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Agreed. The notion of wealthy needs to be calibrated for local cost of living as do statistics like the CPI.

by api 7y ago

alistairSH 7y ago
Sure. But San Jose's median household income is almost double that of the US as a whole. Is its COL double than national average? I don't believe it is.
- api 7y ago
  Cost of living anywhere in the Bay Area is much higher than the national average due almost entirely to real estate.
  - alistairSH 7y ago
    As long as "much higher" is 2x the national average, Bay Area residents still come out ahead, especially on gross cash basis. Median household in SJ earns ~120k. Median for USA is ~$60k. Even if the SJ resident spend 40% on housing, they come out WAY ahead of the median household spending 25% on housing.
    - nickv 7y ago
      Housing is considerably more than 2x. Average cost of a house in America is around $380k, average cost of a house in San Francisco is $1.7M according to Zillow. San Jose is $1.2M. Fremont is $1.1M. The cheapest (and not a great place to live and horrible commute) place in the Bay Area is Vallejo and that's still $450k. So 3-6x more expensive depending on where you look generally.
- subsubzero 7y ago
  It is prb about 3 times cheaper than other areas of the country, - Gas: is still $3 a gallon here while a majority of the nation enjoys close to $1 a gal. - State taxes: run close to 10% on professional salaries, most other states have 4-5% or no state taxes. - Housing: This one is the big one, try finding a 3 bedroom house for less than $1M in the san jose/pennisula area, it just isn't possible (I am excluding parts of east san jose where housing is cheaper). A typical house in the US goes for roughly 350k. rent is no better, a 3 bdrm rental in a half decent area runs you 3.5k on up. - Property taxes: this one is tied to housing, enjoy paying 1.5% a year forever on your $1M+ house, that is 15k+ a year
  - war1025 7y ago
    > majority of the nation enjoys close to $1 a gal. This is highly regional. We are currently at somewhere around $1.75/gallon. Twenty miles away, though, has $0.99 / gallon. Doesn't make sense to me.
  - alistairSH 7y ago
    All (or most) of those are included in the COL estimates I've seen. Yes, the Bay Area is expensive. But, as best I can tell, the salaries (on average, per household) more than make up for it. Trust me, I hear the same thing in discussions about DC area salaries and COL. Relative to the rest of the nation, software developers here have a high income and high COL, but the income more than makes up for it here too.
jbay 7y ago
Yes, but that also comes with the notion that a wealthy family can become poor by moving to a higher-cost area, or a poor family can become wealthy by moving to a lower-cost area; ie, someone can sell a small house in the Bay area and buy a manor estate in the countryside. There's nothing wrong with that notion, but some will find it odd that, before that transaction happens, a family owning an upscale countryside home is wealthier than a family owning a cramped Bay area home, but after that move happens, the family that moved in from the Bay area is now the wealthier one. It means that merely having the option to sell your home and buy a countryside manor doesn't make you wealthy until you actually follow through with it.

Agreed. The notion of wealthy needs to be calibrated for local cost of living as do statistics like the CPI.

by api 7y ago

Agreed. The notion of wealthy needs to be calibrated for local cost of living as do statistics like the CPI.

Sure. But San Jose's median household income is almost double that of the US as a whole. Is its COL double than national average? I don't believe it is.

api 7y ago
Cost of living anywhere in the Bay Area is much higher than the national average due almost entirely to real estate.
- alistairSH 7y ago
  As long as "much higher" is 2x the national average, Bay Area residents still come out ahead, especially on gross cash basis. Median household in SJ earns ~120k. Median for USA is ~$60k. Even if the SJ resident spend 40% on housing, they come out WAY ahead of the median household spending 25% on housing.
  - nickv 7y ago
    Housing is considerably more than 2x. Average cost of a house in America is around $380k, average cost of a house in San Francisco is $1.7M according to Zillow. San Jose is $1.2M. Fremont is $1.1M. The cheapest (and not a great place to live and horrible commute) place in the Bay Area is Vallejo and that's still $450k. So 3-6x more expensive depending on where you look generally.
subsubzero 7y ago
It is prb about 3 times cheaper than other areas of the country, - Gas: is still $3 a gallon here while a majority of the nation enjoys close to $1 a gal. - State taxes: run close to 10% on professional salaries, most other states have 4-5% or no state taxes. - Housing: This one is the big one, try finding a 3 bedroom house for less than $1M in the san jose/pennisula area, it just isn't possible (I am excluding parts of east san jose where housing is cheaper). A typical house in the US goes for roughly 350k. rent is no better, a 3 bdrm rental in a half decent area runs you 3.5k on up. - Property taxes: this one is tied to housing, enjoy paying 1.5% a year forever on your $1M+ house, that is 15k+ a year
- war1025 7y ago
  > majority of the nation enjoys close to $1 a gal. This is highly regional. We are currently at somewhere around $1.75/gallon. Twenty miles away, though, has $0.99 / gallon. Doesn't make sense to me.
- alistairSH 7y ago
  All (or most) of those are included in the COL estimates I've seen. Yes, the Bay Area is expensive. But, as best I can tell, the salaries (on average, per household) more than make up for it. Trust me, I hear the same thing in discussions about DC area salaries and COL. Relative to the rest of the nation, software developers here have a high income and high COL, but the income more than makes up for it here too.

jbay 7y ago

Yes, but that also comes with the notion that a wealthy family can become poor by moving to a higher-cost area, or a poor family can become wealthy by moving to a lower-cost area; ie, someone can sell a small house in the Bay area and buy a manor estate in the countryside. There's nothing wrong with that notion, but some will find it odd that, before that transaction happens, a family owning an upscale countryside home is wealthier than a family owning a cramped Bay area home, but after that move happens, the family that moved in from the Bay area is now the wealthier one. It means that merely having the option to sell your home and buy a countryside manor doesn't make you wealthy until you actually follow through with it.