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Yes, this is absolutely true. Your car, clothing, computers and gadgets, and most of your groceries will be a lower percentage of your discretionary income in t

Yes, this is absolutely true. Your car, clothing, computers and gadgets, and most of your groceries will be a lower percentage of your discretionary income in the Bay Area than in most other places. Your housing and gasoline will cost more, and maybe your car insurance. However, the caveat is that housing is so expensive here that it's difficult to save up for a down payment on any kind of housing on a single engineer's salary. A 20% down payment on pretty much anything is more than $100k, and even a highly paid engineer will need a long time to save up that kind of money while also paying high rent. An 80/10/10 mortgage or some kind of mortgage with PMI is easier to achieve, but those have significant drawbacks. So, if you have significant cash savings, or a home somewhere else you can sell, you can achieve home ownership in the Bay Area (but it will probably be a smaller home than the one you have now). If you don't aspire to home ownership, you'll be fine too -- a software engineer with an average salary can afford to pay rent here, and people who say otherwise are simply incorrect. But if you are just starting your career and move to the Bay Area planning to buy a home anytime soon, you're going to be disappointed. Given that many people predicate their quality of life on home ownership, that's a pretty big caveat.

nostrademons 10y ago
It takes about 2 years to save up $100K on a typical Bay Area engineer's salary, if you're fiscally prudent. Figure that $150K/year after taxes is about $110K/year, and live on $60K/year. That's eminently doable even in the Bay Area. The problem is that $100K is a very low estimate for a down payment in the Bay Area these days. Most people I know are getting parental help to put down $500K down, because with housing prices running around $1.2M, that's what's necessary to get under the $700K jumbo mortgage threshold.
- st3v3r 10y ago
  >It takes about 2 years to save up $100K on a typical Bay Area engineer's salary, if you're fiscally prudent. Read: Don't have a family and don't do anything special, like take vacations. Also, average rent is $3600/month. That's over $43k a year. That leaves $17k for everything else, following your plan.
  - OmarIsmail 10y ago
    A single person does NOT need to spend 3600/month in SF. That's crazy. A studio/1 bedroom can be had for 2500. And if you're willing to compromise on location (i.e. "the ghetto") you can get under 2K. Families that need 2+ bedrooms and a good/safe neighbourhood are screwed though.
    - twblalock 10y ago
      You don't have to live in San Francisco. There are plenty of nearby cities with cheaper rent.
      - sbov 10y ago
        Yeah, a lot of times people seem to talk past eachother because to them, SF = bay area. In reality it's a small portion of the population and even smaller portion of the land mass of the actual bay area.
      - logfromblammo 10y ago
        ...like Sacramento.~
        twblalock 10y ago
        Even San Mateo, which is not very far away, costs a lot less. And if you work in SF and commute from the East Bay via BART, which isn't too bad, you can save even more.
      - jaf656s 10y ago
        Not sure why this was downvoted.. I live in Berkeley and a 2bdr here is cheaper than a studio in the city.
      - st3v3r 10y ago
        But then you'll have to likely sacrifice several hours of your day just to commuting.
- twblalock 10y ago
  > It takes about 2 years to save up $100K on a typical Bay Area engineer's salary, if you're fiscally prudent. I'm not sure what you think an average salary is. If you think an average engineer can save $50k cash per year out of his/her net income, you're way above the average I had in mind. Let's assume an average salary of $120k per year gross. That's about $6k per month net for a single person who takes the standard deduction, assuming no 401k contributions. That's a net income of $72k per year. If that engineer saves $50k, that leaves only $12k for everything else. Saving $100k in two years on that salary, which I think is pretty close to the average, is just not doable. EDIT: Should have been $22k left over, not $12k. Still not enough to live on considering the cost of rent.
  - nostrademons 10y ago
    The article showed a BLS median salary of about $150K/year for San Jose, and TripleByte's data had it at about $140K/year for SF.
  - the_gastropod 10y ago
    > assuming no 401k contributions. Why? Fully contributing to a 401k (assuming no company match) would put your "take home" at ~$79,200 instead of $72k following your tax rate (which I assume is roughly correct). > That's a net income of $72k per year. If that engineer saves $50k, that leaves only $12k for everything else $72k - $50k = $22k, not $12k. So with no 401k, you'd have to live on $22k to save $50k/year. When contributing to a 401k, you'd have $29k to live on, which sounds pretty do-able. Add in the fact that you would probably invest these savings, and you can hit $100k after 2 years by saving a bit under $50k each year. Saving $100k in 2 years is not as outlandish as you make it seem.
    - jdmichal 10y ago
      How exactly do you figure increasing your take-home pay by contributing to a 401k? Did you forget to subtract the money that's actually going to the 401k instead of your pocket? Even at 90% tax rate, all you are doing is sparing that 90% on the money you are contributing. In other words, you are only actually paying $10 for every $100 you put in, because that other $90 would have gone to the tax man anyway. But you are still losing $10 of your take-home pay.
- bradlys 10y ago
  Sorry, I live here. I have an average salary for my experience. I can barely save $20k/yr. My rent+util is about $2000/month. I live in a very /cheap/ 1-bedroom with creaky carpet floors, no insulation, and near train tracks that's far outside SF. (Belmont) Altogether I spend close to $4000/month if I don't do anything special. /Everything/ is more expensive in this region. Food is expensive for no apparent reason other than to gouge customers. ($6 for a few sticks of butter? When I was in Seattle, it was $2-3.) I eat less fruits here because the prices are high year round. My job doesn't provide lunches, so I have to eat out everyday I'm at work. I mean, even cars cost more here just on Craigslist. In the same way there's an Apple tax, there's definitely a Bay Area tax. I cannot possibly save $50k/yr for a house. Oh and $150k/yr is not $110k/yr after taxes. It's more like $94k. I'm saving maybe $20k/yr right now. Ain't even contributing to retirement. Just trying to save for who knows what until I can get a job that pays 50% more.
  - bcheung 10y ago
    It's cheaper to live in a larger place with roommates. You pay a premium for single bedroom and living by yourself. I lived in a warehouse with 5 other people for a while to save money.
    - paganel 10y ago
      From a certain point in life living at your own place (no matter if rented or not) with no room-mates is non-negotiable, given the financial means to do so. I'd rather live in a studio apartment at the edge of the city (been there, done that) rather than sharing a villa in a beautiful neighborhood with 5 other strangers. If it matters I'm in my mid-30s now, but started feeling that way immediately after I broke up with my wife 5 years ago.
  - rconti 10y ago
    Huh. We just moved out of a 2/1 in Belmont, 1 block off El Camino next to the Safeway, where we were paying $2050. Sure, once you add utils in it's more, but not a lot more. Splitting the rent with my wife, my share was basically what I was paying in rent for a 'fancy' apartment I shared with a roommate in Santa Clara 10 years ago. Granted, the house was a good deal, but should be able to swing a 2/1 for 2500 or so.
- rconti 10y ago
  Your comment doesn't really make any sense, because there is no benefit to having a conforming loan. In fact, there are drawbacks. Recent data showed that jumbo loan rates were LOWER than the equivalent conforming loan. We bought with 10% down on a jumbo and because it's not federally-backed you don't have to pay PMI. Mortgage, taxes, insurance, that's it. Also, I don't know anybody who got that kind of parental help or put $500k down.
  - nostrademons 10y ago
    That was the reasoning given by a coworker who did this, and he put $500K down. I personally know at least 3 people who've bought Bay Area houses/condos in the $1.1-$1.2M range with multi-hundred-K parental help.
    - rconti 10y ago
      November 2013: http://money.cnn.com/2013/11/12/real_estate/jumbo-mortgages/ http://money.cnn.com/2013/11/12/real_estate/jumbo-mortgages/ September 2016: http://www.bankrate.com/financing/mortgages/jumbo-home-rates-dip-below-30-year-fixed/ http://www.bankrate.com/financing/mortgages/jumbo-home-rates... From TFA "the jumbo loan is supposed to come with a slightly higher rate". IMO the rate should be a LOT higher; otherwise PMI is always a losing proposition. Bizarre market forces indeed. It was certainly surprising/counterintuitive that jumbo rates would be lower than conforming, but even when they're not, it sounds like they're incredibly close. That said, if someone wanted to throw $500k at me to buy a house, I wouldn't turn it down :)
- anigbrowl 10y ago
  Even with generous wages house prices are rising faster than salaries. And let's be frank about this, when well-paid sw engineers are feeling the squeeze, imagine how awful the economic situation is for anyone in a less fashionable job. There are lots of people who work just as hard as any coder and whose jobs are just as necessary to a livable economy but who face certain economic ruin if they lose their lease - hence all the pressure for a $15 minimum wage. Meanwhile a lot of people who already own property fight tooth and nail against any large-scale building. It's a vicious circle.
- caseysoftware 10y ago
  I agree with your premise but I suspect your numbers are a bit off. Regardless, whether it's 2 years or 3 years, to do the lifestyle you're suggesting takes and incredible amount of willpower to be willing to sacrifice and prioritize. It's passing up that cell phone upgrade. It's cutting discretionary spending to zero. It's passing on happy hour and bringing lunch every day. While feasible, it's hard.. but suffering for two years to benefit for a decade. Quite possibly worth it.
  - Rapzid 10y ago
    It's worth pointing out that is just for the down payment. If you want to get ahead in life you need to be "saving" that much and more every year. And oops, your expenses just shot up dramatically because now you're a home owner.
    - smsm42 10y ago
      BTW everybody knows about mortgage payments/rent but many forget about property taxes you have to pay as a homeowner. That's about 1.5% of your house purchase cost every year. Of course, there are tax deductions for that but even after them it's still non-negligible chunk of cash on homes approaching $1M.
      - shostack 10y ago
        Don't forget about home repairs and renovations, HOA, and services like gardening, etc. depending on what you buy. It is easy to end up spending double rent on a comparable place. The difference is for now at least the home you buy can grow nicely so you need to do the math on rate of return for that vs other uses of that cash.
        vonmoltke 10y ago
        Those are all expenses your landlord has to pay if you are renting. If those costs plus mortgage is double rent than either landlords are hemmoraging money or something is seriously fucked up with the housing market.
- mr_pink 10y ago
  > It takes about 2 years to save up $100K on a typical Bay Area engineer's salary Have you actually done this? Know anyone who has? This seems completely implausible, outside of some extreme frugal lifestyle cases (I'm talking "eating garbage dumped by grocery stores" level frugal)...
  - nostrademons 10y ago
    I actually saved up $100K in about 18 months, working at a large Bay Area tech company and living in Mountain View. I don't feel I made significant compromises to do so, either: I had roommates for 6 of those 18 months but lived in a 1BR afterwards, I had friends (many of whom I still keep up with), I owned a car and got out on weekends. I did cook the majority of my (non-employer-provided) meals at home, and my friends tended to like relatively cheap activities like LAN parties, board games, and hiking rather than expensive meals out. I didn't go on any major vacations, but my family lives back East, and so that includes rather expensive airfare at Christmas, Thanksgiving, and 4th of July to see them.
    - mr_pink 10y ago
      Paycheck calculator shows me that $120K [1] in CA leaves you with $6,220 after-tax monthly income. If you really made about as much, and managed to save ~$5.5K a month, then you spent only ~$660 a month, which is just impossible, sorry. Even if you're sharing a 1BR with several roommates, which, by the way, is not really an option for many. [1] Googling "average software engineer salary california" shows figures ranging from 107k to 135k, 120k seems to be more or less the median of Google's figures. Edit: added footnote
      - nostrademons 10y ago
        It was 2009-2010, so rents were lower, but my paycheck was lower as well (I started at only $100K/year base, compared to the ... well, much higher amount a few years later). After taxes and 401k, I netted $5400/month. 18 months encompassed 2 bonus cycles, so about $40K of that was bonuses, after tax. My rent was $900/month with roommates, and then $1400/month in the 1BR, and total monthly expenditures were about $2K. I was packing away about $3.5K/month; 18 months of that is $63K, +$40K from bonuses = just over $100K.
- astrange 10y ago
  When you say a typical engineer's salary, I feel like you mean a high performer at Google with a rich family. I make about that much, at a company without free food perks that doesn't give me amazing stock bonuses (my social skills are too bad to negotiate them…) and I live frugally but could never save that much after $2k/mo rent! And there's no huge parental loans for me.
- ryandrake 10y ago
  You would have to be extremely well paid and frugal to save $100K in two years. Sure, it's do-able, but wow. Of course, this is HN, so there's always someone who knows someone's brother's roommate who makes $150K/year at Google but that's a pretty high salary. And to be able to keep $50K of that given the cost of everything? I don't see how it's possible unless you are single, have no kids, no existing debt payments, don't put anything away into IRAs, 401ks, etc. and are are extremely frugal. But if you do and are, you have $100K. Congratulations. That does you no good when homes are $1M+. Keep saving.
  - pedrosorio 10y ago
    "there's always someone who knows someone's brother's roommate who makes $150K/year at Google" I don't know any software engineer at Google (in the Bay Area) with such a low annual compensation: https://www.paysa.com/salaries/google--software-engineer--mountain-view,-ca https://www.paysa.com/salaries/google--software-engineer--mo...
gnopgnip 10y ago
You should not buy a home unless you are going to live in the same place for 10+ years. Especially if you get a rent controlled apartment, owning a home does not make financial sense in the bay area. The other big thing to help with home ownership is to get married. With double the income it is a lot easier to save for a downpayment.
findjashua 10y ago
If you're a HENRY (High Earner, Not Rich Yet), and have a good credit score (>740), you might qualify for a mortgage with 10% down payment without PMI/second mortgage. With a frugal lifestyle, 10% should be doable in a couple years, especially if you're okay with living in the East Bay (so the house price is somewhat reasonable).
- Rapzid 10y ago
  I'm certainly not agreeing with the value prop of the Bay Area, but PMI is actually not such a bad deal if you have prospects. It's not very much extra a month, and now you can get it removed after you have 20% equity in your home by request.
morgante 10y ago
Or you just save up to buy a home elsewhere.
- flukus 10y ago
  Isn't the rent just as high?
  - morgante 10y ago
    No. The housing market in SV makes renting cheaper than buying. On an engineer's salary, it is very doable to pay rent and still save up enough to buy an entire house in cash elsewhere in the country.
emodendroket 10y ago
I mean you only have to pay PMI till you have 20% equity, so it's not necessarily so bad.

nostrademons 10y ago

It takes about 2 years to save up $100K on a typical Bay Area engineer's salary, if you're fiscally prudent. Figure that $150K/year after taxes is about $110K/year, and live on $60K/year. That's eminently doable even in the Bay Area. The problem is that $100K is a very low estimate for a down payment in the Bay Area these days. Most people I know are getting parental help to put down $500K down, because with housing prices running around $1.2M, that's what's necessary to get under the $700K jumbo mortgage threshold.

st3v3r 10y ago
>It takes about 2 years to save up $100K on a typical Bay Area engineer's salary, if you're fiscally prudent. Read: Don't have a family and don't do anything special, like take vacations. Also, average rent is $3600/month. That's over $43k a year. That leaves $17k for everything else, following your plan.
- OmarIsmail 10y ago
  A single person does NOT need to spend 3600/month in SF. That's crazy. A studio/1 bedroom can be had for 2500. And if you're willing to compromise on location (i.e. "the ghetto") you can get under 2K. Families that need 2+ bedrooms and a good/safe neighbourhood are screwed though.
  - twblalock 10y ago
    You don't have to live in San Francisco. There are plenty of nearby cities with cheaper rent.
    - sbov 10y ago
      Yeah, a lot of times people seem to talk past eachother because to them, SF = bay area. In reality it's a small portion of the population and even smaller portion of the land mass of the actual bay area.
    - logfromblammo 10y ago
      ...like Sacramento.~
      - twblalock 10y ago
        Even San Mateo, which is not very far away, costs a lot less. And if you work in SF and commute from the East Bay via BART, which isn't too bad, you can save even more.
    - jaf656s 10y ago
      Not sure why this was downvoted.. I live in Berkeley and a 2bdr here is cheaper than a studio in the city.
    - st3v3r 10y ago
      But then you'll have to likely sacrifice several hours of your day just to commuting.
twblalock 10y ago
> It takes about 2 years to save up $100K on a typical Bay Area engineer's salary, if you're fiscally prudent. I'm not sure what you think an average salary is. If you think an average engineer can save $50k cash per year out of his/her net income, you're way above the average I had in mind. Let's assume an average salary of $120k per year gross. That's about $6k per month net for a single person who takes the standard deduction, assuming no 401k contributions. That's a net income of $72k per year. If that engineer saves $50k, that leaves only $12k for everything else. Saving $100k in two years on that salary, which I think is pretty close to the average, is just not doable. EDIT: Should have been $22k left over, not $12k. Still not enough to live on considering the cost of rent.
- nostrademons 10y ago
  The article showed a BLS median salary of about $150K/year for San Jose, and TripleByte's data had it at about $140K/year for SF.
- the_gastropod 10y ago
  > assuming no 401k contributions. Why? Fully contributing to a 401k (assuming no company match) would put your "take home" at ~$79,200 instead of $72k following your tax rate (which I assume is roughly correct). > That's a net income of $72k per year. If that engineer saves $50k, that leaves only $12k for everything else $72k - $50k = $22k, not $12k. So with no 401k, you'd have to live on $22k to save $50k/year. When contributing to a 401k, you'd have $29k to live on, which sounds pretty do-able. Add in the fact that you would probably invest these savings, and you can hit $100k after 2 years by saving a bit under $50k each year. Saving $100k in 2 years is not as outlandish as you make it seem.
  - jdmichal 10y ago
    How exactly do you figure increasing your take-home pay by contributing to a 401k? Did you forget to subtract the money that's actually going to the 401k instead of your pocket? Even at 90% tax rate, all you are doing is sparing that 90% on the money you are contributing. In other words, you are only actually paying $10 for every $100 you put in, because that other $90 would have gone to the tax man anyway. But you are still losing $10 of your take-home pay.
bradlys 10y ago
Sorry, I live here. I have an average salary for my experience. I can barely save $20k/yr. My rent+util is about $2000/month. I live in a very /cheap/ 1-bedroom with creaky carpet floors, no insulation, and near train tracks that's far outside SF. (Belmont) Altogether I spend close to $4000/month if I don't do anything special. /Everything/ is more expensive in this region. Food is expensive for no apparent reason other than to gouge customers. ($6 for a few sticks of butter? When I was in Seattle, it was $2-3.) I eat less fruits here because the prices are high year round. My job doesn't provide lunches, so I have to eat out everyday I'm at work. I mean, even cars cost more here just on Craigslist. In the same way there's an Apple tax, there's definitely a Bay Area tax. I cannot possibly save $50k/yr for a house. Oh and $150k/yr is not $110k/yr after taxes. It's more like $94k. I'm saving maybe $20k/yr right now. Ain't even contributing to retirement. Just trying to save for who knows what until I can get a job that pays 50% more.
- bcheung 10y ago
  It's cheaper to live in a larger place with roommates. You pay a premium for single bedroom and living by yourself. I lived in a warehouse with 5 other people for a while to save money.
  - paganel 10y ago
    From a certain point in life living at your own place (no matter if rented or not) with no room-mates is non-negotiable, given the financial means to do so. I'd rather live in a studio apartment at the edge of the city (been there, done that) rather than sharing a villa in a beautiful neighborhood with 5 other strangers. If it matters I'm in my mid-30s now, but started feeling that way immediately after I broke up with my wife 5 years ago.
- rconti 10y ago
  Huh. We just moved out of a 2/1 in Belmont, 1 block off El Camino next to the Safeway, where we were paying $2050. Sure, once you add utils in it's more, but not a lot more. Splitting the rent with my wife, my share was basically what I was paying in rent for a 'fancy' apartment I shared with a roommate in Santa Clara 10 years ago. Granted, the house was a good deal, but should be able to swing a 2/1 for 2500 or so.
rconti 10y ago
Your comment doesn't really make any sense, because there is no benefit to having a conforming loan. In fact, there are drawbacks. Recent data showed that jumbo loan rates were LOWER than the equivalent conforming loan. We bought with 10% down on a jumbo and because it's not federally-backed you don't have to pay PMI. Mortgage, taxes, insurance, that's it. Also, I don't know anybody who got that kind of parental help or put $500k down.
- nostrademons 10y ago
  That was the reasoning given by a coworker who did this, and he put $500K down. I personally know at least 3 people who've bought Bay Area houses/condos in the $1.1-$1.2M range with multi-hundred-K parental help.
  - rconti 10y ago
    November 2013: http://money.cnn.com/2013/11/12/real_estate/jumbo-mortgages/ http://money.cnn.com/2013/11/12/real_estate/jumbo-mortgages/ September 2016: http://www.bankrate.com/financing/mortgages/jumbo-home-rates-dip-below-30-year-fixed/ http://www.bankrate.com/financing/mortgages/jumbo-home-rates... From TFA "the jumbo loan is supposed to come with a slightly higher rate". IMO the rate should be a LOT higher; otherwise PMI is always a losing proposition. Bizarre market forces indeed. It was certainly surprising/counterintuitive that jumbo rates would be lower than conforming, but even when they're not, it sounds like they're incredibly close. That said, if someone wanted to throw $500k at me to buy a house, I wouldn't turn it down :)
anigbrowl 10y ago
Even with generous wages house prices are rising faster than salaries. And let's be frank about this, when well-paid sw engineers are feeling the squeeze, imagine how awful the economic situation is for anyone in a less fashionable job. There are lots of people who work just as hard as any coder and whose jobs are just as necessary to a livable economy but who face certain economic ruin if they lose their lease - hence all the pressure for a $15 minimum wage. Meanwhile a lot of people who already own property fight tooth and nail against any large-scale building. It's a vicious circle.
caseysoftware 10y ago
I agree with your premise but I suspect your numbers are a bit off. Regardless, whether it's 2 years or 3 years, to do the lifestyle you're suggesting takes and incredible amount of willpower to be willing to sacrifice and prioritize. It's passing up that cell phone upgrade. It's cutting discretionary spending to zero. It's passing on happy hour and bringing lunch every day. While feasible, it's hard.. but suffering for two years to benefit for a decade. Quite possibly worth it.
- Rapzid 10y ago
  It's worth pointing out that is just for the down payment. If you want to get ahead in life you need to be "saving" that much and more every year. And oops, your expenses just shot up dramatically because now you're a home owner.
  - smsm42 10y ago
    BTW everybody knows about mortgage payments/rent but many forget about property taxes you have to pay as a homeowner. That's about 1.5% of your house purchase cost every year. Of course, there are tax deductions for that but even after them it's still non-negligible chunk of cash on homes approaching $1M.
    - shostack 10y ago
      Don't forget about home repairs and renovations, HOA, and services like gardening, etc. depending on what you buy. It is easy to end up spending double rent on a comparable place. The difference is for now at least the home you buy can grow nicely so you need to do the math on rate of return for that vs other uses of that cash.
      - vonmoltke 10y ago
        Those are all expenses your landlord has to pay if you are renting. If those costs plus mortgage is double rent than either landlords are hemmoraging money or something is seriously fucked up with the housing market.
mr_pink 10y ago
> It takes about 2 years to save up $100K on a typical Bay Area engineer's salary Have you actually done this? Know anyone who has? This seems completely implausible, outside of some extreme frugal lifestyle cases (I'm talking "eating garbage dumped by grocery stores" level frugal)...
- nostrademons 10y ago
  I actually saved up $100K in about 18 months, working at a large Bay Area tech company and living in Mountain View. I don't feel I made significant compromises to do so, either: I had roommates for 6 of those 18 months but lived in a 1BR afterwards, I had friends (many of whom I still keep up with), I owned a car and got out on weekends. I did cook the majority of my (non-employer-provided) meals at home, and my friends tended to like relatively cheap activities like LAN parties, board games, and hiking rather than expensive meals out. I didn't go on any major vacations, but my family lives back East, and so that includes rather expensive airfare at Christmas, Thanksgiving, and 4th of July to see them.
  - mr_pink 10y ago
    Paycheck calculator shows me that $120K [1] in CA leaves you with $6,220 after-tax monthly income. If you really made about as much, and managed to save ~$5.5K a month, then you spent only ~$660 a month, which is just impossible, sorry. Even if you're sharing a 1BR with several roommates, which, by the way, is not really an option for many. [1] Googling "average software engineer salary california" shows figures ranging from 107k to 135k, 120k seems to be more or less the median of Google's figures. Edit: added footnote
    - nostrademons 10y ago
      It was 2009-2010, so rents were lower, but my paycheck was lower as well (I started at only $100K/year base, compared to the ... well, much higher amount a few years later). After taxes and 401k, I netted $5400/month. 18 months encompassed 2 bonus cycles, so about $40K of that was bonuses, after tax. My rent was $900/month with roommates, and then $1400/month in the 1BR, and total monthly expenditures were about $2K. I was packing away about $3.5K/month; 18 months of that is $63K, +$40K from bonuses = just over $100K.
astrange 10y ago
When you say a typical engineer's salary, I feel like you mean a high performer at Google with a rich family. I make about that much, at a company without free food perks that doesn't give me amazing stock bonuses (my social skills are too bad to negotiate them…) and I live frugally but could never save that much after $2k/mo rent! And there's no huge parental loans for me.
ryandrake 10y ago
You would have to be extremely well paid and frugal to save $100K in two years. Sure, it's do-able, but wow. Of course, this is HN, so there's always someone who knows someone's brother's roommate who makes $150K/year at Google but that's a pretty high salary. And to be able to keep $50K of that given the cost of everything? I don't see how it's possible unless you are single, have no kids, no existing debt payments, don't put anything away into IRAs, 401ks, etc. and are are extremely frugal. But if you do and are, you have $100K. Congratulations. That does you no good when homes are $1M+. Keep saving.
- pedrosorio 10y ago
  "there's always someone who knows someone's brother's roommate who makes $150K/year at Google" I don't know any software engineer at Google (in the Bay Area) with such a low annual compensation: https://www.paysa.com/salaries/google--software-engineer--mountain-view,-ca https://www.paysa.com/salaries/google--software-engineer--mo...

gnopgnip 10y ago

You should not buy a home unless you are going to live in the same place for 10+ years. Especially if you get a rent controlled apartment, owning a home does not make financial sense in the bay area. The other big thing to help with home ownership is to get married. With double the income it is a lot easier to save for a downpayment.

findjashua 10y ago

If you're a HENRY (High Earner, Not Rich Yet), and have a good credit score (>740), you might qualify for a mortgage with 10% down payment without PMI/second mortgage. With a frugal lifestyle, 10% should be doable in a couple years, especially if you're okay with living in the East Bay (so the house price is somewhat reasonable).

Rapzid 10y ago
I'm certainly not agreeing with the value prop of the Bay Area, but PMI is actually not such a bad deal if you have prospects. It's not very much extra a month, and now you can get it removed after you have 20% equity in your home by request.

morgante 10y ago

Or you just save up to buy a home elsewhere.

flukus 10y ago
Isn't the rent just as high?
- morgante 10y ago
  No. The housing market in SV makes renting cheaper than buying. On an engineer's salary, it is very doable to pay rent and still save up enough to buy an entire house in cash elsewhere in the country.

emodendroket 10y ago

I mean you only have to pay PMI till you have 20% equity, so it's not necessarily so bad.