Because big dense cities like NY are affordable?
I know plenty of people that make $30k-$40k/y in NYC and can afford to live in Bushwick with a few roommates and live nice lives. Single train commute into Manhattan, plenty of things to do that don't cost a lot of money, no need to worry about a car, etc.
Edit: a lot of people are replying that having roommates isn't tenable for $x or long-term. I agree, and I don't think we disagree.
Solving a housing affordability problem for people making $15/h starting their careers is part of the overall picture - housing available for people at every income level. An experienced worker with a family won't be looking to live in a 3br apartment with two roommates, but that same 3br apartment that was affordable can also house a family of 4 with two wage-earning parents.
NYC is _filled_ with people in all sorts of jobs who, because there is housing stock available in many levels, can afford to live alone, with a family in an apartment in Queens, or in a house in NJ.
It's not panacea - transit is not as reliable as I wish it was, goods are expensive, but it works for a lot of people
Being an adult who needs to have "a few roommates" to afford rent is not compatible with my idea of a nice life.
This sounds fun for a bit and then you grow up. If the Bay Area wants experienced workers filling non-tech/finance/medical jobs, they’ll need to better than this.
Those two together don't compute for most people. I'd say only a minority of people are fine with living permanently in a dorm-like environment. Historically, having to share a house/flat with strangers has always been a sign of poverty.
Why is this? It ultimately comes back to the Law of Rent. The amount that landlords are able to charge directly corresponds to the produce obtainable at that location over their next best alternative... and that alternative is likewise set that way up until you reach the "margin" which is the best available rent-free location.
Since all land has been homesteaded, there's not much of a ceiling on rents... they tend towards the entire nominal productivity of the site. And the more desirable that site is, the more astronomical the rent.
We want locations to be desirable, so in effect we actually do want rent to be high. It's just important that everyone share in that rising wealth. In other words, we need to create a high demand for labor, by shifting taxes from labor onto idle landlords. Land speculators are like patent trolls atop the surface of the planet.
I do believe that the thing that would change the housing stock situation for SF is to remove sales taxes and add land value taxes. Just that change alone will make workers and renters richer overnight, and would change the anti-development mindset of owners quite a bit, considering that low-dense units will pay the highest amount.
"A tax upon ground-rents would not raise the rents of houses. It would fall altogether upon the owner of the ground-rent, who acts always as a monopolist, and exacts the greatest rent which can be got for the use of his ground."
- Adam Smith, Wealth of Nations
"It is in vain in a Country whose great Fund is Land, to hope to lay the publick charge of the Government on any thing else; there at last it will terminate. The Merchant (do what you can) will not bear it, the Labourer cannot, and therefore the Landholder must: And whether he were best do it, by laying it directly, where it will at last settle, or by letting it come to him by the sinking of his Rents, which when they are once fallen every one knows are not easily raised again, let him consider."
- John Locke, "Some Considerations of the Consequences of the Lowering of Interest and the Raising the Value of Money"
It's known that land tax together with similar antimonopoly taxes can't be shifted. What's nice is that not only this type of tax doesn't slow down the market, but on the contrary makes it more effective. Essentially without rent capture (antimonopoly tax) there is an open sink in the economy, so no matter how hard people work, all this value exits out of the economy, mostly in form of parked money in real estate.
As George predicted, all technological progress will just yield higher real estate prices and everybody will be working even harder than before.
I agree a land tax would push the owners of vacant lots to develop them. But, the NIBMY owners of single family homes will still fight against the building of new apartment complexes and try to constrain housing supply (to prop up their property values). I certainly would hope that more apartments would be built though!
https://www.bloomberg.com/view/articles/2018-03-14/californi...
We know that artificially restricting the supply of housing increases prices.
Knowing why is important, though, and the law of rent explains the mechanics.
I'm in agreement with the idea that more building should occur. I'm just cautioning that even if someone destroyed every housing regulation in existence, or even if lots of public housing were built, we shouldn't be surprised if rents remain super high.
In the technology space we're used to seeing costs plummet from year to year. A land title system, by contrast, will predictably see increasing prices over time, while simultaneously extracting a flow of rent.
https://www.bloomberg.com/view/articles/2017-10-24/faster-gr...
The result has been predictable and inevitable when supply is growing slowly and demand is growing rapidly: increased prices.
The commute into Manhattan is about an hour, while not ideal its not that bad considering you're sitting on a train for that time, and its more of a self-inflicted wound given if NYC got its act together we could have much better public transportation. On top of that if you can afford it you can move closer by for a faster commute, and most people on hacker news are probably at least decently paid tech professionals.
Personally I have about a 20 minute commute and can easily afford the place I'm staying at. Generally if you're not dating/married you live with roommates, and if you are married then you have two incomes. I know other tech professionals in NYC that can afford their own place as well.
$400ish a month in maintenance seems very optimistic in my personal experience. There's always little bits of work to be done in a residence, and will be compounded when something major inevitably ends up going tits-up and needs replaced or serviced. Then on top of all of that, you have to have insurances and whatnot. Owning a house is great, but there's a fair bit more to it than just swapping the phrase "rent" for "mortgage payment" in regards to expenses.
>Given the median income in the US is 59k
For clarity, this is the median household income rather than individual.
All within 20 mins of subway within Manhattan.
https://streeteasy.com/for-rent/queens/price:-2500%7Cbeds:1
Also, if you want something a bit more trendy and family friendly, you can find plenty of apt. in Park Slope, (the equivalent of Noe Valley)
https://streeteasy.com/for-rent/park-slope/price:-2500%7Cbed...
SF just doesn't have the same amount of options.
I've tried to make the math work every which way - the Bay Are is just out of control, even compared to NYC prices. NYC compensates quite well by building upwards rather than outwards, this has a second benefit of reducing commutes (again, on a relative scale compared to the Bay Area.)