September 16, 2017

SF Median Home Price to Median Income Ratio: 10.8x

The Real Bay Area is simply firing on all cylinders!

Congrats to San Francisco Peninsula Metro for having a median home price/median income ratio of 10.8x.

Congrats to San Jose Metro for having a median home price/median income ratio of 7.8x

Suck it New York Metro with your paltry median home price/median income ratio of 5.8. Delete your account.

If we all pull together, we can drive this to 15x. What will you be doing this weekend to help increase the ratio further?

Comments (9) -- Posted by: burbed @ 6:05 am

9 Responses to “SF Median Home Price to Median Income Ratio: 10.8x”

  1. Tomas Says:

    Burbed – was lurking around old threads in Patnet & came across some of yours. All were filled with snark and angst about prices, so I came here to see how things went for you. Turns out, you are still (kinda) posting.

    Mind if I ask you, respectfully, what is the end game for you here? I too was priced out, but I eventually moved on, bought elsewhere and quit posting. Yet some people are still at it for now going on multiple decades.

    Not sure where I am going with this thought, but all I can say is I hope you find peace in this world.

  2. Dewane Says:

    Welcome back! We bought three years ago, against the advice of my mom, who is a reverse barometer of future events (the end of days didn’t happen in 1980, the market four years ago was not “at the top”, it was not a “great idea” to buy Internet stocks in 1999). Now, it’s extremely hard to move money out of China, yet we keep seeing this. My theory is that the rest of the country is so bad. We have a friend who might be buying in Houston, because houses there are at rock bottom currently.

  3. ed Says:

    I, like many who used to come here a lot during the “Good ole’ days” of the last housing bubble would like to see this forum revived. Yes, obviously its not your thing anymore, which I respect, but still- we’re in the midst of another even worse bubble and there are now few places for people to discuss it anymore. But nonetheless here’s a few of my observations:

    Not only is there a housing boom but a pronounced tech boom. This has had a profound effect on the bay area not just in home prices but a lot of other things. The worst IMHO is the traffic and the sheer volumes of people. I commute from the east bay to the peninsula several days a week. Thank god my employers lets me work from home a few days per week because otherwise traffic is just unbelievably AWFUL.

    And its not just rush hour, its ALL the time now. I used to leave the house at 6:30AM to beat the traffic. Now its impossible to leave at anytime, no matter how early and not encounter a crush of traffic. 6:00? 5:00? Doesn’t matter. What used to take 45 minutes went from that to an hour and then an hour and a half and now even sometimes 2 hours. In the afternoons both 880, 580 and 101 turn into virtual parking lots. Its a major problem. There’s just too many damned people.

    Housing prices. They are absolutely insane no matter how you cut it. Places like SF and San Jose are simply out of reach and out if sight. Its the same for rent. And unlike the last boom the bubble has really hit places like downtown Oakland which all through the last boom remained its old, papered over and economically depressed self. But now? Go downtown and there are now blocks and blocks of wine bars, art galleries, breweries and fancy restaurants.Its right back to where we were and worse where whereas we bought 5 years ago and make an upper level income now we would be spending almost all of our income on the mortgage if we bought our house now. We live in a plain 60’s rancher home and the ones that have recently sold were all in the 900k+ range, which is frankly nuts.

    None of this is healthy. All of it reflects on an area where its own success is in turn creating an overall poor quality of life for everyone. If I could retire now I’m not sure I’d be staying. The traffic, the sheer numbers of people always in line no matter where you go, the price of everything and lack of affordable housing for most of my friends and family who still rent is all depressing.

  4. burbed Says:

    The solution is pretty simple – go back to 1978, buy a house in Mountain View, wait, campaign to ban more housing, repeat. And the you can retire to Hawaii with plenty to spend.

  5. ed Says:

    “The solution is pretty simple – go back to 1978, buy a house in Mountain View, wait, campaign to ban more housing, repeat. And the you can retire to Hawaii with plenty to spend.”

    As someone who went through two cycles of boom and busts in the Bay Area, the last where I wound up losing my job due to the recession for a few months there’s something to be said about hind site.

    We bought our house some 5 years ago at what would later turn out to be the trough of the last housing bust. No, it did not feel like it and no, its not like what we paid was amazingly cheap. Not by a long shot. We paid around $480,000 for a 3 bedroom house. So its not like we got some screamin’ deal. Its just that for a brief period of time the prices, interest rates and the cost of rent suddenly reached a sort of parity where the cost of rent and the cost of buying became more or less equal.

    I say hind site because I recall some 10 years ago, back when the last bubble was raging I had a coworker who was sort of like me: drove a normal econocar,decent job, saved money etc etc. He had bought a home in around 1996-97 and according to him it seemed that there was about a 6-12 month window where it actually made sense to buy. And then came the tech boom.

    That doesn’t mean to say that everyone buys during that time. Unfortunately people continue buying right up to the absolute bleeding edge of what they can possibly afford meaning that those whom have a degree of financial sense and self preservation are often locked out fairly quickly.

    In hind site we did the same as my former coworker. At the time it felt like a big risk. But in the end it was a good choice since rent has gone up and so too has the cost of buying. As far as our home’s value its all paper wealth anyway and I do not count on it as anything other than a house to live in.

    All I know is that I have many friends and even a brother who live here and are having an increasingly difficult time living here. The area I live in is slowly being gentrified and made to feel more like some of the “fancy” areas in Silicon Valley, which I detest. Some of our friends have left for other states. Its sad to see because its an example of classism and frankly if the entire Bay Area turns into one big gentrified chunk of land I’m not sure I’d want to stay.

    As for you Burbed, I know that you’ve never-ever revealed anything about yourself and I can respect that. But how are things? Hopefully well?

  6. madhaus Says:

    Wow, looks like people are still showing up hoping to see some new articles. I’ve even thought about writing some. Ya never know!

    My million dollar shack in Sunnyvale is now getting pretty close to a two million dollar shack, which is just flipping ridiculous. I still hate Prop 13 despite benefiting from it (I bought 25 years ago so my taxes are around $5K), and even I was surprised by that Sunnyvale house that went for $640K above asking. If downtown Oakland is getting all yuppified, what’s next, or rather, what’s left? Hayward? San Leandro? Pinole? Vallejo? Is the Real Bay Area expanding again, to fill almost all the Bay Area? That’s the surest sign of peak of the market. But when the Merc has a story about how Mountain View has gotten too expensive, so Sunnyvale is hot, except face it, Sunnyvale has gotten too expensive as well, so head to Santa Clara!

    It’s too bad Redfin nuked their forums, there was good discussion there. Guess we should invite everyone to come back here.

  7. A. Lewis Says:

    Hi madhaus! Missed you guys.

    Tomas raises an interesting and uncomfortable point. I mean, I’ve always been in the camp that houses in the bay area (especially the hot spots, subjectively defined) are vastly overpriced. I’ve always thought there should be a reckoning and big correction – yet for over 10 years now I’ve continued to be wrong. I can admit that. I wouldn’t have believed prices would climb to where they are now, but they have…I was wrong wrong wrong. But it still feels wrong, so I still look for Burbed postings.

    Now I’m part of the problem – I bought a house (gasp!), over here in the East Bay. I think I vastly overpaid for it – but I did it. I don’t know what my end game is – I don’t know if I need one, Tomas. Maybe we’re just here for fun?

    I think it’s just to keep gaping at the stunning numbers, and if one day there is a reckoning (i.e., major price crash), we get to say I told you so…if not, the Real Estater’s out there get to keep laughing at us.

  8. ed Says:

    I’m not sure where this ends either. I also don’t see how this is sustainable. I have a number of friends whom make a decent income and yet are now actively looking to move somewhere else because both rent and buying are getting to nosebleed levels. That leaves either the old farts who bought a long time ago or some of the more handsomely paid techies.

    And Oakland… it too is becoming just another latest casualty of gentrification. Even as recently as a year ago there were many empty store fronts downtown. Now they are mostly filled up and now even have the “latest thing” which seems to be taking old shipping containers, painting and fixing them up and turning them into coffee bars and fancy food places to be put near sidewalks. Forget parking anywhere near downtown too. Its totally packed.

    The traffic just gets worse and worse. More and more keep on moving in and more and more buildings are being built. I’d say a good 10% of the traffic I encounter daily are construction related vehicles. Around my office are areas filled with campers and RVs. Apparently many contractors are simply coming in from wherever for work and living in their campers. Pretty smart if you ask me.

    That and at least in the East bay the homeless population has exploded. More and more people have been forced from their homes due to higher rents and now if you drive in certain areas there’s entire tent cities stretching for blocks on end.

    Something has to give. At some point even the most well-paid engineer or tech person will reach a point where they can’t afford it anymore.

  9. Real Estater Says:

    Traffic is not as much of a problem if you live on the peninsula. The reason is that if you commute elsewhere you are always against traffic, and if you work locally your commute is short. The one exception is if you need to go to SF. I avoid going there if at all possible.


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