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Which Occupations Are Priced Out of Homeownership?
- exolymph 11y ago1) toggle to San Francisco 2) weep
- raverbashing 11y ago3) Work remotely from Detroit
- xiaoma 11y agoThe vast, vast majority of companies in SF are uninterested in hiring remote software engineers.
- raverbashing 11y agoI wonder when will they pull their heads out of the sand It works for RedHat but I guess remote working detracts from the love of pointless meeting and daily face-to-face contact by upper managers
- Tistel 11y agoI think thats it. 1/4 to 1/2 my day is pointless meetings. Some days its 100%. Every company has those odd people who just go to meetings all day (or so it seems). When they are not in a meeting they are sending slack/email about past and future meetings. I don't understand the appeal of those jobs. They are just black holes for productivity. The only time I can concentrate for long periods (which is vital to programming) is if I stay late. I get more work done from 6PM to 8PM than I do all day. But then you have no life. Even working from home is so much more productive. Remote work is great if you can find high paying gigs.
- deleted 11y ago[deleted]
- ZeroGravitas 11y agoI guess if you were the kind of company that would hire remote software engineers, then you'd have very little reason to have the rest of your operation in expensive SF either, so there's a weird chicken-and-egg loop there. There seems to be enough money sloshing around that you'd think someone would be arbitraging it successfully and employing rockstar programmers that live in cheap shacks around the country/globe, but apparently for the mainstream that's not considered viable.
- eitally 11y agoThis happens more than you think. There are plenty of ex-tech engineers who started their own contract dev companies with just a couple of local (SFBA) folks who run things and assign work to inexpensive programmers, designers, etc elsewhere in the country/world. Typical current contract dev rate in the SFBA is in the $250/hr range (negotiable down to $150-175/hr for larger contracts).
- raverbashing 11y agoAt those prices this is the yearly salary for a lot of people
- imh 11y agoI'm curious how they arrived at affordability as a function of income. I'm surprised they weren't transparent about that.
- mytochar 11y agoWhat about when you have student loans? That reduces your effective income and makes it more difficult to afford a home. Same with a car.
- JeffreyKaine 11y agoInteresting that NYC isn't included but SF is.
- ryankupyn 11y agoThis is interesting, but consider that income varies widely by location, and is generally higher in areas with a higher cost of living. Both restaurant servers and computer programmers make more in San Francisco than they would in Scranton.
- pawelk 11y agoI think they have accounted for that. FTA: > After finding the average annual salary for each profession in each city from Glassdoor, Estately then determined how much people in each profession could afford to spend on a home
- adevine 11y agoThat's accounted for in the study. They looked at salary info from Glassdoor for each profession by city
- bshimmin 11y agoI'll be honest and say my key learning here was that astronauts don't earn all that much money (and presumably none of them are homeowners in SF!).
- craigds 11y agoMe too. I guess I figured astronauts must get risk pay. If you're an astronaut you have a sizable likelihood of dying on the job. Then again, this is probably just supply and demand. Every kid growing up wants to be an astronaut, and very few get to.
- ekianjo 11y agoAstronauts fly very rarely though. Most of them are training for years and get very little chance to be actually sent to space.
- poof131 11y agoSure. But when you do fly I’d say it’s pretty risky.[1] Even some of the training can kill you. Seems more risky than a typical desk job, but maybe that depends on how deadly boredom can be. [1] https://en.wikipedia.org/wiki/List_of_spaceflight-related_accidents_and_incidents https://en.wikipedia.org/wiki/List_of_spaceflight-related_ac...
- deleted 11y ago[deleted]
- delazeur 11y agoFor context: 4 out 301 spaceflights have resulted in fatalities, or 18 out of 546 people who have been to space. 13 people have died in training, but I have not been able to find the total number of people who have trained as astronauts or cosmonauts. I suppose we would also have to account for health risks due to spaceflight: radiation exposure, accelerated aging, respiratory issues among Apollo astronauts due to lunar dust in their capsules, etc. It's certainly riskier than a desk job, but it still doesn't seem that risky to me. [1] fatalities in space: https://en.wikipedia.org/wiki/List_of_spaceflight-related_accidents_and_incidents https://en.wikipedia.org/wiki/List_of_spaceflight-related_ac... [2] number of spaceflights: https://en.wikipedia.org/wiki/List_of_human_spaceflights https://en.wikipedia.org/wiki/List_of_human_spaceflights [3] number of people who have been to space: http://www.worldspaceflight.com/bios/stats.php http://www.worldspaceflight.com/bios/stats.php [4] accelerated astronaut aging: http://lemire.me/blog/2015/12/01/the-mysterious-aging-of-astronauts/ http://lemire.me/blog/2015/12/01/the-mysterious-aging-of-ast... [5] Apollo respiratory issues: https://en.wikipedia.org/wiki/Adverse_health_effects_from_lunar_dust_exposure https://en.wikipedia.org/wiki/Adverse_health_effects_from_lu...
- unixhero 11y agoEvery one except the real professional occupations, like lawyer, doctor, pilot, auditor, ibanker
- usaar333 11y agoWould really like to see some methodology here. I find it extremely hard to believe that programmers can only afford 4% of SF's housing stock, but doctors can do 41%. Sure doctors might make an average of $175k while programmers pull $100k, but by the time the doctor exits residency, the programmer will have earned about $400k+ post-tax while the doctor is $200k in debt. It'll take quite some time (12+ years) for a post-tax salary difference of $36k to make up that imbalance.
- johnloeber 11y ago> After finding the average annual salary for each profession in each city from Glassdoor... Yeah, they don't take into account critical factors such as estimated student loans or time invested.
- superuser2 11y ago>programmers pull $100k My understanding is $110k is an unsurprising entry-level salary; people who are mid-career would be making quite a bit more.
- withdavidli 11y agoThere is something really off about these numbers. unless i'm totally off about how many entry level employees are in the area vs mid/senior level employees. Since this data is collected by people reporting their salaries, I think that people that are more junior are more likely using and submitting their salary info to the site. This will skew salary data toward entry level employees. I also see Glassdoor is accounting for stocks now, though that's not factored into avg salary, but total comp. Looking at some companies this raise compensation by ~$50k.
- pmiller2 11y agoI would say that counts, provided it's actual stock and not options. If it's actual stock, it's liquid, which makes it almost as good as cash for most purposes.
- deleted 11y ago[deleted]
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- bdrool 11y agoRestaurant servers at zero percent? I know some who own houses in the Bay Area. Shit, I don't own one, but I know multiple restaurant workers who do. Granted, these people don't exactly work at the Olive Garden (we're talking at least one Michelin star), but it's not as simple as this article makes it out to be, not by a long shot.
- ptaipale 11y agoRestaurants with Michelin stars are so rare that their servers, even if they do better than others, probably won't make a dent in the zero percent. Their impact on the average earnings of restaurant servers is negligible. Overall, this study is very US-specific, of course. In some industrial countries the norm is to rent and only a minority own their homes anyway.
- TheCoelacanth 11y agoIt's what percent of houses someone making the median wage can afford. Not what percent of people can afford a house.
- 746F7475 11y agoteachers in general earning $50k, either teachers have to super good in U.S. or this doesn't include everything like high school, elementary schools, kindergardens and whatever else there is.
- withdavidli 11y agostarting pay in cities is usually around $40-45k. it goes up the longer you're there. i had middle/high school teacher that's been doing it for 20yrs making 100k+.
- yardie 11y agoIf they are making that there is no way it's just for teaching. I assume they have some administrative/leadership work involved. And probably a few degrees as well. When I was in school my freshly minted Calculus teacher was earning $60k with her MS Math. My English teacher, $120k, was also the English curriculum coordinator and had a PhD.Ed. And experience counts. The green, math teacher could barely keep a bunch of pubescent teenagers in their seats. Some of the exchanges were borderline sexual harrassment. The English teacher knew how to command a classroom.
- deleted 11y ago[deleted]
- ap3 11y agoIn San Diego teacher's salaries are set according to a schedule. Fresh out of college you start at 40k and can increase to 90k after 15 years. But you can increase by doing clubs or other activities + advanced degreees. The downside is if you are a superstar teacher straight out of college you still make 40k. Similarly if you are a crappy teacher after 15 years you still make 90k Thanks unions!
- yardie 11y agoFirst year, superstar teachers (which I truly believe are unicorns) have options to make more money. They can get advanced degrees or work in poor performing schools with federal funding. The former takes time and the later no one honestly wants to do. I don't think even superstar teachers can do it year after year. As far as pay. Like most jobs the first few years are low with a steep curve. Then it tapers off to COL increases once you've put in many years. This can be said of any job. Union and nonunion.
- golergka 11y agoWhy in the lower chart there's only one salary figure for each profession, without different values for different cities?
- kelly-estately 11y agoHi there, We showed the median national salary for reference, but for the city calculations, we used local median salaries. Kelly from Estately
- kqr2 11y agoActually if you are a firefighter in San Francisco, you can qualify for a special downpayment assistance loan of up to $200,000 that requires no payments for 30 years http://sfmohcd.org/first-responders-down-payment-assistance-loan-program-frdalp http://sfmohcd.org/first-responders-down-payment-assistance-... Also starting salary for SFFD is from $72,670.00 - 112,190.00/year which doesn't include overtime. https://www.jobaps.com/SF/sup/bulpreview.asp?R1=CCT&R2=H002&R3=900310 https://www.jobaps.com/SF/sup/bulpreview.asp?R1=CCT&R2=H002&... Firefighters are actually some of the highest paid city workers. In 2013, 31 of the top 50 earners were from the SFFD. http://www.sfgate.com/bayarea/article/S-F-Fire-Dept-dominates-list-of-highest-paid-5085237.php http://www.sfgate.com/bayarea/article/S-F-Fire-Dept-dominate...
- EliRivers 11y agoStrong unions negotiate good wages. Good for them.
- unpopularop 11y agoGood for them. Bad for the taxpayer.
- EliRivers 11y agoStrong unions are symptoms, not causes. Blaming unions because rich/powerful people have a tendency to fuck over the powerless is exactly what the rich/powerful want you to do. The rich and powerful benefit far more from low taxes than the stereotypical "tax payer". Addendum: for God's sake, your precious karma score is a number on a website. If it matters to you so much that you create new accounts to say something people might not like, you need to take a long hard look at yourself.
- pessimizer 11y agoReply to addendum: Pseudonymity is not anonymity - a lot of people post here under a handle known to friends and/or coworkers (or generally prefer to post without hiding their identities.) They may be posting under throwaways in order not to be judged for their opinions IRL (or fired for them.) So it's not all magic internet points.
- atemerev 11y agoI wonder when there will be headers like "homeownership is unsustainable".
- atemerev 11y agoAlso, an interesting observation: a "computer programmer" (presumably with median income) will be able to afford 100% of homes in Detroit! Each one of them!
- jenscow 11y agoWhat about houses with more than one income?
- terramars 11y agothis is garbage, the geographic variation of salaries are significant (maybe not for teachers or servers, but for others certainly). also, all the astronauts live in florida or houston ;)
- mathgeek 11y agoDon't you spoil my kids' dreams of being astronauts while living in San Francisco! /s
- kelly-estately 11y agoHi there, We did take the local salaries into account in our calculations. They actually do vary quite a bit for teachers! For example, the median teacher salary in Chicago is $71k, but it's only $52k in St Louis. Kelly from Estately
- amgin3 11y agoIf you live in Vancouver, every occupation is priced out except maybe CEO.
- jholman 11y agoVancouver (my city) is always rated as less affordable than every other Canadian or American city (except maybe NYC). And yet somehow I am a homeowner (mortgage-holding, not outright) in the city of Vancouver proper (not in a cheap suburb), which I purchased when I was making the most I'd ever made in my life, $50k/a (Vancouver junior dev salary around 2010). What can we conclude from this? The only conclusion I can reach is that most people who complain about not being able to afford real estate are merely people with unrealistic expectations about what type of home they "need". I just can't make heads or tails of it otherwise. Note: sure, some people really are locked out. If you're a 22yo single parent with no marketable skills and having to work 60 hours a week to feed your kids and etc-etc-etc, you're authorized by me to complain about your real estate woes.
- mistermann 11y agoI conclude that you haven't looked at prices in Vancouver proper lately.
- bozo1979 11y agoI recall reading stats of 50% year on year recently. So GP, check your house price and pat yourself on the back. Rest of us aren't so lucky.
- jholman 11y agoSorry, that's wrong. I've checked my home price, and I know what every unit in this building sold for this year. And I have, to some degree, been keeping an eye on alternatives in the Vancouver market. Insufficiently lucky? No, those who "cannot afford real estate" are (in most cases, as disclaimed above) insufficiently disciplined and/or insufficiently realistic.
- hackerweb 11y agoI'd love to be able to hire developers for $92K/year in SF, but these numbers are completely off base for average salary. Even offering $160-200K (plus options), I probably lose half my recruiting battles to big companies offering total compensation in the range of $450-800K/year. Who do you think is making housing so unaffordable? It's the tens of thousands of software developers earning $200K-800K/year! Of course, there is an above-average number of super-rich entrepreneurs in SF, but that's still only a tiny fraction of the population compared to developers. Moreover, the city makes it virtually impossible to combine apartments or houses into mega-mansions, so even the super rich don't consume that many housing units per-capita in SF.
- IndianAstronaut 11y agoWhy not build up? You don't have to even go too high. Just take existing housing or strip malls and add a floor. So many strip malls in the valley and peninsula that could be repurposed to have a dual purpose shops and condos/apts on top. Just one or two floors added would mean tens of thousands of new housing units.
- hackerweb 11y agoUltimately, supply is the only solution. But there are very tricky political issues involved. See, e.g., http://techcrunch.com/2014/04/14/sf-housing/ http://techcrunch.com/2014/04/14/sf-housing/
- deleted 11y ago[deleted]
- mtbcoder 11y agoA similar thing happened in DC. Defense contractor bubble rapidly expanded in the '00s, housing prices shot up drastically.
- eitally 11y agoWhat % of developers are you seeing get 450-800k/yr offers? That's really high even for the obvious options, unless you've got 10+ years direct experience or are being hired into senior manager++ management positions.
- emblem21 11y agohttp://imgur.com/iroIUTX.jpg http://imgur.com/iroIUTX.jpg
- falsestprophet 11y agoHere is some context that all of these discussions about life as a software developer in San Francisco need. There are about 243k software developers/programmers in the San Francisco-Oakland-Fremont, CA area: ~12% of the workforce. There are about 46k software developers/programmers that make over ~$145,000 in the San Francisco-Oakland-Fremont, CA area: ~2% of the workforce. These numbers seem crazy. Are developers/programmers really 12% of the workforce in the SF area? From the Bureau of Labor Statistics as of May 2014: Computer Programmers San Francisco-Oakland-Fremont, CA Total employment: 48,040 10%ile: $48,040 25%ile: $71,460 50%ile: $97,050 75&ile: $124,020 90%ile: $147,970 Software Developers, Applications San Francisco-Oakland-Fremont, CA Total employment: 70,110 10%ile: $70,110 25%ile: $87,440 50%ile: $114,700 75&ile: $144,320 90%ile: $173,130 Software Developers, Systems Software San Francisco-Oakland-Fremont, CA Total employment: 80,480 10%ile: $80,480 25%ile: $94,320 50%ile: $118,720 75&ile: $146,620 90%ile: $171,140 Web Developers San Francisco-Oakland-Fremont, CA Total employment: 45,320 10%ile: $45,320 25%ile: $64,460 50%ile: $87,540 75&ile: $119,780 90%ile: $145,130
- tomkinstinch 11y agoThanks for posting BLS numbers. For all of the comments mentioning aspirational high salaries, the BLS numbers give a much more accurate view, albeit with a minor time delay.
- irixusr 11y agoPutting aside their dubious methodology (see other comments) I'm glad to see Atlanta fared so well. I lived in ATL for almost 19 years and it's one of the most livable places I've ever been. Sad to be gone....
- vinceguidry 11y agoIn Atlanta, I actually feel like my dev salary puts me in the upper middle class. NYC, LA, or SF, I'd be just getting by. Only other city that compares, I think, is San Diego. Maybe Austin. Love this place.
- mathgeek 11y agoIt feels the same in most cities that aren't nationally known as tech hubs. Especially if you work remotely from them, but that's a whole different ballgame.
- ajeet_dhaliwal 11y agoIf they add London everyone would be at or close to 0%. Total disaster here, need to plan an exit. You must have a large inheritance to buy or not have a typical occupation, ie millionaire busines owner.
- dijit 11y agoI moved away from london, I'm lucky that I don't have family there or an emotional attachment to the city itself. I feel bad for the others, I made an above average wage and chomped over 60% of my salary in rent (+20% in bills and taxes), even if I could have afforded to buy when moving there initially, the rate of incline was so great that after 1 year I was completely unable to buy a studio apartment. Crazy. There are even anecdotes about how "my home earns more than I do". :|
- edandersen 11y agoLondon is very much overdue a correction.
- ajeet_dhaliwal 11y agoUnless it's a 50%+ drop in prices it's going to make little difference to affordability for the occupations listed on this site (fire fighters, programmers, even doctors etc). Remember even if you are some high salary like £100,000 you can only borrow 3.5 times that. That buys nothing a family can live in here. The only option is to move, inherit a fortune or become a millionaire.
- iNerdier 11y agoI grew up and still live in London and I have no possibility of ever buying anywhere to live in the city, let alone remotely near to my parents. I would say the house earning more than I do is probably more the norm than the exception at this point, save for some very large high-fliers.
- gutnor 11y agoThe situation has become extra-bad only in the last 2-3 years, but there are plenty of people that bought before 2012 across a wide variety of occupation. Especially zone 3 and up: 3 year ago a 3 bed house could be acquired for 180K GBP in ok-area zone 3 - not cheap, but not outrageously expensive for a couple - same house goes for over 400K GBP today. Nowadays, there are still a lot of part-buy/part-rent scheme being built all over zone 2. Sure you only buy 25% to 50% share, but the flat under those scheme have very conservative estimation and rock bottom rental price ( for the other 50 - 75 % ) There are even better deals for key workers ( nurses, teacher, police officer, ... ) So strangely that is easier for a couple of nurse and teacher to get on the property ladder in London than for 2 reasonably paid city workers or said differently basically if you don't qualify for government benefit you must be real rich to afford London. I agree with you, when a couple making 100K GBP would require social benefit to afford a modest 2 bed in the cheapest area your city, your housing market is fucked.
- hacknat 11y agoLet's compare median national wages to local home prices. Look at the story we can tell! Looking at median wage data can be deceiving. For example, doctors salaries are bi modal. A lot of people making 40k/year then all of a sudden they jump up to 180k. I would make the argument that software engineering is probably logarithmic from 90k, with very few people making over 140k. Is the median salary for a "programmer" 92k? Yes. Is that fact useful in the prediction of home ownership for certain local markets? I doubt it. Obviously it's hard for a median wage teacher to but a home by themselves in SF, but I question this methodology.
- jasonkostempski 11y agoFrom these numbers, it looks like it be hard for a dual income doctor/astronaut couple to own a home in SF.
- deleted 11y ago[deleted]
- stegosaurus 11y agoIn SF/London/etc? All of them. 'Occupations' don't get you a middle class lifestyle any more. You fundamentally have to play the capitalist game and maximise your income, you can't just 'do a good job' any more. Look at London. A family home in zone 6? ~400K. 20% deposit, that's 320K -> ~90K annual income required to buy it. Ninety thousand pounds. I don't think people really 'get' how much this is. It's 7x minimum wage. It's not a wage that you work hard and get, it's limited to an exclusive elite. You might be able to manage that, I might be able to manage that, but the city as a whole is knackered. I don't think people understand what it means that massive swathes of the population can never own a home, or can never save after paying for their rent. You're saying that teachers, bus drivers, shopkeepers, don't deserve anything other than to go to work over and over again. It's a total bloody disaster. I hear people moaning that tube drivers earn 50K. 50K! These guys run the god damn city, without them you couldn't get to work, and you want to pay them so little that they're unable to ever buy a studio flat. What's the solution? I will work hard and earn lots. Everyone who can't do that is knackered. That sounds like a reasonable way to run a society - winner takes all, everyone else gets shafted.
- lmm 11y agoAs a single person in London you can have a very comfortable lifestyle on 50K - I'm speaking from personal experience. Two years ago I paid 175K for a modern flat in good condition in Zone 3 - very close to a major bus depot actually, if it's the bus drivers you're worried about. I could buy what I wanted, go out more than I cared to, and was still saving money. Fundamentally there are only so many houses and a lot of people want to live in London. Maybe the young people will push the families out, and then migrate out in turn when they themselves grow up and want a big house to raise a family in. If so then that's no bad thing in my book (and I don't think it's anything new). The young people are probably getting a lot more value out of living in London, since they're the ones going to the restaurants, theatres, gigs, clubs etc. - let them.
- lzappa 11y agoYou need to check current property prices: "Last year most property sales in London involved flats which sold for on average £466,589." http://www.rightmove.co.uk/house-prices/London.html http://www.rightmove.co.uk/house-prices/London.html Yes, you can certainly find cheaper flats, but these days they're in zone 6 and far from "good condition".
- dudul 11y agoKind of funny to see that programmers can only afford 4% of houses in SF where most programmer jobs are.
- return0 11y agoI fail to understand why in this hyperconnected age real estate prices are going up. There is no need to be in a big city anyway, the prices are absurd, houses are tiny, and immigration/globalization has made most cities look alike. Or is it because the rich have thrown their money at it, inflating prices?
- zanny 11y agoIt is mostly the later - phantom "investment" in real estate, where people store wealth and own empty property rather than buy precious metals or actually invest it. But as we trend towards automation, more and more jobs are disappearing. In many areas, there is not enough density of both people and work to be able to regularly switch jobs as your current one is obsoleted or downsized. People trend towards cities if you want reliable income - jobs everywhere are going away, and the more you are paid the greater the pressure to eliminate your position. You need to be somewhere where, while the unemployment figures / workforce participation figures aren't great in cities, the density means there are more chances to get a job there than elsewhere when your current one inevitably discards you. The other thing is that mobility is a luxury. You can be rich enough to relocate - paying down payments on houses and apartments, moving or buying furniture, going through the incredible amount of state bureaucracy involving changing address and all necessary documents, and for those who are working poor you don't have the time or savings to do it. The other option is abandon everything, damn the state bureaucracy, and just jump on a bus and go somewhere you think work is plentiful, and then find out nobody will hire you without paperwork and proof of residence. It is not a solvable problem where you just tell the working poor how to succeed, because everything is systemically rigged to exploit them and keep them in the condition they are in now.
- huherto 11y agoMost people are focused on salaries. May be salaries wouldn't be such a big deal if houses weren't that expensive. - It is killing the middle class. And the lower class is hopeless. - Beyond individuals, it makes the country as a whole less competitive. (Higher costs). - It affects consumption. (Less available income) - And hardly anyone is benefiting. Since you cannot sell your house to realize gains. (You still need a place to live) Are we ready to start a conversation about a Land Tax ?
- JauntTrooper 11y agoI think urban housing demand is relatively inelastic, so I would worry that a sizable portion of a land tax would get pushed down to renters via higher rent and exacerbate the problem of high housing costs.
- tamana 11y agoThis is not economic research. This is social media marketing intern pulling numbers out of their butt and drswing pictures.