The question is, "Who would buy an uninhabitable house for $400K?"

The news exploded over a new listing of a 1036 sq ft home that is uninhabitable because of fire, yet is listed at  $400K and received 17 offers.  Read: Uninhabitable Oakland House With Collapsed Roof Hits The Market for $399,999

Who would buy that? 

The answer is "Location, location, location."

It is a known fact that we have a severe housing crisis in the Bay area of CA, and perhaps in other parts of the state as well. By crisis we mean lack of affordable housing, low inventory of homes for sale, escalating prices.

In Paradise Park area of Oakland where this property is listed for sale, there are similar homes listed for sale:

• 2 bedrooms/2 baths, 3432 sq ft lot at $675,000
• 2 bedrooms/1 bath, 4000 sq ft lot  at $775,900
• 2 bedrooms/1 bath, 2700 sq ft lot at $699,999

What makes that property attractive?

It's right on the border of Berkeley on one side, Emeryville on the other side. Commuting would be a breeze via public transportation. It's near shops, restaurants The land is level. And yes, the weather is temperate -- no extreme heat, no extreme cold. 

Sticker shock.

For many, it's sticker shock. We most certainly had it. We came to the Bay area from Florida by way of Tallahassee and Orlando, where we measure lot size by acres, not square feet. For what we sold our 4 bedrooms/3 baths 3000 sq ft house with screened in pool, 3-car garage in gated community just 15 minutes from downtown Orlando, we couldn't buy a 1 bedroom/1 bath condo with deeded parking space in San Francisco.

Is it worth it?

But, for what we lost in FL, we gained in CA.  We've lived in Alameda CA longer than any other place. We love the weather where we can be outdoors most of the time. The soil is so rich we plant nearly anything and it flourishes. We don't need air conditioning because ceiling fans suffice. We have low utility bills because we don't have to turn on the heat too often. Commuting by public transportation is easy and we have a choice of ferry, express, BART.  

Too high for others.

However, for many, the high cost of living is one of the reasons why "California is a national leader in outbound moves."