 2 incomes probably trade up and still needs a loan to get in. That market probably still has some room to drop because of the loan situation. Then there is the low end market sub 1 mil. I see bidding wars if the price is right 700-800k. My point being that the market Has stabilized on the low end and the high end does not care about what you guys are saying so that leaves the middle but if you look on redfin I see slot of sales in the last year and with rates coming down and the fed forcing inflation it's just a matter of time before the middle starts to stabilize too.

Latesummer2009 said...

Believe it or not, I would have to agree the Franklin Area around 2 million is the sweet spot right now. My guess is, these are not speculators, but families with cash, that plan on building and staying in the neighborhood for awhile. If that is the case, a long term (10 year) purchase of quality land, is a good hedge against inflation. Being one of the most desirable areas for a family and walking distance to everything, it has retained it's value better than everywhere else.

That being said, it doesn't mean the property won't still decline.

Anonymous said...

Can anyone speculate on who is actually buying right now? I know in my neighborhood (90405) the last few sales I was aware of were either 1) move up to bigger sq. footage and/or better location. 2) parents bought house for kids/grandkids 3) cheap lot value only deals

There are a couple new constructions on the market without a nibble for a while...that market is deader than a doornail.

Any other ideas on who the people are that want and are buying now???????

Anonymous said...

Can you help me understand the lot merger situation North of Montana vs on Strand in Manhattan Beach?

In Manhattan beach I have seen a number of families buy two Strand lots and scrape them both in order to build one larger home that takes up two lots

I have been told repeatedly that this is not allowed North of Montana that if a person owns two lots he is essentially only allowed to build a normal sized house on each of them or build a normal house on one and leave the other as a giant area for a yard or pool

So my question is, if a family owns two lots North of Montana can they build something giant that is in the middle of the two lots or rather just a normal new home on one and leave the other as a yard / pool area

Thank you for any help you can give on this

Anonymous said...

I agree the market is in the toilet and it will be for many years. In fact, I think it is likely that we're going into a Japan situation where real estate prices on the Westside will continue to decline for the next 10-20 years. If you factor in the price declines as additional interest, the effective interest rate on buying a home is quite high. The big difference between this interest and actual high interest rates is that you can deduct actual interest but not a decline in value. And this is a bottom up trend and 90402 won't be spared.

Anonymous said...

I agree with 7:18.

And in Manhattan Beach, if you spend any time around 8th and the Strand you will see the family that bought three houses on the strand and tore them down to build a large house on three lots. The family is super friendly with the mom active in the PTA and the dad often seen surfing in front of his house or BBQing on his covered front porch which borders the Strand. This family told me that after they built their house the rules were changed to encourage other families to buy two lots and merge them, but to forbid other families from buying three lots and merging them. As a result you see other double lot houses going up but no other triple lot houses.

Anonymous said...

11/9 - 9:32 is the winner. Seeing this market from the time we put our house on the market on a lark in Pac Pal in Oct. 2008, we have see the market dip a little, but the $2 mil and up homes keep moving. Even the $3-4 mil ones. What always surprises me whenever I come back to this blog (rarely now as it is the SOSO) is how the same mantra is always vehemently expressed, yet nobody takes into consideration that most of the west side people purchasing $2 mil plus homes don't really care if the price drops 10-15% in the next few years, they are not going anywhere anyway. Nor are they looking at this acquisition with profit making motives. If they walk away ten years from now and break even, there really is zero concern. If anything, they will probably lose more on the depreciation of the half a dozen cars they will buy over the next ten year than any real estate transaction. Your so oft noted two income, barely squeak in, middle class Joes and the cash buyers are apples and oranges in the Palisades, and i would assume in Brentwood and N. of Montana as well. Just a different class of folk with a different asset base and motivations which 99% of the posters, year after year after year, just don't get or wish to acknowledge.

Anonymous said...

10:40,

you ask why you can see this simple truth but no one else on this board can see it. I can answer you.

The reason is that the other people on this board take things at face value.

They see a neighborhood filled with middle income young families, they see the houses selling for ten times the average family income in the neighborhoods and they think that these young families are struggling to pay the bills.

What the people on this blog ignore is the family money. At least four of the people in my neighborhood who have purchased this year got the house as a gift from either the husband's family or the wife's family.

So the people on this blog visit a neighborhood and see people working in the same professions as them, making the same money as them and feel they deserve to live in the neighborhood too.

Bottom line, people on this blog don't understand multi generational wealth. The people on this blog should throw in the towel on being able to buy in "the promised land" and move to a place they can afford.

I bet many of the folks on this blog desperate and hungry to own in the promised land could move to Boulder or Portland or some other really cool place and live happily ever after. But instead they keep banging their head against the wall, dreaming the impossible dream

Ed said...

November 9, 2010 9:32 PM:
I agree with the low and upper end. The middle, maybe not so much. There's only so many people in LA that can afford to buy homes that cost more than 500K, and the westside will have to compete with other nice areas like palos verdes and beverly hills to name a couple. You could be right, and there may be some price resistance to a drop below 700K, but I think that bidding war will be strongly supported by the FHA jumbo loan threshold, and it will provide some extra breathing room for prices to stabilize as a even some of those loans default.

It would be helpful to see stats on the status of NODs and delinquent mortgages for homes in the different neighborhoods on the westside, and group them up into 1M+ homes and 500K~1M. This could help provide a better idea of westside home price trends.

Also: "with rates coming down and the fed forcing inflation it's just a matter of time before the middle starts to stabilize too"

Home prices cannot go up if the extra money supply does not end up with property buyers. Thus far, the Fed has only devalued the dollar and inflated commodities, and home prices (in general) are still in a deflationary trend. Unemployment has further pushed that trend. Fed's easing policy will not push home prices up via inflation. Not directly at least.

Anonymous said...

The bipartisan commission on national debt reduction just delivered their recommendations, which included eliminating or reducing the mortgage interest deduction.

Anonymous said...

90402 is down $150/SqFt per Redfin in about 2 years.

Oh, but that doesn't matter! It's the family money that's going to keep supporting this market. And, of course, nobody cares about losing three or four hundred thousand in a couple of years! It's all good. My property hasn't gone down in value!

What a bunch of idiots.

Anonymous said...

You only really lose if you have to sell in the short term douche nozzle. It's not all family money, obviously. Duh! There are also those who hit lotto on films, financial projects, tech, engineering, oh and even real estate. There are only so many homes in these desirable areas to go around and surprise, at least in the Palisades the 2.5+ homes are moving. Surprises me too, but that is the reality, deal with it. And I mean the upper tier nicely located ones, not the doggy fixers which languish on the market and go to REO or short sale. And trust me very few people who buy these homes look on a daily, weekly or even yearly basis in some frenzied panic at what their property value is or where it has drifted from one year to the next. So long as they were not one of the chumps that got snared in the sub-prime mtg. scams and should not be there in the first place, they are just living life, raising kids, working on projects - oh and having their car detailed weekly. The supra hyper check my valuation every week Zillow watching fuzz brain, is a complete speculator, believing in a "my real estate is an investment" philosophy which is utter nonsense if you are living someplace for a long period of time. One better better not be counting on their home to save them and have saved or otherwise accrued a cache of assets for the golden years or one is SOL nice westside home or not. That is another reality. But, I know Mr./Mrs. Bitter Lemons, it does not help you any to know that things won't be opening up for you anytime soon. They may go down a bit but you will forever be priced out, while fortunes are tossed back and forth between the upper tiers. And, yea on that! And, ya, it's all good sucker!

Anonymous said...

Oh, and should their be any question, I proudly live in one of the dogy fixer uppers! And detail my own cars! LOL

Anonymous said...

There is a lot of money on the westside. Period. And everyone wants to live here. Period. They ain't making any more westsides either and properties are being traded while the smart people are waiting the stupid people are buying. They are stupid because they are buying when no one wants housing. They are stupid because it's costing them less to remodel/ rebuild/ pay for materials and get a good builder for cheaper then 5 years ago. They are stupid because if they were smart they would be waiting for prices to go down even further when they have been going down for over 5 years already. These people buying houses now are really really dumb because they are screwing up where if you were to ever screw up on a real estate deal, do it in a desirable neighborhood near the ocean. Man these current buyers are really really dumb. They are so dumb they are leveraging themselves with mortgages when it's hard to get a mortgage and during the end of a recession. Man what idiots. If they were smart they would buy a house when the economy was ripping and everyone can get a mortgage and everyone has a job. All you smart guys know when unemployment is low and mortgages are easier to get is when us like minded people are supposed to buy when everyone else is buying. Was it Warren Buffet that once said buy when everyone else is buying and sell when everyone is selling?

Anonymous said...

Sounds like you are on your period. Keep lying to yourself. What a troll.

Anonymous said...

Hah! I agree. What a bunch of goofballs. Don't worry about prices! There's so much money on the westide nothing matters. Period!

Anonymous said...

But there is more money on the Westside than g_d has, don't you know that? The price of my house doesn't matter to me, I use dollars bills to have fires in my fireplace! Yipee!

Ed said...

"Was it Warren Buffet that once said buy when everyone else is buying and sell when everyone is selling?"

Actually, it was the opposite. He advised people to buy when others are selling, as it may provide some great bargains.

He's probably watching the commercial real estate market very closely, searching for the next opportunity

Anonymous said...

9:32 and others. What you need to understand is that these people wont get it, and they never will.

Happens with all the blogs. In the beginning, they are innundated with the extreme bears and a few permabulls - neither of which has any clue whats going on.

As prices fall, the permabulls leave and a bunch of moderate/bearish types come here to see what is going on and keep the comments sane. These types drive comment levels to the extreme - they dominated the boards late 2007 to early 2009.

Problem is, as those former moderate bears turn bullish and buy, they quit posting here and go on with the rest of their lives. All that leaves behind is the extreme permabears who (whether they know it or not) were priced out of these elite markets from day 1.

The thing about permabears (and permabulls) is that they never change. Thus, if you come here wondering if they will ever change their "impending doom" mantra, you will be disappointed.

We saw the same thing back during the early 90s So Cal meltdown. Back in those days, the AOL chatrooms had forums dedicated to the decline. The price declines pretty much stopped in 1993, but the most ardent permabears continued to believe it was "nowhere near the bottom" as late as 1998.

In fact, it wouldnt surprise me if some of the posters here now were the same ones who did not buy back in the early 1990s because they "knew" the market was still going down.

So you mods coming back, wondering why the thesis of this blog does not change - understand that it cannot. Asking them to accept that the market is not "due for a massive crash" is roughly akin to asking a devout southern baptist to accept that man is the result of evolution - it will never happen.

Anonymous said...

There is def. some good buying opportunities out there for the right minded person. Example is the Hill St. lot that sold last month for $575K. That lot would of been close to 900K 3 years ago.

You can't tell me there are not some screaming deals out there for the motivated.

The truly lazy buyer that doesn't want to hustle is the one getting left behind....

Anonymous said...

"Problem is, as those former moderate bears turn bullish and buy, they quit posting here and go on with the rest of their lives. All that leaves behind is the extreme permabears who (whether they know it or not) were priced out of these elite markets from day 1."

Maybe, but I think much of it is spillover from other sites.

Recently, Karl Denninger has banned certain posters who have (his words) "Masturbatory fantasies about collapse". When these guys are banned, surely the gravitate towards other sites like this one that operate as a safe harbor.

Not to mention with many of the other bubble blogs dropping like flies, the 1% most uberbears (which were formerly disbursed among several sites) are now concentrated in the few remaining ones.

Just my $0.02

Anonymous said...

Ed said...
I was being sarcastic!
10:42
Amen Brother!

Here's a history lesson for the doomsday sideline folks. This area used to belong to the indians, then spain, then mexico, then "americans". Then then this land was sliced up, diced up into smaller parcels, and those parcels were sliced into multi unit parcels(condos) so on and so fourth....and that has been going on since the begginning of time since the first caveman beat up his neighbor to take his cave too.....so keep waiting.

Anonymous said...

Wow... It seems to be 2006/7 here again. Funny. Anyone who does a modicum of research can see that prices aren't even close to bottoming. The westside market is not healthy at all. That said, if you find a place you can afford and plan to stay for a while, buy it. If not, there's certainly no hurry.

Anonymous said...

# of properties in some stage of foreclosure in:

90024 - 10
90402 - 17
90405 - 25
90049 - 60
90210 - 96
90265 - 88

Perfectly normal. Everything's fine.

Anonymous said...

To the anonymous buffoon from 10:42 today - 1993 was the bottom of the RE market in SoCal - REALLY? According to reality, the bottom didn't take place until a couple years after the other shoe had dropped (1994 Northridge Earthquake) - meaning 1996. All the historical charts - Case/Shiller, etc. indicate 1996 as the bottom of the LA/SoCal RE market from 1988 on. Sure, the ghetto areas bottomed faster, but just like today, that's not what we're here to discuss.

So please spare us your bullshit "back in the early 90's on AOL chatrooms we were talking about it too!" nonsense. If that's really the case, then what are you doing here? Blathering online for close to two decades about real estate? What a loon.

Latesummer2009 said...

It doesn't really matter if you are a bull or a bear. You can argue opinions either way. But, facts don't lie. And the facts are:

1) Properties have continued to decline on the Westside since the Summer of 2007.

2) Fake financing is GONE

3) Foreclosure has definitely arrived on the Westside

4) Our economy is in a deflation spiral, with everyone eliminating debt, instead of taking on more.

5) There's nothing on the horizon that would cause housing prices to increase.

6) Possible elimination of the mortgage interest deduction

7) Tons of Inventory, both shadow & regular

8) Continued job layoffs and wage cuts

9) More and more bank bailouts, QE 2,3,4,5 (pushing on a string)

10) Lack of state tax receipts decimating the state budget.

11) And on and on and on. etc.. etc.. etc...


We are in deep doodoo folks.


Read the writing on the wall. California's FIRE economy is gone and nothing has stepped in to replace it. This is not your garden variety recession. It's a major paradigm shift

Anonymous said...

Personally I think that prices will go back to early 80's prices. This blog is waaay to positive. I'm going to sit on the sidelines until I see houses north of Montana in the 150k range. I think if I wait long enough it will eventually get there. I agree with 3:11 things are not normal. Look at all those foreclosures 300 or so out of 49000 or so housing units in Santa Monica that is absolutely insane!

Anonymous said...

I am a native of Franklin 90402, After leaving CA in 2000 for several years, I returned to find my community overrun with this property speculation insanity.

Ironically, even with a very strong combined income, wife and I cannot afford a home in the same neighborhood my gardener lived when I was growing up! He was a decent guy, and I am not making any judgments about working class vs. white collar- we are all just people trying to make it. It is just that I find it ironic that I now couldn't afford his house, even though I have earned an PhD, and my wife is leads a large organization. I actually went to my old gardner's house when I was a boy and purchased a couple of minibikes off of him. It was simple, a 1940's cookiecutter south of the 10.
I wasn't born with a silver spoon in my mouth, and back in those days Santa Monica was a sleepy middle class town. I always assumed I would buy in the Franklin 90402 when i grew up.

Instead I can't even afford to buy in Santa Monica south of the 10. What i didn't account for, and I can vouch for this having medlived in several states outside of CA, is the "X Factor." Basically, I didn't take into account that a majority of people in states across the US would give anything, and I mean anything, to live in Santa Monica. They migrate to SoCal looking for the "good life" and they bring their parents money and often their grand parents money
These folks bought next to a sketchy housing project (Mar Vista Gardens), they bought next to old-school dudes who cannot even afford to fix and move the cars rotting in their front yards, or guys who live in dilapidated family homes because their blue collar pensions, are too small to keep up with the rising costs in these areas.

So even the skanky areas of Santa Monica are permanently out of reach - forget about the Franklin 90402. Our esteemed moderator actually commented on how land in the Franklin 90402 is a reasonable investment at 1.9 million. Factor in 1.1 to build a decent house and you can't touch a new build in the Franklin 90402 for under 3.0 million.

All of the newcomers have permanently put it beyond reach

Anonymous said...

This site is very helpful to balance what you hear. You hear so much hype when you talk to agents and homeowners. When you stop and analyze all the factors, it's hard to find a reason that real estate prices will increase. I heard about the mortgage interest deduction tax debate. Even if they don't do anything about it, just hearing it is enough to scare a lot of people. As if things aren't bad enough, that is going to send a deeper chill among potential buyers.

Anonymous said...

@November 12, 2010 8:03 PM:

Nice of you to repost the little story you posted a year or two ago. :-/

Anonymous said...

"Look at all those foreclosures 300 or so out of 49000 or so housing units in Santa Monica that is absolutely insane!"

It must be really hard for you to find out everything you believed about real estate is wrong.

Anonymous said...

8:30pm....how many times have you posted that same entry?

Anonymous said...

Ignore the realturds. Or is it realtards. They want u to stretch to buy. Don't listen

Anonymous said...

I caught that too 9:09. Nice cut and paste! Whatever, I'll check back and see how our "sky is falling" folk are six months from now. Let me guess, it will be the same ole, same ole.

Anonymous said...

The California legislature has been called into a special session to deal with a $24 billion budget deficit. Do you know what that means for the California economy? It means they are going to pull $24 billion out of the economy. Fewer jobs. Lower profits for business owners. Fewer services. Not good for real estate, at all.

Anonymous said...

CA is, to say the least, not doing well and continuing its decline. Companies are leaving both So Cal and No Cal. This is going to continue/accelerate with JB taking the governorship. So why would anyone buy now? All this uncertainty means renting is better, even if renting is a bit more than buying. Of course, on the Westside, renting is signficantly cheaper than buying. Who cares what the interest rates are?!

Anonymous said...

here is the question for those on the "prices are good now that they have dropped 5 years" gang:

why were prices so "low" in 2000 compared to 2005 and also 2010? No need to speculate about family money or other facts, as the family money was just as there in 2000 as it is now. And there were just as many folks with $$$ then as now (or is that not the case?).

Essentially, why shouldn't prices revert to the "norm" for all the high-end neighborhoods over the next years? They either were too low in 2000 (if so, why?), or we are too high now.

LOGICAL ANSWERS IF ANY WILL BE GREATLY APPRECIATED.

Anonymous said...

8:03 PM -- you posted this identical post before - cut and paste

if you can't afford south of the 10 freeway in SM, you are not really part of the discussion for 90402 no matter what prices do

the real point of bears here is why folks who make $500k and up still would find 90402 pricey today and want to sit this one out for a couple more years, even if they can get a loan and buy a house there without too much of an issue

Anonymous said...

LOL, as if people/households making $100K (let alone $150K, $200K, $250K and up, $500K and up LOL) are anything but incredibly rare, even here in incredible, sunny SoCal/west LA. The bulk are "fake it 'til you make it". I believe the current census breakdown is 5 times as many Los Angeles/SoCal households make the top income brackets as the general US population, but even so that leaves households in the southland at under 2% of SoCal at $500K and up...less than 3% at $400K and up...less than 7% at $250K and up...less than 10% at $200K and up...less than 15% at $150K and up...less than 10% at $100K and up.

Anonymous said...

whoops make that "less than 20% at $100K and up for household incomes in LA County

Anonymous said...

10:35am -- you are completely not facing reality. There are a TON of westsiders who have incomes at $500k and above, and then there are the double-income families... All you need is two average lawyers and you are at $500k and up.

Anonymous said...

Agreed 8:56, agreed. These people are wedded to believing things are only "one way" and there is not more to the picture is what makes this blog more for occasional entertainment than anything else. Most of these people have no idea the makeup of 2010s westside, the buyers, the holders, the families in. Just ridiculous speculation and doomsday predictions. Lotsa luck!

Anonymous said...

Sorry... The dual income lawyer family making 500k+ has got to be about as rare as a woman having triplets. All the rich lawyers i know have trophy wives who make no money ... Just spend it.