- The household income required to buy a typical home in San Francisco is now $US303,000, according to a report from Paragon Real Estate.
- Only 12% of households in the city can afford the median-priced home.
- The high cost of living is making it harder for tech companies and non-profit organisations to recruit and retain employees in San Francisco.
Being part of San Francisco’s middle class doesn’t mean you can afford middle-class living.
A new report from Paragon Real Estate reveals that the household income now required to buy a median-priced home in San Francisco reached an all-time-high of $US303,000 in December.
That means a person who wants to buy property in the city needs a mid-six-figure salary in order to afford the 20% down payment on a $US1.5 million home – the median sale price of a single-family home in San Francisco last quarter.
According to Paragon Real Estate, only 12% of households in San Francisco can afford it.
Patrick Carlisle, the chief market analyst at Paragon who worked on the report, has said low housing affordability is the greatest economic and social issue issue facing the Bay Area.
San Francisco, one of the epicenters of the tech industry, does not have enough dwellings to house all of its workers. Tech companies frequently locate their campuses in areas without much nearby housing, and tech workers often use their high salaries and stock options to bid up home prices.
Even tech workers can’t afford to live in the Bay Area
The report was unsurprising but still unsettling for Bay Area residents.
Katherine Maher, executive director of the Wikimedia Foundation,wrote on Twitter, “As a non-profit employer, I cannot see how we reconcile this with a future for our organisation in San Francisco.”
The non-profit was founded in St. Petersburg, Florida, and moved to San Francisco in 2008. Maher said that fewer than two-thirds of Wikimedia Foundation’s staff work out of the city office. The organisation has embraced remote work and seen “tremendous benefits.”
Maher said the findings of the Paragon Real Estate report are “nonsensical” to the group’s staff and donors, and the high cost of living hurts their ability to recruit and retain employees.
“Our local employees, particularly the younger ones, struggle to make ends meet. They leave when they start families. How can we be an equitable employer when only those who can afford to work for us, do?” Maher said on Twitter.
Mike Rosenberg, a reporter with the Seattle Times who previously worked at the San Jose Mercury News, responded to the report with some free advice for millennial homebuyers.
“You’d need to avoid eating 33,600 avocado toasts a year to generate $US303,000,” he said.