4 ms·

Bay Area has a housing affordability issue for people who are in non-tech sectors. For those in the tech sector, there is no affordability issue, only entitlem

by tnt128 10y ago

Bay Area has a housing affordability issue for people who are in non-tech sectors. For those in the tech sector, there is no affordability issue, only entitlement issue If they are married, both in tech, their salary will be in the 300k-400k range, that's about 25k - 33k/month before tax, or about 15 - 20k/month after tax. with today's interest rate, $1MM house will need a monthly payment $4k - $5k/month including property tax. The couple will still have about 10k/month left after paying the mortgage. Assuming they are renting and are fiscally responsible, they should be able to save about 70 - 100k on 300 - 400k income/year. which means they will just need 2 years before they can save up for the down payment. So where is the issue? The issue is they jumped their league - Sunnyvale, Palo Alto, Mountain View, SF are the 'major leagues' - foreign cash buyers, tech execs or, more commonly , average Joe who sold their first house with $500k+ gain in tax free equity - (not hard to do in the bay area btw). First time home buyer will have a tough time competing in this league. Try the minor league instead, try east bay, dublin($900k), livermore still in the $700k - both good schools but 60min+ away, or how about places like Newark or Union City, still in the $700k, both within 30 mins drive (but so so schools). If they are struggling to buy a $2MM home because they have to buy in these neighborhoods. it's an entitlement problem, not an affordability issue.

aaronblohowiak 10y ago
Or they buy smaller and have a condo and kids share a room
- obstinate 10y ago
  Absolutely! I definitely feel for the plight of those making <$80k or so here. But if you make more than that, I can't bring myself to have too much sympathy. You can afford a 2br apartment, to max your 401k, to feed and clothe yourself, and to take a few decent vacations a year, which is more than most Americans get. Separate bedrooms are not a human right, especially for children. Hell, my brothers and I slept in the same room for a long time even after our parents were able to afford a house with extra rooms. You wanna see someone taking it to a beautiful extreme, check out http://5kids1condo.com/ http://5kids1condo.com/
  - wapz 10y ago
    I don't think 90k/year in the bay area is nearly enough for even a couple (and you mention children?!). A 2br apartment will go for $2500/month with a long commute. I presume you're talking pre-tax 80k.
    - obstinate 10y ago
      2br in Sunnyvale can be had for that much with some looking. A buddy of mine is renting a decently nice detached house with 3br for 3000/mo. So the apartment costs 30k a year. Taxes will be quite low if a 401k are being maxed -- maybe 15k in total taxes? So we have roughly 80k - 15k - 25k = 30k to cover everything other than housing. This is very doable. It is not a lavish lifestyle but it's more than most Americans get to cover the same slice of expenses.
edblarney 10y ago
"married, both in tech, their salary will be in the 300k-400k" No, it's rare to have both couples in tech AND making 150K plus each. Avg Engineer salary is not even quite that high at Google. A 150K job is still a 'pretty good job' and a little more rare than you'd imagine. Also, there's a lot of moving around, and that means a few months every few years of not working.

by tnt128 10y ago

aaronblohowiak 10y ago

Or they buy smaller and have a condo and kids share a room

obstinate 10y ago
Absolutely! I definitely feel for the plight of those making <$80k or so here. But if you make more than that, I can't bring myself to have too much sympathy. You can afford a 2br apartment, to max your 401k, to feed and clothe yourself, and to take a few decent vacations a year, which is more than most Americans get. Separate bedrooms are not a human right, especially for children. Hell, my brothers and I slept in the same room for a long time even after our parents were able to afford a house with extra rooms. You wanna see someone taking it to a beautiful extreme, check out http://5kids1condo.com/ http://5kids1condo.com/
- wapz 10y ago
  I don't think 90k/year in the bay area is nearly enough for even a couple (and you mention children?!). A 2br apartment will go for $2500/month with a long commute. I presume you're talking pre-tax 80k.
  - obstinate 10y ago
    2br in Sunnyvale can be had for that much with some looking. A buddy of mine is renting a decently nice detached house with 3br for 3000/mo. So the apartment costs 30k a year. Taxes will be quite low if a 401k are being maxed -- maybe 15k in total taxes? So we have roughly 80k - 15k - 25k = 30k to cover everything other than housing. This is very doable. It is not a lavish lifestyle but it's more than most Americans get to cover the same slice of expenses.

edblarney 10y ago

"married, both in tech, their salary will be in the 300k-400k" No, it's rare to have both couples in tech AND making 150K plus each. Avg Engineer salary is not even quite that high at Google. A 150K job is still a 'pretty good job' and a little more rare than you'd imagine. Also, there's a lot of moving around, and that means a few months every few years of not working.