Percentage of salary spent on rent near technology companies in SF | Hacker News Reader

Percentage of salary spent on rent near technology companies in SF

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52 pointskaustin244056 comments

> Uber is located in 1455 Market St., which also is home to Square. Asking prices for one bedroom apartments nearby are currently at $3,421. That is actually below the citywide San Francisco 1-BR median, which currently hovers close to $3,500. Interestingly enough, it’s also less than what potential employees of Uber can expect to pay to live nearby the company’s new Stanford research outpost ($3,595/Month). Apartment finding in the Palo Alto area is pretty brutal as well!

The advice I would give to me 2 years ago: do not attempt to live in Palo Alto; same horrid cost of living as SF with the cultural/social opportunities of a Midwest suburb. Except with worse street traffic.

Edit: And fewer dive bars.

1455 Market is basically next door to the Civic Center/Tenderloin area. I'm guessing this would explain below-average rent, but employees certainly aren't living there.

Certainly?

For some added context, the apartment complex being described (next to Uber/Square/Twitter) is likely the NEMA (http://www.rentnema.com), which has received a bit of infamy not because of the prices, but the explicit targeting of techies.

Nice looking building. Looks like they throw a excellent Casino night/circus night, I think I saw Gavin Belson there.

On a serious note I am scared for the 20-somethings I saw in the videos. Downturns come with every upswing, and a lot of these people are going to wake up and realize they'd been earning six figure salaries, but have nothing to show for it.

Edit: Also, there's some truly terrible floor plans on the higher levels.

They can probably get by on the remaining $60k/year they take home after taxes and rent.

> earning four figure salaries

thousands per year?

Twitter sometimes uses NEMA to provide corporate housing to new employees while they look for their own place.

I'd much rather live in PA than SF. Not everyone has the same tastes.

You can't reasonably claim that an engineer paying 50% of their income after tax for rent is similar to someone making minimum wage and paying 50% of their income to rent.

High cost of living rarely limits itself to just housing.

They're surely better-off than a minimum wage earner, but I'm not sure that's a particularly important or useful point.

Isn't it though? Affordability has a different meaning for different people, and everyone has to make tradeoffs.

Is $3800 for one bedroom absurd? Yes, but I'm not going to feel sorry for the guy making 160k a year who can afford the apartment and a nice lifestyle. Especially when someone making less got forced out of the city because of the ridiculous rent.

It's not the same, but fiscally they're not really in that much of a better place. Too much going to rent, and not enough towards other living expenses, savings, and entertainment.

In either case, when the job is lost, they are both going to run out of money at about the same time.

Our local HRDC will flat out decline any form of housing assistance to anyone attempting to rent an apartment for over 30% their income.

The problem is that the other things shouldn't be measured as a percentage. If someone makes 150k and spends 70k of that on housing, they still have 80k left for other expenses. If someone is making 30k and puts 15k towards housing they only have 15k left for other expenses. So the person making 150k has 5 times as much left for other expenses.

If we make the assumption that they follow the generally accepted best practice for managing money, and put aside 20% of their income for a year, both people are homeless after 2 months.

Spending 50% of your income on a house is simply financially irresponsible, no matter your income. That's at a minimum 20% of your income that is going into a black hole that could be going into savings or investments.

How do you figure they'd be homeless in 2 months? That doesn't seem to follow.

While this threat is specific to the renting market, I digress to the general housing market,as renting has steadily turned into a very expensive option for most households in the bay.

We were in the market to buy a small home in the bay and were totally out priced from the market despite being a 2 income high tech couple. While most people talk about the hip SF and downtown areas, desirable homes in even more middle of the road places like Fremont and South Bay(Milpitas, Sunnyvale and Santa Clara) are over inflated. In one instance our offer was declined in East Palo Alto / East MPark area even after being over 22% of list price.

While I am not for protectionist ideas, It might be worth considering a cap on the number of foreign 'investors' in residential real estate -unless- they actually live in the home or area. I have seen that a huge section of the current price inflation is driven by overseas investors putting together a safe home for future generations without actually living in the place. This ensures that sufficient stock is available in the real east market.

Also all overseas cash home sales in the bay area above $'X' should be subject to an IRS audit to prevent overseas ill-gotten gains, corruption money or worse drug money being re-invested in US real estate.

Pittsburg, CA seems to be a 57 minute train ride to Uber HQ and has houses rent for $1800. That kind of commute isn't shocking for any global city. You could save a lot of money living there and nabbing one of these big salaries, and ideally you'd only come into the office 3x a week.

I'm not from the Bay but seems you could hack together a much better situation if your office is in SF vs Valley, due to BART and more land east of the Bay.

Your forgetting last mile times in that calculation. If you lived in pittsburgh it's unlikely you'll be living by the BART station, which means an extra 10-20m on your commute.

I Caltrain to work, and the "last mile" … on both ends … is the majority of my commute.

I agree you can hack together a better take-home pay situation, but Pittsburg, CA isn't exactly a quiet, pleasant suburb... it's more like shooting-and-stabs-ville. There are, of course, safer suburbs - with commensurately higher prices.

You can generally assume that if a property near San Francisco is affordable, there's something wrong with it: usually something like 'not actually being near San Francisco' or 'crime'.

That is true but also does not account for BART delays. A friend commutes that way and it is usually more of a 1.5 hour commute.

Having grown up around that area, and now living in Redwood City, that $1800/month house is surrounded by bad neighborhoods and a broken school district.

Concord and Martinez would be a much better and slightly closer option. I found 3bed 2bath rental Concord for $2300 last year for example.

The story assumes everyone rents(not true) and no one's commutes from East Bay or other city (not true).

Uber is also working on building a new office in Oakland: https://newsroom.uber.com/oakland/

> In fact, some of these workers joined 11 million Americans in spending more than half of their income on rent!

Difference is the other half is still more than most people make.

> https://www.reddit.com/r/personalfinance/comments/2e1q1s/30_...

Did someone really just reference /r/personalfinance as though it is fact?

I've always heard 30% of gross income. but whatever, it loses meaning when you can spend 50% on rent and still walk away with thousands of dollars a month.

> one of Google’s software engineers is living in a van!

by choice.

> Last year we noted that technology workers looking for savings may want to consider heading south to Silicon Beach

Oh but who would I work for down south? Oh your company.

Gee, I wonder why they wrote this.

> the $995 rental price nearby its office means SpaceX employees have the largest percentage of take home income in their pockets after paying rent each month

True, but the difference after tax and everything else is a few hundred dollars a month.

Mirror:

http://webcache.googleusercontent.com/search?q=cache:OuAnC8s...

Wait, a tech company in a residential area (RadPad, Venice Beach) has relatively cheaper housing within a 0.5 mile radius than tech companies in an urban area? Stop the presses!

(granted, it's impressive that this holds true even so close to the beach)

Venice is one of the most expensive neighborhoods in L.A. right now and is no less "urban" than anywhere else on the Westside.

But my point is that I'd call it less urban than SF.

Can people who live/work in San Francisco chime in on how you deal with these prices? Do you live farther away and commute, if so where do you live? Given the high concentration of tech companies in SF (and California in general) I feel sometimes the itch to move over there but with a baby on the way these prices give me a serious pause every time I consider it. I'd be interested in hearing about developers and people in general that have families who live and work in the area.

Spending 50% of your income on rent is only a big deal if the other 50% isn't significant. Someone who makes 20k a month but spends 10k on rent still has 10k a month for other expenses.

That said, I am a developer and live with my family about 45min public transit-only commute away. I've done the driving thing, I love reading too much to give that time away. My kids and my wife much prefer not living in the city and I get a 3+br for less than the 1br listed here.

I have rent control, so no worries except these golden handcuffs.

People I know who have young families bought their houses a long time ago or have so much money from when their startups IPOd or got acquired that the high housing cost is still small compared to their investment returns.

I work in south bay but my wife studies in SF. We live in an east bay city roughly half way between SF and San Jose. Quiet neighbourhood, close to BART, pretty quiet and the rent, while horrible still, is much more reasonable (we pay $1600/month for a ~650sqft 1br).

The downside is that you'll deal with a ~1hr commute to SF depending on how far you are from BART and if you're a young single engineer who loves to party, there's not much to do.

I'm paying about the same as the prices in the article but I rent an entire house in outer sunset. 3br/2ba with garage and backyard. I'm ~35 minutes from downtown SF on the N Judah line. It takes me 2 minutes to walk to the train stop.

It depends on what you value. For instance, I used to have a 1200 sq. ft. 2 bed, 2 bath apartment for $1200 in Pennsylvania. I moved to SF and I have less than 1000 sq. ft. and I pay twice as much in rent.

But, my wife and I enjoy going to concerts. In PA, this meant we had to drive an 1.5 hours to Philly, pay gas, tolls, deal with Philly traffic, pay for parking, then drive 1.5 hours back, and try to stay awake for the ride home. Also meant I couldn't really drink at concerts.

By contrast, I went to a concert at the Fillmore yesterday. 5 minute Uber to get there, dropped off and picked up in front of the venue. Home by 11. Yeah, we're paying $2500 in rent, but we are paying for intangibles like not having to drive home through sketchy areas of Philly in the middle of the night.

At the end of the day we just ask ourselves "are we happier here?". If the answer is "yes" then the rent is what it is, and we just live with it.

A bunch of them:

1. Live with roommates.

2. Commute from somewhere cheaper

3. Have rent controlled apartments. Rent controlled apartments from even 2 or 3 years ago are significantly cheaper.

4. Are dual high income couples

5. Own a place already.

The roommate stoodout. Know very few people that has a place by themselves. Also, doesn't look like they counted stock. Understandable for startups, but they included Google in that, 170k should just be cash comp.

It still baffles my how much google is paying compared to MSFT or Amazon in Seattle. Some crazy numbers there.

When the tech companies move because the city won't let developers build more housing units, the bubble will burst.

The link is down right now, but I'm glad to hear Uber has the generosity to give their drivers a 20% raise.

If only there were some way for Uber employees to commute to work from cheaper parts of the city. Maybe an app or something.

You mean using an app to hail a ride? Seems like a great startup idea right there.

Rent is a real motherf###er

I don't see why this was downvoted, as it is factually correct and is often a large blocker when it comes to people living near tech/financial hubs around the world. Hence having to commute for large lengths of time merely to sit in a chair at some office for hours on end.

"Youth is wasted on the young". Why not save a little for tomorrow, you might be able to actually own if you do?

Are you criticizing the employees for wasting their money on frivolities like a one-bedroom apartment?

Living in SF is a choice, for technologists. In addition to the absurd rent, there is also the lifestyle nominally associated with the choice to live in SF. The bars, the restaurants, the nightlife, the shows, etc.

It's a perfectly valid choice to take advantage of that when you don't have a family and all the associated responsibilities yet.

Look at all the baby boomers now who 'didn't save enough to retire', it's crazy to spend 50% of your income on rent.

I fully agree. Personally I would hate to spend 50% of my earnings on a rental property month after month. Suppose there's not all that much that can be done about it given the constant population growth and everybody wanting to be close to urban centres. Makes it very competitive.

I say: save while you can, when you start a family you will save a Lot less

I fully agree. Making a great salary with a great job, probably working really hard, save that so when the time comes you are ready for your next adventure or family and not still worried about your 3.5k/mo rent. Hindsight is always 20/20.

But no, we must experience "the city" at all costs...

...and keep repeating that "the city" is the best place in the world, at every opportunity, especially since no one outside gives a rat's ass.

You care so little that you have to point how stupid they are for living there.

I live there

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