4 ms·
This is an interesting article that describes building a $2-6 million dollar house in a matter-of-fact manner. I wonder what the prospective audience size for t
by linkregister 9y ago
This is an interesting article that describes building a $2-6 million dollar house in a matter-of-fact manner. I wonder what the prospective audience size for this article is in the Bay Area –maybe less than 5000 local people are capable of affording these properties.
- scarmig 9y agoThat's a wild underestimate. I'd guess at least 100k people can afford properties like that, unless you mean something like afford it in cash. Even then, it's still an underestimate.
- chrissnell 9y agoSo, a $3MM home costs approximately $30K a month after interest, depreciation, taxes, and insurance, right? That's around $360,000 a year. Assuming you're going way overboard and spending half of your income on housing, that's $720K/yr of salary required to support that--or more, if you want to save a little money and have a life outside of work and writing mortgage checks. How many households are pulling this kind of cash down? Is that a common salary at a big tech company? Maybe for CxOs but not for run of the mill Director-level middle management.
- nitrogen 9y agoHow do you arrive at this $30k/mo figure?
- scarmig 9y agoIt might be slightly high, but it sounds about right extrapolating from my situation.
- chrissnell 9y agoCommonly accepted figure for total cost of a house is 1% a month.
- Domenic_S 9y agoThe 1% rule is for pricing rentals. Actual cost (PITI) in California is something like 0.5-0.75%.
- scarmig 9y agoThe Bay Area has around 3 million households. The top 1% of households in this area make around 720k or so. So that by itself gets you to 30k households. Account for the fact that 2 million is much more attainable than 3, and based on income alone you get pretty close to 100k households. Many people also store their assets in real estate. Add those in (people selling their old house to buy a new one), and you are definitely above 100k households able to afford a 2 million dollar place.
- scarmig 9y agoAlso, as far as what a typical household making near that much might look like: my personal situation is that I'm a senior software engineer, whose total comp is nothing really exceptional. I'm married to a nurse. Our household income is around 500k. You can easily imagine ways to tweak our careers to put us into the 1% range. Even as is, we have an attainable 5 year plan to buy a home at the lower end of the listed range without being stupid.
- deleted 9y ago[deleted]
- ikeyany 9y agoDon't underestimate the number of people out there who are far wealthier than us 9-5 coders—people come from all over the world to buy property on the west coast.
- ProAm 9y agoHonestly I think 'those' people dont read hacker news or need a guide on how to do this. It was an interesting post but not for anyone that has built or bought property (anywhere) before.
- seanp2k2 9y agohttps://macropolo.org/chinese-real-estate-money-transforming-san-francisco-bay-area/ https://macropolo.org/chinese-real-estate-money-transforming... there's a lot of foreign investment and money parking happening in the Bay Area as well.