Moses2013

I always knew that the Bay area is expensive, but how do people really manage to live there these days and why? Of course there are many high paying tech jobs, but if you are so highly qualified and work long hours, don't you want to live in luxury, or have more spending money than a person on minimum wage? Even with a great salary, to afford a wood shack like this in an earthquake zone, you need $849K and then property taxes are $470 each month. Even with a decent San Francisco salary, how much money do people really have at the end of the month?20 Prague Street, San Francisco, CA For Sale | Trulia.com

scrubbedexpat099

Cheap compared to London.

mikelincs

might be lucky and get a two bed place in London for that.

scrubbedexpat099

I have a 2 bed flat and it is a lot more than that.

FlyingDutchman6666

Here's an honest attempt at answering your question. Tech companies and workers don't exist in a vacuum, they need cooperation and symbiosis to be successful. They concentrate themselves in "hubs" to generate innovation, pool investment and (ultimately) make money. This is a big contrast with tradies and medical professionals for example. More brickies or veterinarians moving into a city means lower wages. More tech workers moving in usually means higher wages. That's one reason why you will not find doctor or brickie hubs

As the concentration of tech workers in a hub increases, so do wages. As wages increase, so does the flow of tech workers into the hub, attracted by the high wages. But as more and more techies move in, they start competing with each other for resources - houses for example. House prices increase, and eventually high house prices start cancelling out the high wages. Which in turn stops the inflow of techies.

The anoraks would say that equilibrium is reached at this point.

The winners are:
- the super-rich who control the tech companies
- the people who lived in the city before it was a hub and own houses or investment properties

And the losers are:
- an average joe living in a tech hub
- you (a non-tech worker who checks out what it's like to live in the Bay Area, and recoils in horror)
- the techies themselves?

Nutmegger

I might be persuaded to commit violence for property taxes under $6,000 per annum.

roberth1970

Live out in the East Bay, have two incomes of $150k+ each? I would estimate you need a family income of $200-250k to support a family. We managed OK on one decent salary - but without a lot of saving ability.

dc koop

Seems that a lot of people live in apartments which were illegally converted from house garages

Pulaski

It is likely the biggest impact is on people moving to San Francisco. If you already live there as a property owner then the worst thing that could likely happen is that you're stuck in the house/apartment that you currently live in. It will also limit how far you can move "up the property ladder". But I can't imagine how many times my current salary I would need to take a job in San Francisco.

McBadger

"Why" is the reason, weather and jobs. Great jobs and work if you are good and in hi-tech.

You are right about the cost though. The prices in 2007/2008 seem like a dream now. I'm not sure rent control and prop 13 are helping either.

Of course there are still really cheap pockets to live in, if you like violent crime. I know of people who moved to East Palo Alto / Menlo thinking that gentrification due to Facebook would happen. They've had to put up with several burglaries though, and not being safe on the streets around where they live.

The folks on CNBC were predicting a great year on the stock market for 2016, I guess that must mean we are due another "correction".

dc koop

Market Street is a mess, full of winos, homeless, spitting on the sidewalks, yelling and shouting at each other across the street.

In the early mornings the city sanitation water trucks go along the street hosing down the sidewalks and shop dorways to wash away the spit and pee from the day and night before

I wouldn't live in San Francisco if you paid me. Over rated, over touristed and over priced

username.exe

Parts of the downtown area suck, no doubt about it. (A few years ago I stayed on Ellis St in the Tenderloin area... oh my). But, to be fair it's not really that much different to most west coast downtown areas, certainly not San Diego, LA or Seattle. Btw, have you seen the downtown east side area of Vancouver BC? That is a shocker.
Urban downtowns here are a bit of a mixed bag. Some nice areas with bars and decent condos, and other parts are run down.

The Bay Area as a whole is lovely. Amazing scenery, interesting history and attracts a good crowd. Traffic is insane, though.

Moses2013

All valid points and of course many places are even more expensive (like London), but in London you probably have everything from fashion to musicals and in this area of San Francisco there's nothing. Yes sun, but no shops, boutiques and a lot of the big software companies that pay well, are over 30 miles away. According to data, a software engineer would make on average $103K a year, so even a couple earning well would struggle to get a mortgage. If highly qualified people can just about afford the mortgage in a not so fancy area, I don't see this going on much longer. These people will then be stuck in their converted garage (a big one) and will have no savings. As mentioned, property tax is also insane and that's what my mortgage would be in a year. Of course it's a different world, but I find it insane that people who are top earners aren't really that well off.

dc koop

San Diego is one of my favourite cities. I would have happily settled there, somewhere like in Encinitas or La Jolla when the prices of houses were about half of what they are today but my wife has a sister living Pasadena so she wanted to live in that area.

I have been through the east side of Vancouver on a tour bus and it was a shocker. I never expected places like that in BC. I've heard they're progressive though. The now have needle clinics where folk can go get a clean new needle and then do the deed

ChocolateBabz

Yep, $11,000 property taxes here in Houston, TX