Families earning $117,000 now qualify as "low income" in San Francisco

[Bouncer]

SAN FRANCISCO -- A report out this week from the Department of Housing and Urban Development finds the median price for a single-family home in the Bay Area is now $935,000. A family earning $117,000 now qualifies as "low income" in the region.

CBS News went to see California's red-hot housing market with realtor Larry Gallegos. He showed us a house you would think he couldn't give away. But Gallegos says the home, complete with leaks in the roof, sold for $1.23 million. The buyer beat out six competing offers, all above the asking price.

"It's a little mind-blowing, but it is the norm around here," Gallegos said.

That norm is fueled by thousands of well-paid tech workers who have driven up the median price of a San Francisco house to $1.6 million dollars, the highest in the country. While housing prices are rising faster than incomes nationwide, nowhere is it more evident than in the Bay Area, where home values have soared a staggering 64 percent over the last five years.

That could explain how a 1,000-square-foot shell of a house in the heart of Silicon Valley sold for close to $1 million dollars. Also recently listed? A burned-out home near Google and Apple.

Serious buyers also better bring cash. Just ask Sally Kuchar, who tracks real estate for the website Curbed San Francisco.

"We cannot afford to live here, nor could we afford to live pretty much anywhere in the Bay Area," she said.

The same goes for teachers, hospital workers, police officers and working people all over, who make up the lifeblood of any community.

One flier could speak for the entire Bay Area housing market: "Enter at your own risk."

https://www.cbsnews.com/news/familie...inkId=53544816

[Keiser]

Yep it's nuts right now and still.... Nothing stays on the market longer than a week. Usually multiple cash offers on the first day of listing. I was renting a tiny little house in Burlingame for a few years, rent was $3800/month and the landlord ending up listing it for sale so I had to move out and he got like 7-8 offers on the first day. Ended up accepting an all cash 1.5 million offer.

This is where the money is.

[Bouncer]

This is where the money is.

there are states like Texas that are gaining real traction in the tech sector and are slowly attracting San Fran and Silicon Valley companies who can operate at roughly 1/3rd the cost. i do believe this will accelerate in the coming years especially if Cali costs keep rising at the rate they have.

but as for now and the foreseeable future the tech world is still very much headquartered here in Cali.

good article if you're interested.

https://www.bloomberg.com/view/artic...moved-to-texas

[chuckz28]

What's the point of making a bunch of money if you're spending it all just to live and having a lower standard of living than practically anywhere else in the country making 1/2 of the income?

If I make 117k in Ohio, I'm living really comfortably with twice the home and twice the disposable income, half the bullshit laws. For what? Weather? Lmao

[Keiser]

What's the point of making a bunch of money if you're spending it all just to live and having a lower standard of living than practically anywhere else in the country making 1/2 of the income?

If I make 117k in Ohio, I'm living really comfortably with twice the home and twice the disposable income, half the bullshit laws. For what? Weather? Lmao

It's a good question, but let's look at it like this:

Let's say 117k in SF is equivalent to making 40k in Ohio.

Ithink in places like SF you have the real ability to actually make something like 300k than you would 120k in Ohio. There are just more opportunities here if you want to hustle, since this is where the money is. You are also around the type of people who you can learn from and who challenge you to be better. This is where the hustlers are.

Also - The weather, scenery, restaurants, etc do improve your quality of life compared to some desolate like Ohio. And the people in Ohio aren't going to really challenge you to get better.

I still think San Diego is the perfect place to live. Still has some opportunities to make some money, absolute perfect weather year round, and about a 1/3 of the price of SF. (And much less liberal).

[Keiser]

there are states like Texas that are gaining real traction in the tech sector and are slowly attracting San Fran and Silicon Valley companies who can operate at roughly 1/3rd the cost. i do believe this will accelerate in the coming years especially if Cali costs keep rising at the rate they have.

but as for now and the foreseeable future the tech world is still very much headquartered here in Cali.

good article if you're interested.

https://www.bloomberg.com/view/artic...moved-to-texas

Salt Lake City and believe it or not Reno are other examples to this.

One challenge companies find when they move out of the Bay Area is finding competent workers.

[chuckz28]

It's a good question, but let's look at it like this:

Let's say 117k in SF is equivalent to making 40k in Ohio.

Ithink in places like SF you have the real ability to actually make something like 300k than you would 120k in Ohio. There are just more opportunities here if you want to hustle, since this is where the money is. You are also around the type of people who you can learn from and who challenge you to be better. This is where the hustlers are.

Also - The weather, scenery, restaurants, etc do improve your quality of life compared to some desolate like Ohio. And the people in Ohio aren't going to really challenge you to get better.

I still think San Diego is the perfect place to live. Still has some opportunities to make some money, absolute perfect weather year round, and about a 1/3 of the price of SF. (And much less liberal).

Plenty of opportunities to make over 100k in Ohio. Guess it just depends on the city and what not. I've been making over 100k the last 5 years or so on just a 2 year degree in Cincy. My job/company pays the same whether I'm in Cincinnati or LA or anywhere else so for me to make the same in California would put me in poverty when I'm loving very comfortable here.

[redback]

That's nearly as bad as Sydney house prices.

[rado]

Plenty of opportunities to make over 100k in Ohio. Guess it just depends on the city and what not. I've been making over 100k the last 5 years or so on just a 2 year degree in Cincy. My job/company pays the same whether I'm in Cincinnati or LA or anywhere else so for me to make the same in California would put me in poverty when I'm loving very comfortable here.

100K in any part of Ohio is a very good income, fact.

Even those who make $60/$50K do just fine.


That is one thing I will say when I lived there. Had the biggest house and land I've ever owned. 2 nice beautiful cars and a trophy wife who didn't need to work.

Granted I did make well over the 100s....but still.

[Keiser]

My career progression:

I made between 40k-60k when I lived in Texas
Made 70k-80k when I lived in Arizona
Made 75k-90k when I lived in Miami

Got a $140k offer to relocate to San Francisco. Was a very tough decision due to cost of living. Negotiated a $2k monthly housing incentive to finally pull the trigger.

Now, I make $350k+ - This would have NEVER been possible in Texas, AZ, or Miami in my line of work. So my point is, people are willing to take a $117k salary in SF and deal with the cost of living due to the possibility of getting their foot in the door for a massive opportunity. There is no real ceiling here.

Keep in mind California has the 5th or 6th largest economy in the entire world. More than most countries.

[Chadd77]

If I could pick up my property and move it to San Diego, I would consider it. Only because of the weather. The weather really is perfect there.

[Keiser]

If I could pick up my property and move it to San Diego, I would consider it. Only because of the weather. The weather really is perfect there.

It's perfect there, and honestly it's like another state. Nothing like the rest of Cali. Due to the military base there, it's much more conservative.

[Chadd77]

I've visited and did enjoy it but I have a large wooded private lot and a 5 bedroom house. No way anything like that even exists there and to have a lot with privacy would most likely be small to me and cost a fortune!

Both my wife and I make a decent living so we are able to enjoy ourselves comfortably where we live. And I just love the woods. Country boy at heart!

[Keiser]

I've visited and did enjoy it but I have a large wooded private lot and a 5 bedroom house. No way anything like that even exists there and to have a lot with privacy would most likely be small to me and cost a fortune!

Both my wife and I make a decent living so we are able to enjoy ourselves comfortably where we live. And I just love the woods. Country boy at heart!

True if you've got the land and you're in nature with a low cost of living then no reason to move. Maybe get a condo one day in San Diego and just travel back and forth.