Real Estate Prices in the Bay Area
It is said that the home prices in the Bay Area or Silicon Valley in particular are so out of reach for many families of middle income group. Even for the high paid tech workers of big companies, the housing here is not affordable. This is the very observation of a study conducted by a real estate startup Open Listings.
It is claimed that these techies employees can come close in affording an expensive Silicon Valley home than teachers, service industry workers and scores of other workers. But lately, there is now a signal of the area’s explosive housing costs that home ownership is not that easily obtainable by these techies or high salaried engineers.
In order to pay a home which is 20 minute away from their offices, software engineers for example at the Bay Area tech big companies have to even allot more than 28 percent of their monthly salaries. For example, 33 percent of the $188,000 salary per year of an average software engineer at a high tech company will have to spend this amount just so he or she can afford a home which is a median priced one in the area of Cupertino. Other software engineers in other high tech companies would allot 32 percent of their incomes or 30 percent or 29 percent for mortgage and tax payments.
Getting a home loan is still difficult for these employees allotting the above mentioned percentages of their income. However, if their loan is ever granted, the amount is not the full amount of the price which would need them to save more money in order to pay for the down payment. And if you are a resident already, it is not enough to pay for the rent which are high in prices even if you save a standard 20 percent to pay.
If this is difficult to have a home ownership in the area even for high tech workers, these local tech companies will have difficulty in recruiting and retaining employees then.
It is with this realization of the difficulty or condition that made the executives of these Bay Area tech companies to sign and support a bill that will make it easier to develop dense housing projects at nearby transit stations.
These executives expressed that the lack of homebuilding in the area is a hindrance in hiring employees and make their companies grow. They further stated that this shortage in housing would lead to displacement, rent burdens, long commutes and harm in the environment, and these companies want to be involved in the solution.