
Employees at Airbnb, Square and Stripe Are Spending 50%+ of Income on SF Rent - kaustin2440
http://blog.onradpad.com/employees-are-paying-this-much-to-live-next-to-unicorns-in-sf/
======
aaronbrethorst
That's ok. When Airbnb, Square, and Stripe IPO in 12-36 months, all of the
people currently flooding into SF to work for them will surely be able to sell
their pre-IPO shares to ... Well, I don't know, honestly. I doubt that
employee #1000 at Square would even be able to pay the down payment on a SF
condo with their earnings.

Also, just FYI: Seattle isn't _that_ much cheaper than SF, the people are way
meaner, traffic is awful, and the weather really sucks. So I _highly_
recommend against moving up here.

\---

edit: Since people are apparently missing the joke, I've lived in Seattle for
12 years, consider it home, and can't imagine living anywhere else.

~~~
jusben1369
Everybody is running with your Seattle humor but your comment on IPO'ing is
worth discussing. 1) The reason a startup is appealing is because you're
supposed to make a great low 6 or even 7 figure sum once your company goes
public. 2) To achieve success you're supposed to work intensely hard and smart
(@pmarca) for a short period of time (3 - 7 years) and then if you've picked
successfully you'll create a really nice nest egg for yourself while you're
peers who graduated will only be up to around $50K in their contributing
401K's. 3) Based on the size of that exit you are free to go somewhere else
and enjoy luxury or double down in the Bay Area but this time with a little
more money to get a better apartment or even buy something in the burbs.

So the point is looking at just Income isn't helpful. One would hope your
stock is appreciating in value at an equivalent or greater pace than your
income.

~~~
dragonwriter
> One would hope your stock is appreciating in value at an equivalent or
> greater pace than your income.

OTOH, hope is not the same thing as reality.

 _Some_ startups will exit successfully and yield really big payouts. Some
startups will have modest exists, and equity will have _some_ additional
value, but nothing to write home about.

And some startups will fail.

If you are a capital investor in lots of startups, the small share where the
first occurs have a good chance of being enough to make the average return
good. But if you are a 20-something that's putting 3-7 years of labor into
each swing at the startup piñata...

~~~
nvader
I love the mental image evoked by a startup piñata because it is so deep with
symbolism: blindly swinging away at a brightly-painted papier mâché dream,
hoping for the outpouring of sweets by sheer random luck.

Hopefully people are putting a little more thought into their career choices
than that, but piñatas are definitely fun, and you're surrounded by your
friends shouting encouragement and direction at you all the while. So while
I'm positive that life isn't as bleak as this image conveys, I'm still going
to borrow it to use in the future!

------
azakai
The reasoning here seems wrong. Yes,

> "the rule of thumb is that you shouldn't spend more than 30% of your monthly
> take home on rent",

as they say, but that's just a rule of thumb. What actually matters is how
much money you end up with. For example, assuming taxes remove 30% of income
(probably close enough; would need to look up federal and state tax codes to
be precise),

1\. A Zynga employee makes 147,000, loses 30% to taxes, spends 3,545 times 12
on rent, and ends up with 60,360 to spare.

2\. A RadPad employee makes 120,000, also loses 30%, and spends 1,475 times 12
on rent, giving them 66,300.

In other words, while the Zynga employee spends 47% on rent, and the RadPad
employee a mere 23% - less than half! - the difference is much smaller than
that would imply. At the end of the year, the RadPad employee has an extra
5,940.

Certainly a significant amount of money, and noteworthy in that the person has
a lower salary but still ended up with more income after taxes and rent, but
the amount is in the single digit percentage of the salaries we are talking
about here.

More importantly, the problem becomes more obvious if we look at second place
after Zynga. Doing the same calculation on a Google employee, then we get that
despite paying 42% on rent, the employee is left with 71,128, which is more
than the RadPad employee.

In other words, looking just at % of take home spent on rent is a useful rule
of thumb, but looking at the actual money is better, and it can lead to
different conclusions than the article would imply.

edit: Perhaps the best conclusion from their data is that it actually doesn't
matter where you live, since salary actually compensates surprisingly well for
location. Whether you work at Google or Zynga in SF, or RadPad in LA, you'll
end up with +- a few % of the same amount of money in your bank account
anyhow.

~~~
ecdavis
The 33/33/33 rule aims to provide you with enough savings to cover your
current cost of living in retirement. It's based on the assumption that your
cost of living won't drastically change in the meantime. That assumption
breaks down when you're living in a very high cost of living area where you
don't intend to retire. I doubt that very many people who live in 1BR
apartments in downtown SF will maintain that lifestyle into retirement.

~~~
dkns
For those who don't know 33/33/33 rule is it rent/expenses/savings?

~~~
ecdavis
I think it started as expenses/spending/saving but has now become rent/other
expenses+spending/savings.

Recently I've seen other "rules" emerge which are far heavier on the expenses.
Fidelity, for instance, suggests a 50/15/5 split between expenses/retirement
savings/short term savings. I think having such high expenses is pretty risky,
myself.

------
roymurdock
I always see articles like this and I wonder...who is _winning_ here?

I'm waiting for an article to break out the stats on who owns which property
in these types of areas. What % of housing is owned by the government, foreign
investors, domestic investors, institutional investors, real-estate holding
companies, and the actual inhabitants of the property?

For all we know, the whole story could just be that tech companies are hiring
some kids from ivy leagues and well-off families that are just paying rent
back to their parents, who somehow or other own shares of the SF property
market. Or that a lot of rent money is flowing to foreign investors, as is the
case in NY and London.

So while it's interesting to see who is losing and by how much, what I'd
really like to know is - who are the winners? Where is the money flowing?

~~~
sawthat
Long story short: people that own single family homes in SF are winning the
most because of the massive gains in value and we don't have to pay increased
property taxes because of proposition 13. Basically anyone who currently owns
property in SF is a "winner" and that includes the many small time property
owners that own the 2-6 unit buildings that dominate the city. The rent money
is flowing to those people. Who probably are mostly local.

~~~
ryandrake
Local and elderly. Prop 13 is basically wealth transfer from the
young/newcomers to the old-timers.

~~~
philsnow
the new new california gold rush already happened; it ended when all the bay
area real estate was bought up

------
cdnsteve
Seriously, the number of companies still not hiring remotes is ridiculous. We
work in the most flexible industry out there yet most companies still want you
sitting in a chair in some downtown office of a giant and expensive city. No
thank you. No you don't need to make your entire team remote but you can
easily augment a large portion with talented remotes. Keep your high living
costs and horrendous commutes, been there done that. There are other options.

~~~
jaggederest
I deeply enjoy when recruiters are convinced that I'll move to SF for _their_
company, even though I haven't over the past decade. They also balk when I ask
for the cost of living adjustment to make the move (+180%, give or take).

~~~
x0x0
Hell, I live in the peninsula and I ask for a $40k ($2k/mo after taxes) raise
to cover the rent differential to move back to sf in order to be in the office
5 days per week and companies are taken aback.

------
nullrouted
Which is silly....honestly companies need to start opening offices in more
affordable areas. Colorado (Blouder, Denver, The Springs), Texas (Austin, San
Antonio), Missouri (Kansas City, Saint Louis)....there are so many places you
can put your employees that saves them money as well as your company a lot of
money not only in Salaries because you'll be able to employees less but your
rent/power/etc.

~~~
proksoup
I am spending 50% of my after-tax income on rent. The 50% I have remaining is
more in SF than what I was making in Phoenix or Little Rock or Lincoln.

The amount of choice in employer I have as an individual is also much greater
here.

Still, I'll probably head back to one of those "small" towns soon. Not really
worth it here for me personally, despite the employer-choice and the $.

~~~
xenadu02
I'm spending 25%. I have the whole house 3br/2ba, a garage, and a back yard.
Unfortunately single-family homes in SF aren't rent controlled.

You only have to spend 50% if you want to live in a hipster/trendy area of SF.

~~~
falsedan
The cheap places in the Sunset disappeared a long time ago

------
dkasper
This is not a great analysis. What they measured was average salary compared
to average rent in the neighborhood where the company is located, not what
their employees are actually paying. At Weebly I would estimate less than 10%
of employees live in Soma where our office is.

~~~
shlant
I had thought your office was in the financial district on Pacific?

At least that's what the window said when I walked by it every morning on the
way to work.

~~~
dkasper
It was for a few years. We moved last fall to 3rd and Bryant.

------
whalesalad
This is not surprising at all. We keep complaining about it here and elsewhere
but it's not going to change any time soon. The more people flock to SF the
worse it will become.

When I left SF my studio "jr. one-bedroom" in SOMA was $3100 a month. I'd walk
or muni to work by the ballpark and usually saw at least one person smoking
meth, shooting up heroin, or pissing on the street. I pay less than half of
that now for a 2 bedroom house in Michigan and have a stress-free 20 minute
commute to the FarmLogs office.

~~~
suryon
3100 is almost double the average salary of IT worker in Central/Eastern
Europe and these people are considered middle class.

Take a look at China and India there they earn even less.

How many and for how long can these companies keep hiring people for such huge
salaries ? And if these people can't live comfortably off these salaries then
there is something wrong.

~~~
whyaduck
Complex cross-geo projects aren't the same as local projects, except
everything happens overnight. There are explicit and implicit expenses
involved in managing and supporting projects in widely varied time zones that
aren't obvious until you're involved in one. Especially if there's hardware
involved.

------
slg
I certainly think rising housing costs are a problem, but is no one going to
comment on the fact that this company put together a list that just so happens
to put them in a very favorable light against companies they are competing
with for talent? We probably shouldn't just accept RadPad's statement as fact
that RadPad's employees are much better off than other startup employee even
though they are paid less. I would be very interested in seeing the actual raw
data that includes companies not listed here and includes other costs besides
housing (e.g. transportation costs are higher in LA due to a worse public
transit system).

------
ec072201-474b
I was recently contemplating the hostility between tech workers and some SF
residents who have lived here longer. Long-term residents blame tech workers
for increasing housing prices and resulting evictions, but high rent is
detrimental to both groups.

Then I considered the interest group who is coming out on top in all of this:
SF property owners. The total value of all residential property in SF is
probably well into the hundreds of billions (a few hundred thousand units,
multiplied by a resale value probably approaching a million dollars per unit).
That value is driven by scarcity.

So you have a group protecting a half trillion dollar investment. Is it really
so surprising that they have convinced long-term residents (most of whom still
rent) and populist politicians to rally in favor of scarcity?

Is anyone trying to organize a coalition of tech workers _and_ long-term
residents against SF property interests?

~~~
rconti
Prop 17 in CA magnifies the effect. When your property taxes can only go up by
a small amount every year, there's literally no incentive for your property
values to not go sky-high.

~~~
vonmoltke
The critical flaw in Prop 17 is that it applies to nearly _all_ properties.
Florida did homestead protection right. The homestead protections there are
nearly as strong as, if not stronger than, Prop 17; however, only _owner-
occupied residential properties_ qualify. I think it is ridiculous that
someone can move out of their house or condo in SF, rent it out, and still
reap the property tax benefits.

------
nickbauman
Always remember the #1 industry sector in CA is real estate, not tech.
Furthermore, this is why I generally won't consider offers for work in the Bay
area (as much as I love NoCal). I do the math and realize I'm cutting my own
throat.

On the other hand, I'd love to get a great offer and then buy a Blue Bird bus
and convert it into a rolling home but only if I could semi-permanently park
it in the company parking lot!

~~~
chucky_z
I would say you can park in Palo Alto in an RV for free... but it looks like
that's changed in recent history. Kind of sad! :(

~~~
yellowbeard
Pretty sure I see people living in RVs in Palo Alto, on El Camino and around
Cal Ave. Definitely plenty doing it in SF. Has something changed in PA
recently?

~~~
chucky_z
I do as well, and while looking around for laws about it I stumbled across
this:

[http://www.wsj.com/articles/SB100014240527023038478045794799...](http://www.wsj.com/articles/SB10001424052702303847804579479930243974564)

and a few articles like it. It seems the laws aren't well enforced though
(probably for the better).

------
snomad
I remain surprised that Bay Area tech companies don't move to Sacramento. Near
the Bar Area for quick access, near the state seat of power for lobbying, well
away from major faults so less prone to earthquakes, significantly lower costs
of housing (2 Bdrm apt would be about $1k) - so presumably could save on
salary.

~~~
chipotle_coyote
The problem is that "near the Bay Area" is pretty relative; the travel between
them is 2+ hours without substantial traffic, and most people aren't going to
want to make that commute. So that leaves you with some of the drawbacks
others have mentioned in this thread: if your company is there, you'll likely
have a smaller talent pool to draw from; if you live there and you lose your
job, you'll have a smaller pool of companies to move to.

Having said that, Sacramento is a _much_ nicer place than a lot of folks in
the Bay Area give it credit for -- a lot of pretty, walkable neighborhoods, a
lot of good cafes and bars and restaurants and "third wave" coffee places, and
as you mentioned a way lower cost of living. The only real downside (setting
aside the commute) is that it gets ungodly hot in the summer.

------
20years
Why aren't more companies investing in building out remote teams? Have the
main office with a small core team in SF but hire remote devs, customer
service, sales. Seems like it would save companies a ton of money and devs
would be happier too because they would actually be pocketing more.

~~~
sawthat
People have been trying to do this for thirty years. No idea why it never
seems to stick, but it doesn't.

------
JDiculous
I have no interest in moving to SF mostly because of the rent. Spending 33%+
of your paycheck on rent is absurd. I'd rather get a remote job and live
somewhere cheap enough to where I could potentially put a down payment on my
own place.

~~~
justaburner2015
The nicest, most expensive 1 bedroom apartment I can find in
$my_medium_sized_city is $1200/mo. Brand new, great view, walking distance to
everything...I don't even own a car anymore.

Any kind of six figures goes very, very far if you are willing to be away from
the center of the universe. If living in SF to work at a startup with options
is speculating in penny stocks, living in a second or third tier city and
squirrelling away a nice chunk from $120k a year is buying bonds. Lower
variance, lower maximum rate of return.

------
Animats
That's the new normal.

In the 1950s, the average New York City resident paid 10% of the income for
rent. It was federal, state, and city policy to keep rents down, with new low-
cost housing being built by Government agencies and insurance companies.

------
minimaxir
This article makes the rather flawed assumption that all the housing in SF is
being taken up by people who work at startups, and not by people who work at
Facebook/Google but live in the city and commute, who likely are both more
numerous and have even greater salaries.

The article doesn't mention studio prices at all, which are high but not
stupid high.

~~~
rco8786
FB/Google do not employ more in SF than the long, long, LONG tail of startups
in the city. They probably do have higher than average salaries though.

------
gricardo99
I recently turned-down a great job offer for a Bay area tech company. Their
office was just too far outside my commute range. I even offered to remote-
work part-time and be in the office some days a week (I had already been a
100% remote worker for 3+ years, so I had a proven track record as a remote
worker). But the founder insisted everyone be on-site, daily, even though many
aspects of the company were quite comfortable and capable with remote-work
(they had a remote team in Europe).

This "must be colocated" mind-set is lose-lose no matter which way you cut it.
I turned down a compelling/interesting job, the company lost a great-fit. If I
had taken the job, burdened with an absurdly long daily commute, we both would
have lost time/productivity to commuting (not to mention the broader societal
costs).

Maybe it's going to take a billion-dollar startup to scale-up with a
remote/distributed approach to really shift things.

~~~
sjg007
I thought the example already was Atlassian.

~~~
gricardo99
If you're talking about their products, yeah that's my point. Plenty of
products for remote/distributed collaboration. If you're talking about their
workforce... not so much. Just checking their careers page, and every job I
saw was tied to some location. Didn't see a single "Location: Anywhere" job
posting.

------
nilkn
Unless I won the stock option lottery, I think it'd be more cost effective for
me to do a complete career transition to, say, medicine or dentistry,
including lost income and educational debt, than it would be to move to SF as
a programmer. Granted, I'm fortunate to have a relatively high salary in a
much cheaper location right now.

------
danso
Do (m)any of the SF startups allow workers to occasionally commute from places
like Sacramento? I actually knew bankers who lived in Sactown and got up at
5AM to head out to SF every morning. But technology requires less in-person
time. And Sacramento is much, _much_ cheaper than the Bay Area...I shared a
great 2-bedroom place in the nicest area of town for around 1,200, where you
could walk to great food, parties, and bars. I now pay way more for that to
live in a converted garage in Palo Alto...in fact, this garage costs more than
my nice 2-bdr apartment did in downtown Manhattan.

Even if you commute 3 times a week from Sacramento, you'd save a lot of money
while still having a good social life...and 3 days/week in-person seems
sufficient for a lot of dev work projects.

~~~
idlewords
The commute from Sacramento to SF is not really workable. Traffic across the
Bay Bridge has reached a point where there's almost no lull, and parking at
BART stations is impossible to find. I go to a Sacramento colo sometimes and
would never dream of trying to make the trip on a weekday or Sunday afternoon.

~~~
danso
Oh good point...I'm speaking from experience that is now about 7 years old...

------
baddox
Of course, that's not actually a bad thing if their remaining income is higher
in absolute terms (or adjusted for non-rent cost of living) than it would be
in other cities. The percentage income isn't really relevant on its own. I'd
rather make $10m a year and spend 90% of it on rent than make $100k a year and
spend 20% of it on rent.

And when you add in the subjective value of living in SF (which is small or
perhaps slightly negative to me, but surely large for many people), it could
still be a perfectly reasonable decision to live and work in SF.

------
jaz46
This article is missing one really key point about working for these unicorn
companies, the stock that goes along with salary.

The article is comparing salaries of mid-senior level engineers and that
$120k-$150k salary also often comes with $200k - $1+M in stock. As a SF-based
startup founder and having been in tech recruiting for years, the clear upside
of working for a unicorn is the stock with much lower risk of downside, but
still plenty of upside growth.

If you look at percentage of Total Comp to rent, the numbers aren't nearly as
outrageous.

~~~
ryandrake
Unless you're getting actual, liquid, tradable stock, it's fictional
compensation. You can't pay rent with "upside".

------
burnallofit
Nobody wants to bother questioning the numbers. The first line shows Zynga,
$3545, $147K, 47%. First hit on federal income tax calculator using single
standard deduction no kids gets a federal tax liability of $30K, leaving $117K
or a monthly of $9750, so $3545 is 37% of after tax income, which is not too
bad. And anyone making a decent income should put some thought and money into
deductions: 401k+HSA/FSA being the obvious ones. But actually, the 30% of
monthly is generally calculated before taxes, so at 147K the monthly rent
could be up to $3675. Not that I'm recommending spending that much or
approving of the astronomical SF rents, but any article on the subject should
at least do math correctly.

No, what's really going on is a certain company is trying to justify paying
employees 20% less, under the excuse that local cost of living is lower. So if
I live in SF in my parent's house and pay little to no rent, someone can pay
me less? What if I eat ramen instead of going out to eat every night? That's
absurd -- we should be paid according to what value we bring and it's up to us
how much we spend on cost of living. In fact, a company in LA that can't
attract top talent such as presumably are now in SF should be offering even
higher salaries.

------
mightybyte
I'm in NYC and I pay ~10% of after-tax income for rent. I visited a friend in
SF recently and after hearing about his situation I concluded it would be very
difficult for any company to get me to move to the Bay Area. It just doesn't
make financial sense for me. NYC has plenty of tech opportunity, so that
doesn't tip the scale either.

~~~
prospective4334
I have to ask: which neighborhood do you live in, and how far do you commute?
I'm moving to NYC in two days and I still don't know where to live
(thankfully, my company will pay for a nice apartment for 30 days).

I actually wrote off SF and the entire Bay Area during my job search, largely
due to the cost of living. I know that in New York I'll at least be able to
find a 1br for $1700 (in Western Queens or Wash Heights, whatever), which is
25-30% of take home.

~~~
mightybyte
Jackson Heights. It's ~20 minutes to midtown.

------
blisterpeanuts
I love these high salaries. My thought is to find a job in SF, live there
temporarily for 3-6 months, then become remote and move back to my real home
on the east coast. Is that feasible? Aren't these kinds of companies pretty
comfortable these days with video conferencing, IM, screen sharing etc.?

~~~
minimaxir
One does not simply "become remote."

There are strong advantages to working in direct contact, despite what
sentiment on HN and logic dictates. Working in SF for a few months wouldn't
make you super rich anyways.

~~~
nilkn
I think his/her strategy of working in SF for a few months at first is not to
become "super rich", but to establish a high salary that could then be
"exported" to a cheaper area while staying on with the same company.

~~~
minimaxir
I'm reasonably sure that a decrease in CoL would be adjusted into the salary,
or at the least, any company in a lower CoL is less likely to give a
competitive salary.

~~~
blisterpeanuts
So if you are living and working in SF and making $150K (plus bonus, stock
options etc) and you decide to move to, say, Phoenix and buy a house for
$140K, they'll say, "OK, minimaxir, we'll be cutting your salary to $90K to
reflect the vastly diminished cost of living, although of course we'll be able
to give your desk to a new hire and save money on office space!" \-- ??

Seems unlikely. If you're contributing, no rational company is going to
suddenly cut your salary. Basically, no one cuts salaries in the U.S. unless
it's a company-wide belt tightening move to stave off bankruptcy.

~~~
eitally
You can't make a statement like that without facts to back it. The truth is
that companies do this all the freaking time. Besides that, it has also been
common for a decade+ for CA-based employees (both LA & SFBA) to sell their
artificially inflated house and quit their job to move a lower COL state
(often Texas, Washington, Oregon, or North Carolina, all of which are much
cheaper and have lower income tax schedules). If they stay with their existing
company, their salaries are frequently decreased based on COL calculations.
Otherwise they use the previously mentioned tactic and quit for something
different, using their current salary as a negotiating point.

~~~
blisterpeanuts
Any citations for this "all the time" claim? It's not against the law, but I
would think (and online discussion/blog/advice seems to support) that most
people would rather quit, as you suggest.

------
geogra4
I live in Detroit, own a 4bed/2bath and bike to work everyday for a mortgage
that's less than 1/4 of the rent median SF 1br.

SF is a cartoon world. Yes salaries are less here, but I feel so much more at
ease owning my place and can live a pretty comfortable life.

If worst comes to worst, there is always remote work.

~~~
gk1
I live in Baltimore, which is only a notch above Detroit in people's minds
(we're talking perceptions here...). I work remotely and can afford to live a
life I'd only dream about in Brooklyn, NY: Great apartment, great
neighborhood, and enough disposable income left over for travel and other
activities.

~~~
geogra4
The nice thing about owning a reasonably sized home is that I have a pretty
decent home office setup when I need to WFH. I can segregate it from my 'play'
area enough so I don't feel like I'm constantly on the clock.

Baltimore seems like a great place. Plus you have the advantage to ultra-
commute to DC if you need to.

------
joeyspn
50%+ of Income on rent is just ridiculous. Seems like someone needs to read
37signals' book _Remote_ :

[http://37signals.com/remote/](http://37signals.com/remote/)

Some great companies like StackExchange or GitHub read it long ago...

------
jkot
In London it is more like 80%

~~~
dijit
I was going to say something to this effect.

This figure does not surprise me in the slightest.

In London I was _easily_ paying 50% of my salary after tax in rent, because I
didn't want to share an apartment with someone else.

~~~
ionforce
So do software engineers typically live alone in London or no?

~~~
dijit
no, flatsharing (where the living room is converted into another bedroom) is
increasingly common.

------
foobar2020
This is insane. I work as a software engineer in Zurich, and I'm able to set
half of my net salary aside as soon as it arrives. Without any significant
saving efforts.

------
SeoxyS
This article can't even get basic geography right… (no, Stripe is not in Soma,
it's in the Mission). And that's just the tip of the iceberg.

~~~
joshrotenberg
And no one spells "hella" with a final h.

------
sologoub
The rent around RadPad is not that cheap. While you might be able to find
something for that price, it won't be pretty.

Most of westside is starting to be as expensive as Venice/Santa Monica and
these two aren't that different from SF in prices. Unfortunately, you don't
get much besides weather and ocean breeze, unlike in SF where public transit
and neighborhood cafes actually exist.

~~~
jsn117
They were no where near SF prices when I lived in both places last year

~~~
sologoub
That was last year :)

Friends are looking for a 2BR with $2500 budget and it's a really sad
experience. If you are willing to spend $3500, you can do much better, but
still not prime SM or Venice locations or Playa Vista (newest hotbed in the
area for tech).

The article mentions Hawthorne, but that's not the best of neighborhoods and
has a good amount of industrial/petrochemical activity near by. Redondo Beach
is still sort of affordable, but you have to deal with traffic going
north/west in the morning and back.

------
newsreader987
This is precisely the reason why I turned down an offer with a big company in
SF to work for a software company in Utah. I just graduated from school 6
months ago, but I am living very comfortably - the payment on my 4 bedroom
house is less than half of what I would have paid in SF for rent in a 2
bedroom apartment.

------
jordigg
Imagine those who don't work on tech.

~~~
intopieces
I imagine rent control comes in handy for some of those people. Then there are
the few who won the lottery and have both!

------
steven2012
Most people don't live by themselves in a 1 bedroom. They usually live 2+
people per room, so that they can afford it. For example, a 2 br apt might
have 5 people living there, two couples and then one living in the living
room. That's how they can afford the $5000/month rent.

~~~
blisterpeanuts
By "most people" you mean mostly 20-somethings? It's hard to imagine people in
their 30s and older, married and starting to have kids, living like that. I
mean, great if you can pull it off, but you'd have to stagger the shower
schedule not to mention maybe get a 2nd refrigerator?

~~~
Symbiote
That's not uncommon in London, especially amongst immigrants from Eastern
Europe — it makes sense, if the aim is to save money rapidly to put a deposit
on a house in Poland/Romania etc — and people in their 20s.

I took a room for ~9 months in what was originally a 3 bedroom house. It was
(a) very flexible regarding the contract (b) very cheap (£400/mth). (I had to
move out of my previous place, but was looking for a new job, so didn't want
to commit to something that might be in an inconvenient area.)

I had my own room, and for most of the time there were 4 people in the three
other rooms, age 30-40s and one at 50.

Everyone apart from me worked in the kind of jobs where you have to be in by
7-8am, so I never had an issue taking a shower. We had 2 fridges.

This was a "nice" house, in a nice area, with nothing dodgy about the contract
/ rent etc. In other areas there are really scummy landlords overcharging
people for individual rooms, often none of them are British / western
European, so they don't seem to know that there are regulations in their
favour, for example for getting a deposit returned, or not paying for wear-
and-tear repairs.

------
PinguTS
I don't know about the US. In Germany there is the general rule that you not
pay more than 30% of your income for rent, if you want to have decent living.
May be in the US it is different because there are diffrent costs for food.

50% and more just for living seems to be to high for me.

~~~
rco8786
Most of the U.S. 25-30% would be considered normal.

That's why the 50% figure in SF is newsworthy.

------
lobster_johnson
NYC is also expensive. Spending 50% on rent for a 2BR. (That said, I elected
to pay a little more to get a clean, modern place in a new building. A lot of
NYC apartments look like something out of 1980s Russia, only not as nice.)

~~~
aries1980
Same here in London, but for a 1BR.

------
Thaxll
So making 100k+/year doesn't allow you to live comfortably in SF nowdays?

~~~
harryh
It depends on what you mean by comfortable. It's worth pointing out that the
median income in San Francisco is $50k or so.

~~~
browseatwork
It's worse than that. Here's some 2014 data (surely it's higher now?)

[http://www.sf-
moh.org/modules/showdocument.aspx?documentid=7...](http://www.sf-
moh.org/modules/showdocument.aspx?documentid=7345)

------
d4rkph1b3r
Employees at these companies don't mind paying 50% of their salary for rent
because their salary is at most only 60% of their total compensation. Lot of
people are getting 1M + deals paid out over 4 years.

~~~
eitally
"lots of people"?

and, do you mean 4 years of salary + the equity grants, or just the equity
grants, because not very many people get $250k/yr worth of equity [from any
company]. A few do, but not the unwashed masses.

------
morkfromork
The startups I have talked to in SF don't take you seriously unless you live
there. They are real jerks about it. Tell them you live in San Jose and can
take Caltrain and they never call you back.

------
pbreit
Not only is the headline different, it's misleading or plain wrong.

------
samskeller
Yeah this is expensive, but they're talking about living right next to your
office. Of course the rents are extremely high there -- you're downtown. Kind
of a misleading article

~~~
sjg007
Rents all over SF and the bay area are expensive. SOMA within 0.5 miles is not
really the point.

------
doyoulikeworms
I don't know if this kind of comment is appreciated on HN, so I apologize in
advance.

Why is rent so high in SF and the Bay Area in general? Can anyone recommend
good reading material on this topic?

~~~
tdylan
Any econ101 book will do. I'd suggest Basic Economics by Thomas Sowell.

Short version: Supply (housing) is being artificially restrained from being
built out (through regulation). While demand (those moving to the area) keeps
increasing. Low supply and high demand = higher prices.

Solution: Build more housing.

It's a simple problem, navigating the bureaucracy is the hard part.

------
bfrog
Surely this will end well

------
tdylan
It's not a coincidence that the two cities which have the most regulation on
housing are also the two most expensive cities (SF & NY).

------
dataker
Another missing 'variable' in the cost of living is taxation. Either income or
sales taxes do add up in this calculation.

------
rdl
Is this submarine hiring post for SpaceX? They have offices in Hawthorne and
in Redmond; both are nice (Redmond is way nicer IMO).

------
iamphilrae
Or you know, if it bothers you then find a job elsewhere. A mass exodus will
help reduce rents and/or raise wages.

------
iz4e
This salary data is questionable. $160k at google is highly unlikely, unless
this counts total comp.

------
BYWallace
Maybe a good number of these people are subsidizing their rent by listing
their places on AirBnB?

------
caseyf7
I'm surprised it's only 40-50% now. That was the norm 10 years ago in SF.

------
frogpelt
Are they complaining?

------
notNow
I think it's safe to assume that the rent is too damn high for companies
relocating or setting up offices in SF. It would have been much more
insightful of they could supply that graph with office or residential space
data over time to get the full picture.

------
SovietDissident
I mean, I like LA a lot better, but I think even that is too expensive,
especially when you're getting hit with CA taxes. I moved to Tennessee. No
income tax, friendly people, fewer NIMBYs and restrictive building policy,
fewer feminist harpies, etc. Apparently many others have had the same idea,
since people are streaming into the state from places like NY and CA. You'd be
surprised how much tech is here as well. Unfortunately, winter is way worse
and there are no real beaches, but you can always buy a plane ticket.

