A household needs just $29,789 income to afford a home in Cleveland, but it takes $137,130 in San Francisco

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Wide range in the US

Texas is still relatively affordable, with Dallas, Houston, and San Antonio each requiring less than $50K household income to buy a home.

@Jon Klaus  ,

A lot more people making $150K in SF than Cleveland! Affordability is still lower, so it just remains more of a rental society in SF especially - less so around the periphery. 


@Minh L. were just talking about affordability indeces, and their impact on price. It seems like all the purchases in our area are driven by the top 10-30% of earners buying multiple properties.. The rest aren't even in the statistics because they are foreign buyers (I think I heard up to 20-30% of transactions in SF or Bay..) Whether or not people who can't afford a house make up 40% or 60% of the market, it seems like there are still plenty of buyers there, at least with this inventory.

Probably unique relative to many of the areas of the country, but curious how you read into this.. Expect prices to level off as affordability decreases? Slow in rate of growth of prices? Or do you see loan terms loosening to keep buyers in the markets, as prices and interest rates rise..?

One of the houses that I rehabbed and flipped last year - it sold to a nice young lady who worked at McDonalds.  Not a manager either.  And the house was probably on the upper-end of typical blue-collar first-time-buyer kind of houses.  Price was $119,000.

The first house I ever bought was a cute 1/1.  Needed work, but was totally livable in a small, safe desert town.  I sold it for $16.5K.  I had moved to So Cal from NYC a few years earlier.  I couldn't get over how "affordable" it was compared to what I knew.  My tiny 1BDR apt. at the time in Santa Barbara was $1K/mo  One person making minimum wage should have been able to afford that house.  2 people making above minimum wage should have been able to save money rather quickly to buy something bigger and better.  But that's not how housing affordability works.  It's all numbers on paper and doesn't reflect the true net income and/or real household expenses. Transportation is rarely figured correctly.  Even with no car payment, transportation costs in California is thousands of dollars a year.  Even with health insurance, a $2K deductible could put a family behind.

Home ownership and ALL it's associated costs and responsibilities is so much more than PITI. What low income family is actually budgeting even $150 for a plumbing repair? And where will the $4K for a new roof come from? We have new landlords on BP everyday who haven't budgeted for any repairs or unforeseen costs.

$2,500/month in Cleveland Ohio.  $2,000/month on living expenses and $500/month left for housing cost.

$11,000/month in San Francisco.  Net after tax is $7,500/month.  $2,000/month on living expenses.  $5,500/month left for housing cost, or

$4,000/month on living expenses.  $3,500/month for housing costs.  That can support a $700k house in the SFBA, and one has a better standard of living with $4,000/month to spend.  

Where would one want to live?  SF or Cleveland?  Did I get it right @Bob Bowling , @J Martin and @Jay Hinrichs ?  This reminds me of an old saying.... "Everything in life has a price."  


the people that tend to do well in the Bay Area are the ones who: A- already got on the appreciation train by having purchased a home (move up buyers) or B- move here because of high paying jobs in tech, finances, management, etc. (and can afford the prices). 

It's the existing blue collar and middle class who did not buy years ago that are priced out.  (That is the entire debate in San Francisco right now, as stringent rent control policies allows these people to hang on to low rents.  This causes all sorts of nutty distortions in the rental market here, but that's a different story.)  So more working class folks are having to move out of prime Bay Area into secondary markets like Oakland and Vallejo. That's how neighborhoods change due to market forces. But it does give pause on a social policy level. Sure, one can see expensive (but small) towns like Palo Alto or Los  Altos bereft of the working class, but the entire Peninsula?  That's like 2 million people. Hard to have a large area with 2 million people, all of them yuppies. Someone has to cook the food, wash the dishes and operate the retail stores? Of course we are not at this extreme *yet*, but if the Bay Area economy continues to hum along, in the next generation or two, we may very well be.  My gut feeling is that it will lead to "interesting" social policy, as I don't see a peoples revolution happening anytime soon :)

Originally posted by @Minh L.:
$2,500/month in Cleveland Ohio. $2,000/month on living expenses and $500/month left for housing cost.
$11,000/month in San Francisco. Net after tax is $7,500/month. $2,000/month on living expenses. $5,500/month left for housing cost, or
$4,000/month on living expenses. $3,500/month for housing costs. That can support a $700k house in the SFBA, and one has a better standard of living with $4,000/month to spend.

Where would one want to live? SF or Cleveland? Did I get it right @Bob Bowling , @J Martin and @Jay Hinrichs ? This reminds me of an old saying.... "Everything in life has a price."


You're comparing apples to oranges. A $132k job in SF does not translate equally to a $30k job in Cleveland. The latter sounds more like the salary of a Starbucks barista than a middle management professional, who might make closer to $70k here. When I was offered a position at a Big Four accounting firm, the cost-of-living adjustment between CLE and SF was only about a $10k addition.

Neither will $2000/mo in living expenses in SF buy you nearly as much as in Cleveland.

I love San Francisco and I visit very often, but I wouldn't consider living there without a large budget for totally disposable income. I'd rather invest my money.

I agree with @Christian Carson but the cost will always be hgher in more desirable areas

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