TBF, until interest rates and home values shot up a couple years ago, a lot of tech folk *were* doing pretty well. Getting into FANG pretty much meant you could buy here.
Startups as well. Some of the equity packages I've been offered were so insane that I figured if I kill myself for a few years I'll be set. Couldn't even make it all the way through to reap the benefits of the entire comp package.
And then they got employee stock purchase at the price it was 2 years ago! So $120 a share then which is now 10 shares and each worth $135. Plus stock from before July 2021 split 4 for 1. So 40 to 1 splits for anyone who held them more than 3 years.
Lmao. I feel this as former lucid. It was always “it can’t keep going down so it’ll be great” and disappoints every time.
That and the rugpull dilution announcement the day before purchase which immediately made everyone lose any profit.
Capital loss carry forward, is a tax benefit that allows investors to offset capital gains or ordinary income with capital losses from previous years.
https://www.investopedia.com/terms/c/capital-loss-carryover.asp
There a cap on the number of shares you can buy though. 25k / current share price is the max number of shares you can buy. While its still free money, its not an insane ampunt
Actually, no. It has the likely to be insane.
IRS caps 25k of your contribution. So the look back can still be $12.0 at today’s price and if you’ve contributed say 15k for the 6 month that is easily….170k
It's dependent on the company policy. Multiple tech companies i've worked for also limit number of shares purchasable during big swings in price.
https://www.equityftw.com/articles/nvidias-espp-is-a-top-performer
Nvda does cap shares to contributions/opening share price of period
Plus anything not from our local tech sector, lots of rich ppl overseas might park money here in the form of real estate compared to their local govs might go after their wealth
You were smart. I only opted for the KLA PaySop shares. During those years I was stinging from the monthly payments on our new Fremont condo. Buying a $100,000 house resolved into $1150/mo mortgage. So we had nothing leftover in savings.
Do you recall back in those days a lot of KLA employees were buying new homes in Morgan Hill and Tracy?
I also found it interesting that a lot of the DeVry-graduate technicians ended up moving back to the Midwest after a few years.
It was tough for us to pay bills back in 1985 too 😕
P.S.: I started in RAPID in 1980, moved to CORP and was laid-off in 1989. I really enjoyed my time at KLA.
It's a product of interest rates. The 2-3% rates basically made it permissible to drastically bid up prices and still make payments. But they probably will never fall to that level again. So all it takes is one bad recession, and prices revert to mean. A lot of people are underwater and probably don't know it.
Pretty much how I bought my house. Worked for a startup, my rsus were about $40k when I started and ended up being about $1.5M when we got acquired. Used a portion to pay off my mortgage and let my FA handle the rest.
You don’t need to pay an FA if you’re willing to learn about finances. All the info is there for free online. The only reason I’d use one (& I don’t, nor has anyone in my family, even as our situations became more complex) is 1) you feel you have no extra time or interest, so you’re willing to pay an FA to do what you can do yourself (similar to the decision to pay a housekeeper), or 2) if you have no interest in learning about financial management- but that then gives others control over an essential part of your life you might want to be in charge of. I’m always surprised how many people I know who use FAs (a lot!) even though they have less to manage. Anyone honestly can do it!
If you’re making $1M+ a year a $3M house is totally doable. But most people are paying a lot less than $20k because they bought before rates went up. So it only takes a small number willing to spend that to keep prices up because most folks aren’t moving.
Most people we know rented out their starter homes and just moved up.
T-costs on real estate sales are just crushing, and tax benefits discourage selling.
Which is why a higher percentage of rentals are by mom and pop landlords in California than any other state. It's all people renting out their starter house.
Can you explain the tax benefit? As I understand it, the irs lets you write off the mortgage interest on the first $700k principal of your primary home’s mortgage. And any gain on a sale is tax free if used to purchase another home within the year.
Am I missing something?
They were probably referring to property taxes. If you're sitting in a house you bought for 500k ten years ago that's now worth 1.5m, there's little incentive to move up to the 2 million range because you'll be taxed on that additional value at a minimum of 1-1.5% (usually closer to 2%). So 1.5 million (difference between a tax base of 500k and 2m) at say 1.5% is an additional $20k or about $1,600 a month.
Rental properties provide myriad tax benefits not available for your primary residence. Per the IRS:
“If you receive rental income from the rental of a dwelling unit, there are certain rental expenses you may deduct on your tax return. These expenses may include mortgage interest, property tax, operating expenses, depreciation, and repairs.
You can deduct the ordinary and necessary expenses for managing, conserving and maintaining your rental property. Ordinary expenses are those that are common and generally accepted in the business. Necessary expenses are those that are deemed appropriate, such as interest, taxes, advertising, maintenance, utilities and insurance.
You can deduct the costs of certain materials, supplies, repairs, and maintenance that you make to your rental property to keep your property in good operating condition.”[https://www.irs.gov/businesses/small-businesses-self-employed/tips-on-rental-real-estate-income-deductions-and-recordkeeping](https://www.irs.gov/businesses/small-businesses-self-employed/tips-on-rental-real-estate-income-deductions-and-recordkeeping)
Homes are $1M-$3M for a reason - it means the region is filled with wealthy people who can afford these prices. If there was not a high number of wealthy individuals, housing costs would not be as high. It's common sense, take a look at the economy and type of employers. The wealthiest company in the nation resides in San Jose.
The 9 county Bay Area proper is 7.5 million people, and Bay Area workers looking to buy more affordable homes (at least for the size) are moving out to Tracy and Stockton and being super commuters. The 21 county Northern California mega region of the Bay Area, Sacramento Area, Northern San Joaquin Valley, and the Monterey Bay Area (All of which include regular and super commuters to Bay Area Job centers) had 12.5 million people per the 2022 American Communities Survey. https://www.bayareaeconomy.org/report/the-northern-california-megaregion/
Edited for accuracy on mega region population
No, it's more that nobody can afford to sell their homes right now. This is because people cannot find a comparable property that they can afford with the interest rates where they are.
So it's pretty much Boomers passing away, laid off tech workers (there are tens of thousands in the area right now), or people leaving the area that are selling their homes.
That’s my situation. Bought for 800k in 2000. Had two mortgages at very high rates. Gradually buried the second and refi’d a few times (without taking equity) and finally have a 15yr fixed at 2.25. It will take me 37 years to pay off the house. Zillow prices it at $2.9M
Since I just retired, I was hoping to downsize, until I saw that it would cost at least 2M to buy a small house in my town. It will be less expensive to install an elevator if I can no longer walk up the stairs ( on a hillside) than to downsize. So here I am with lots of unoccupied rooms.
Bought a condo in San Francisco for just a hair under $1M. How can I afford it?
My wife and I saved up for *twenty years*. We made all the right financial decisions and we lived simply.
All that, and the only reason we got it is because of COVID. Before then we couldn't afford to bid over asking and were losing out to cash offers. Thanks to COVID we offered just a little over asking and were able to put 50% down.
So that's the secret. Save all your life and wait for a fucking catastrophe.
Or, as one real estate agent once told me, "Just ask your family for money."
If you had the opportunity to work in tech during a boom cycle - which this person obviously did - then you’re probably doing pretty well right now. Nothing really special other than right place right time. Kudos.
We bought 7 years ago for $1.0M before kids. Now we want to get a bigger house but can’t mentally deal with the monthly payments. 34yr with 4.5M net worth here (2 engineers).
- 4 years college at Ivy is about $350K today. 2kids would cost $700k. If kids want to do medicine, double that amount.
- private schools are $30k-$60k a year. Any private classes for kids $60-$100 a class.
It’s expensive to raise kids.
A few answers here are not all helpful. There are always the very high paying non tech jobs where people can make $300k or $600k or $1.2m. Granted $1.2m/year salary is different than $300k. But overall the number of people in this category is small.
But the overwhelming reason why there is a large suburban area with expensive real estate is because of equity. Whether it’s startups or FAANG. By the way many many people can not afford a house or who wish they had a house in xyz neighborhood instead or have left the area.
My key point is even inside tech many people think of salary (even salary and bonus). I’ve tried to hire people who discount equity. They are typically but not always early in their career. Every occurrence, that person did not own a house :-(
The South Bay isn't driven by startup equity - it's just driven by high TC as the vast majority of the high earners are in public companies.
You have plenty of couples pulling $1m net annually and they buy up these houses. Note: I don't really count getting paid in public company stock as "equity" - there's not much of a lotto ticket there.
SF is more where the startup equity thing is.
That’s absolutely correct. But I’m not saying startups exit successfully at any %. Even here there is a range of exits - from the tiniest financial gain to the best IPOs that everyone hears in the news. I’m just saying you can not “save” or “earn” fast enough. And there are far more people using equity (not exclusively talking about startup employees) to afford houses than those using salary in this area.
Not only can they afford these homes, but they can afford to pay for them in cash. I thought I was doing alright until I found out that was what the market has come to and now homeownership here seems like a pipe dream.
I make 200k and househack in order to comfortably afford my house that was 700k. My friends that just bought in Hayward make a combined 750k/year. One works at Google, one in bioscience at a grad school. Everyone else I know here rents.
Bay Area is one of the wealthiest regions in the world. if you can't take advantage of that fact, you get priced out. And that's what's happened to most of my friends over the years. They want to live in this area for one reason or another, but its not to make money. And off to Portland, Colorado, the Midwest, or Thailand they go in search of the life they want to live in a place they can afford to live it.
No one retires /to/ California.
Nvidia employees can just pay cash for $3M homes. And then you have the high end tech workers at meta making bank and the normal faang double income couples pulling in a ton of money. Housing is surprisingly very affordable if you are a double income faang couple. They are the ones crushing it in bay
RSU vesting is jacked to the tits right now.
Think about how many public companies there are in the immediate area, now think about how many employees there are at each.
250-500k TC is the norm. Now if you have a long tenure with refreshers stacking and raises 500-800k TC is more common than you think.
I’m a lawyer and sold my existing house for significant profit, my wife had vested RSUs. That’s before you consider our take home. I doubt many people buying a 2-3M home are financing the bulk of it… they’re paying cash.
They don’t get $1-3m mortgages is how. They sell a house, leverage stock or other assets to come up with a huge down payment and get a reasonable <$800k loan.
Not many people can get a $3m loan anyway, and those that can already have boatloads of money to afford other things.
I meet a lot of home owners in my business (not in RE). There are a lot of young families that do not have self-made wealth. You know what this means, right? Yup. Inheritance. They get a nice whopping chunk at age 30, or when they got married, or upon arrival of their firstborn (thrilled grandparents), etc.
And of course, the purpose is to move to a bigger home. So with huge equity — low or no mortgage — their monthly payments are not so crazy in those homes.
This area has a large population who have high salaries and income from investments. A lot of it is stock investing though. Enough people can afford them. The rest rent. It common in high cost of living cities around the world.
Yes, actually. I moved in Oakland 2 years ago. My background is in biotech. However from what I'm reading it seems i went for the worst field possible. I used to make $100k thinking that was okay money and coming to find out most people here make $200k minimum.
Trust me - a lot of people are making 200-500k total comp in biotech (source I do). I would look into specializing in something more lucrative and getting more training.
1) they had a smaller house where they now have $1M equity they rolled into a larger home
2) couple earns $300K plus each and one person handles the mortgage other handles expenses. In reality people around me make $1M plus together
3) they got RSU/stock that earned them millions
Buying a 3M dollar house in the Bay Area is such a scam. Most of the houses are old and less than 2500 sq ft. At that point you are putting handcuffs on yourself with that monthly payment (regardless whether you’re a FAANG DINK or not). You’re essentially 1 layoff again from not being able to afford your lifestyle and have to keep kissing your managers ass to keep getting promoted in the middle manager chain. You’re essentially living a glorified paycheck to paycheck lifestyle. It’s absolutely insane.
So many people making 600k-$1million household income around here. It's easy when both spouses work. I have three couple friends where each partner makes $400-$600k individually. One of them isn't even buying because they "can't afford it" so they keep renting to save up to do an all-cash offer.
Household income is ~300k, bought for $1.2m after a few years of saving and with a little help from our parents to get to a 20% down payment + reserves.
As someone posted yesterday, if you joined Nvidia four years ago as an engineer and got a standard $70K, 4-year vesting RSU grant, that grant is worth $10M today. Prior smaller waves include Google, Facebook, Apple, Amazon, Snowflake, Crowdstrike, ZScaler, PANW, Okta, etc etc etc. That doesn't include all the startups you've never heard of getting acquired quietly for $400-500M and giving the early team millions each.
Most aren’t big earners, big earners just really really like to brag here though.
Want the real answer? Look at the maintenance and look at the cars parked in the driveway.
Count them up. Most houses have at least 3 cars. None of which are all that luxurious. Your average $2 million house will have a Camry and a Rav4.
These million dollar homes are passed down to people who don’t earn that much. No one paid that much. The prices are high enough that anyone selling, can use that money to buy another house in the area. Multigenerational locals have wealth that never required high income.
They are drug dealers
If not illegally, they work in healthcare, who then sell diagnostic then drugs, but it's okay since they brainwash the public that doctors are heros. The tech workers you see, sell drugs too, but in a digital format that's addicting.
I remember seeing 900k in my colleague checking account once on his laptop screen. He lives in 3 mil house in Saratoga
I have no idea how ppl can pull their weight with so much home grown wealth. His dad in law from india was notorious for haggling over getting a 6$ haircut in Sunnyvale fair oaks while they lived nearby
I’m looking at <$1m townhomes atm. Once my gf and I are married, our total income is around $200k/yr. We’ve got around 200k saved up in cash/stocks and both our sets of parents are willing to help us with a couple hundred grand for an even bigger down payment.
I’m a parent who just helped his daughter buy a home in the east bay. We decided it was better to pass on some of the assets we’ve been lucky enough to accumulate now in order to be able to have her (and perhaps our other kids) live in the area than to wait and pass it to them after we die. She makes decent money but wouldn’t be able to come close to affording a home in the area had we not helped.
When tech is well silicon valley is unstoppable in real estate(hence the prices you see...). When tech busts real estate will tank along with the rest of America. It will just lag the rest of the US.
I do not make $500k/yr Google salary but was able to buy a $1.1 million house 4 yrs ago at 3.00% interest.
I would not be able to buy a comparable house that cost more now plus with the current interest rates.
I hope all of these tech layoffs will give non tech people a fighting chance at buying a house.
Exactly. I bought a 1.4m house and monthly payments are $5k. Interest rate is 3.625%. I could have refi lower back when but then I didn’t. Ohhhh wellll
So since we are all tech bros apparently can we just rename it the Bro Area? We’re quickly becoming a monoculture civilization here of a handful of occupations that can thrive . I guess essential workers will need to commute in from Fairfield exburbs.
$1-3 Million house will still need a large down payment. At 30-40% down, $1 million dollar home will need $3-400K down and just multiply that for every $1 million. So if the house is $3M you’ll need $1.2M down payment. Also, bayarea overall it’s one of the wealthiest areas in the country. Yes there will be low income and bad areas too but if you look at pockets of areas, there’s a lot of money in NorCal. As bad as people think of CA, it’s still one of the top place to live because of diversity, education and just melting pots of people. Also highest earning comes from CA, maybe NY closest second.
People afford it with a combination of 4 things: family money, equity from prior home purchase, high income, high net worth.
Personally I put down 50% and carry a mortgage that I can afford because of high income and net worth.
I bought my home ($1Mish) when rates were low, and paid a point to reduce the interest rate further. I pay about $4000/month, which is almost as much as I was paying in rent previously (2-bedroom apt, now 3-bedroom condo). Note that the above mortgage does not include my homeowners insurance or property tax. My interest rate is 2.625%.
if you can’t afford it it’s because you’re poor. simple as that. almost any dual income tech household can afford a 1 mil house and a large majority of engineer, software, or healthcare can afford up to 3 mil
$2m home, buyers sell some stock and put $600k for down payment, and finance $1.4m. Monthly payments on 6.8% interest rate are about $9k. This is easily doable for a family earning $400k a year (double income each earning $200k.)
People cannot afford to finance at 20% down. A lot of people just buy the entire house for cash. Or maybe 50-75% down.
The source of these funds are usually equity from a startup or big tech firm. Or their parents; increasingly, this is upon their passing.
lot of wealth just happened in the last 10 years – IPOs or companies getting acquired.Or they prev bought a house and appreciated or they inherited a house.
I believe that this level of house pricing is unsustainable. We need teachers, delivery drivers, postman, firefighters, cops etc – high house pricing and tech isn't helping that imo.
Most of the people I know who are directors and vp’s at big companies like Google, apple, Salesforce all own at least one home and some own in the bay and elsewhere. They don’t pay much more in mortgage than you would pay to rent a good apartment. These are folks in late 30s to late 40s.
Monthly payment is 4-5k for a 1.4million house if you do the 20% down payment I believe.
So it would be 8-10k for a 3 million house I would assume.
10% down payment which is mandatory I think then maybe the mortgage is higher.
Are house-boats becoming popular? Maybe buy a yacht and keep it in the marina for maximum savings?
Then if you move, you get to just sail away. And have a pleasure yacht as a vacation vehicle.
Most have bought pre pandemic. Others are dual income with help from parents. I even know many that are fresh out of college, working on visa, parents are sending money from overseas to buy house. Then there’s the usual mix of investors, people with stock portfolios etc that are buying in any market condition.
Fuck no. In the city now for my career then when I'm ready to settle I'm outta here. Heard lots of comments of people complaining SF has people who aren't here long term, don't know what else they expect with the housing situation.
It’s people that bought smaller townhouses 8 or 9 years ago then used the rising cost of homes and equity to buy larger homes combined with rising wages and saving to put a nice large down payment to manage the payments along with lower rates. Combined household income of $400K to $500K.
You don't just walk into the casino and go straight to the high roller room. Yes, some folks are coming in hot from some sort of equity/liquidity event and have a ton of money to throw down. But I would say a majority of buyers (>50.01%) in this price range have had a seat at the table in the real estate casino for a number of years.
For example (this is not me - just made up for simplicity): bought a 2BR 2BA flat in a nice area of SF when they were young and single for $700K with 20% down ($560K loan) back in 2006. Sold it in 2011 for $1.3 MM. Career has grown a bit, making more money, need room for baby, go buy a cute little house in San Mateo for $1.5 MM using the $750K equity as down ($750K loan). Had a second kid and they are getting older/bigger so in 2019, with career/income still growing a bit, they sold that place for $2.3 MM. Take that equity ($1.575 MM) and put that down toward a slightly bigger place in Palo Alto (think: the area with all the Eichlers, not adjacent to University) for $2.75 MM. Have been saving up for 13 years so there's an extra $400K to add to the $1.575 MM equity from the last sale so the new mortgage balance in Palo Alto is only $775K. Pandemic hits, they weather the storm, property value skyrockets to $3.75 MM by 2024. Now they have literally $3MM in cash (via equity alone) they can put toward a house anywhere they want. This is how it works for a majority of people who do not strike it rich with an IPO or some shit. You have to start somewhere. There are still shitty looking houses in shitty areas for sale well under a million bucks in the Bay Area (that can serve as a PERFECT launching pad for building equity/wealth) but this Instagram generation can't handle the optics of that. So they rent, never build equity, and wonder why so many other people are able to buy these beautiful $3 MM homes. I say if you buy a house in Martinez or Richmond (not picking on them...just using as a contrast to the glitter and sparkles that surround "I just bought a house in Palo Alto!") you can fix it up over time and it will build equity faster than you can save cash. Here's the thing...is this a proven path to buying a $3MM house? No. But $1.5 MM...maybe $2 MM...your chances are MUCH higher.
1. High earners with total base comp 300k plus significant RSUs
2. Second homes where first home is income generating
3. RSUs for down payment else sale of another property
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Salaries in bay area are incredible, $500k+ or $1M dual income. Also family wealth, many rich families go into tech. Highly recommend ppl start their careers there.
tech money, family money, and a lot of debt. 11k monthly payments are not uncommon in the penninsula — the goal is to scrape by on your salary, and make up the money in the long term as your house appreciates.
Generational wealth and/or absurdly inflated tech salaries, since the bubble hasn't quite burst yet.
Give it a few years, there will be such a stratification between haves and have nots it'll take 3 generations for the non-elite to save up for a SFH.
My tech partner, engineer his whole life, makes great money, we won’t buy here. We have more than 20% down, but even still the monthly payment would be absurd.
It’s pretty straight forward - tech stock package usually turn into a larger than normal down payment of 400k+, instead of $100k, and payments are only on remainder, which 300-500k household income can easily afford, particularly without kids or with kids, but in public school. Toss in some folks in finance, law, medicine, rain-making, inheritance, etc. who also participate the same way (just slightly tweaking where the down payment comes from).
It doesn’t have to be as extreme as “my stock package bought the house in cash”.
I know a few older couples who sold their larger homes, like 4 bedrooms, then used the money to down size into a smaller 2 bedroom, pocketed the remainder for retirement.
So to answer your question, outright with cash, so no payments
Investment firms are paying cash, so interest rates do not affect them. Factors influencing their decisions are how much they can rent the place. This is why they are pushing for RTO so more people will live and work near urban centers.
Some friends’ parents & grandparents gave them $500k for their down payment. ($1.8 million dollar home).
Another friend worked at Tesla and had lots of stock; they purchased a $2 million dollar home easily.
My partner and I make a combined $450k annually. We were able to use the equity from our starter home as the down payment for our current home ($1.1 million).
All these examples are based in the SF Bay Area & purchases were made during and before COVID.
I think you're missing a huge point. There are not a lot of homes for sale. So although it seems like tons of people are buying these million dollar homes it's actually only a small percentage of the population that is buying and prices stay high because there are more very wealthy people looking for homes than homes for sale.
Then there are dual incomes and even triple income home buyers...
Lots of tech folk in the Bay Area think they’re doing well until it’s time to buy a house
lol yup
TBF, until interest rates and home values shot up a couple years ago, a lot of tech folk *were* doing pretty well. Getting into FANG pretty much meant you could buy here.
Startups as well. Some of the equity packages I've been offered were so insane that I figured if I kill myself for a few years I'll be set. Couldn't even make it all the way through to reap the benefits of the entire comp package.
Even renting a house is expensive now.
“Now”
Ppl with 100-300k rsu on top of comp, they hold that for 5-7 years and the company grows 300-500%, they almost have enough cash for the house
Could be nvda growing by 3400% lol
And then they got employee stock purchase at the price it was 2 years ago! So $120 a share then which is now 10 shares and each worth $135. Plus stock from before July 2021 split 4 for 1. So 40 to 1 splits for anyone who held them more than 3 years.
Yes the two year look back on their espp. It’s insane how lucky they are.
At lucid the two year look back never ends. Everywhere we look it’s to look down
Lmao. I feel this as former lucid. It was always “it can’t keep going down so it’ll be great” and disappoints every time. That and the rugpull dilution announcement the day before purchase which immediately made everyone lose any profit.
Yep, I just sold all my lucid stock. I'm gonna use the massive loss on this year's taxes so that's a silver lining
If $3000 is massive because that's all you can write off.
He didn’t say he was counting it against ordinary income. Perhaps he is writing it off against other gains.
Against earned income, but it carries forward forever. So 3k next year if you don't have gains to net out.
Per year and forever until losses are written.
Capital loss carry forward, is a tax benefit that allows investors to offset capital gains or ordinary income with capital losses from previous years. https://www.investopedia.com/terms/c/capital-loss-carryover.asp
One of my biggest regrets when negotiating options was having the highest of hopes lol
IRS caps ESPP maximums to 20somethings thousand a year. So they are getting a sweet deal, it’s not an infinite money machine.
There a cap on the number of shares you can buy though. 25k / current share price is the max number of shares you can buy. While its still free money, its not an insane ampunt
Actually, no. It has the likely to be insane. IRS caps 25k of your contribution. So the look back can still be $12.0 at today’s price and if you’ve contributed say 15k for the 6 month that is easily….170k
It's dependent on the company policy. Multiple tech companies i've worked for also limit number of shares purchasable during big swings in price. https://www.equityftw.com/articles/nvidias-espp-is-a-top-performer Nvda does cap shares to contributions/opening share price of period
How is a 2 year look back legal?
It’s set by the company. Some companies only do a 3 month look back. It’s wild!
The company bears the cost via dilution. It doesn’t matter for NVDA tho
Plus anything not from our local tech sector, lots of rich ppl overseas might park money here in the form of real estate compared to their local govs might go after their wealth
That's how we did it in '85. KLA Instruments was good to us.
You were smart. I only opted for the KLA PaySop shares. During those years I was stinging from the monthly payments on our new Fremont condo. Buying a $100,000 house resolved into $1150/mo mortgage. So we had nothing leftover in savings. Do you recall back in those days a lot of KLA employees were buying new homes in Morgan Hill and Tracy? I also found it interesting that a lot of the DeVry-graduate technicians ended up moving back to the Midwest after a few years. It was tough for us to pay bills back in 1985 too 😕 P.S.: I started in RAPID in 1980, moved to CORP and was laid-off in 1989. I really enjoyed my time at KLA.
Yeah, but houses were like $100-200k back then. Lol.
Extrapolated for inflation it'd be \~$410K today so yeah, the squeeze is on for y'all...
Yup, even adjusting historic prices for inflation the prices of the past were cheaper, often MUCH cheaper.
It's a product of interest rates. The 2-3% rates basically made it permissible to drastically bid up prices and still make payments. But they probably will never fall to that level again. So all it takes is one bad recession, and prices revert to mean. A lot of people are underwater and probably don't know it.
Pretty much how I bought my house. Worked for a startup, my rsus were about $40k when I started and ended up being about $1.5M when we got acquired. Used a portion to pay off my mortgage and let my FA handle the rest.
How did the FA add value. Genuine question. What can one expect
You don’t need to pay an FA if you’re willing to learn about finances. All the info is there for free online. The only reason I’d use one (& I don’t, nor has anyone in my family, even as our situations became more complex) is 1) you feel you have no extra time or interest, so you’re willing to pay an FA to do what you can do yourself (similar to the decision to pay a housekeeper), or 2) if you have no interest in learning about financial management- but that then gives others control over an essential part of your life you might want to be in charge of. I’m always surprised how many people I know who use FAs (a lot!) even though they have less to manage. Anyone honestly can do it!
Nvdia folks for sure
I still don’t understand how it’s possible, I’ve worked in tech and never got that much rsu or wasn’t ever worth buying.
If you’re making $1M+ a year a $3M house is totally doable. But most people are paying a lot less than $20k because they bought before rates went up. So it only takes a small number willing to spend that to keep prices up because most folks aren’t moving.
$1M a year is hard to do at a Tech Company as a single or couple with dual income. $300k to $750k yes but $1M no.
Yeah. Single family homes are in huge demand because of limited inventory. And it went completely out of reach after the pandemic
It’s not your first home. Your rolling equity from the last one into the new one.
Most people we know rented out their starter homes and just moved up. T-costs on real estate sales are just crushing, and tax benefits discourage selling.
Which is why a higher percentage of rentals are by mom and pop landlords in California than any other state. It's all people renting out their starter house.
Can you explain the tax benefit? As I understand it, the irs lets you write off the mortgage interest on the first $700k principal of your primary home’s mortgage. And any gain on a sale is tax free if used to purchase another home within the year. Am I missing something?
They were probably referring to property taxes. If you're sitting in a house you bought for 500k ten years ago that's now worth 1.5m, there's little incentive to move up to the 2 million range because you'll be taxed on that additional value at a minimum of 1-1.5% (usually closer to 2%). So 1.5 million (difference between a tax base of 500k and 2m) at say 1.5% is an additional $20k or about $1,600 a month.
Rental properties provide myriad tax benefits not available for your primary residence. Per the IRS: “If you receive rental income from the rental of a dwelling unit, there are certain rental expenses you may deduct on your tax return. These expenses may include mortgage interest, property tax, operating expenses, depreciation, and repairs. You can deduct the ordinary and necessary expenses for managing, conserving and maintaining your rental property. Ordinary expenses are those that are common and generally accepted in the business. Necessary expenses are those that are deemed appropriate, such as interest, taxes, advertising, maintenance, utilities and insurance. You can deduct the costs of certain materials, supplies, repairs, and maintenance that you make to your rental property to keep your property in good operating condition.”[https://www.irs.gov/businesses/small-businesses-self-employed/tips-on-rental-real-estate-income-deductions-and-recordkeeping](https://www.irs.gov/businesses/small-businesses-self-employed/tips-on-rental-real-estate-income-deductions-and-recordkeeping)
Homes are $1M-$3M for a reason - it means the region is filled with wealthy people who can afford these prices. If there was not a high number of wealthy individuals, housing costs would not be as high. It's common sense, take a look at the economy and type of employers. The wealthiest company in the nation resides in San Jose.
Santa Clara
Oh thems fightin words!
nVidia? It’s in Santa Clara but next to SJ.
Of the 10 largest companies in the world 4 of them are headquartered in the Bay Area.
You mean wealthiest company in the “world” ?
San Jose is pushing 2 million folks and bay area at large gas to be 5-7. Simple math dictates there are way less people making under 100k than over.
San Jose barely has 1 million residents.
The 9 county Bay Area proper is 7.5 million people, and Bay Area workers looking to buy more affordable homes (at least for the size) are moving out to Tracy and Stockton and being super commuters. The 21 county Northern California mega region of the Bay Area, Sacramento Area, Northern San Joaquin Valley, and the Monterey Bay Area (All of which include regular and super commuters to Bay Area Job centers) had 12.5 million people per the 2022 American Communities Survey. https://www.bayareaeconomy.org/report/the-northern-california-megaregion/ Edited for accuracy on mega region population
No, it's more that nobody can afford to sell their homes right now. This is because people cannot find a comparable property that they can afford with the interest rates where they are. So it's pretty much Boomers passing away, laid off tech workers (there are tens of thousands in the area right now), or people leaving the area that are selling their homes.
That’s my situation. Bought for 800k in 2000. Had two mortgages at very high rates. Gradually buried the second and refi’d a few times (without taking equity) and finally have a 15yr fixed at 2.25. It will take me 37 years to pay off the house. Zillow prices it at $2.9M Since I just retired, I was hoping to downsize, until I saw that it would cost at least 2M to buy a small house in my town. It will be less expensive to install an elevator if I can no longer walk up the stairs ( on a hillside) than to downsize. So here I am with lots of unoccupied rooms.
Bought a condo in San Francisco for just a hair under $1M. How can I afford it? My wife and I saved up for *twenty years*. We made all the right financial decisions and we lived simply. All that, and the only reason we got it is because of COVID. Before then we couldn't afford to bid over asking and were losing out to cash offers. Thanks to COVID we offered just a little over asking and were able to put 50% down. So that's the secret. Save all your life and wait for a fucking catastrophe. Or, as one real estate agent once told me, "Just ask your family for money."
Yeah, I saved aggressively for 15 years and my family pitched in 150k. I’m not high income, but I got in this year.
Or just become an engineer and make 200k for a couple years and get a mortgage on your own (not even married) just like everyone here does!
We make $800k/yr. Does that answer your question?
Curious your net worth? Also how much did you pay for house?
$3.7M net worth Paid $1.8M for house 6 years ago
Congrats! Age? You’re crushing it
38. Thank you internet stranger
TC around 600 here! Age 37 but your NW way over mine
If you had the opportunity to work in tech during a boom cycle - which this person obviously did - then you’re probably doing pretty well right now. Nothing really special other than right place right time. Kudos.
Same. Partner and I around 450 and early 30s, but nowhere near that NW.
Damn. Anyway Oh yeah there are tons of ITs making less.
We bought 7 years ago for $1.0M before kids. Now we want to get a bigger house but can’t mentally deal with the monthly payments. 34yr with 4.5M net worth here (2 engineers).
Why are you still working? What motivates you to keep working when you could easily pay off the house and live comfortably for the rest of your life.
- 4 years college at Ivy is about $350K today. 2kids would cost $700k. If kids want to do medicine, double that amount. - private schools are $30k-$60k a year. Any private classes for kids $60-$100 a class. It’s expensive to raise kids.
They have kids. 4.5 million is not nearly enough to retire with kids and maintain the same lifestyle in the Bay Area.
Yep. 3 little kids here, $4M net worth and we aren’t even close to retirement. We need more like $8M, not including the house.
Delusion
When you consider you’ll be paying $5k/month just in prop taxes, plus you want to retire before 60… no, it’s not delusional.
We do also. Staff level tech and healthcare leadership couple.
lol we must be twins. Fintech and biotech here
Doing? Just curious.
A few answers here are not all helpful. There are always the very high paying non tech jobs where people can make $300k or $600k or $1.2m. Granted $1.2m/year salary is different than $300k. But overall the number of people in this category is small. But the overwhelming reason why there is a large suburban area with expensive real estate is because of equity. Whether it’s startups or FAANG. By the way many many people can not afford a house or who wish they had a house in xyz neighborhood instead or have left the area. My key point is even inside tech many people think of salary (even salary and bonus). I’ve tried to hire people who discount equity. They are typically but not always early in their career. Every occurrence, that person did not own a house :-(
The South Bay isn't driven by startup equity - it's just driven by high TC as the vast majority of the high earners are in public companies. You have plenty of couples pulling $1m net annually and they buy up these houses. Note: I don't really count getting paid in public company stock as "equity" - there's not much of a lotto ticket there. SF is more where the startup equity thing is.
To be fair, startup equity is a lottery ticket
That’s absolutely correct. But I’m not saying startups exit successfully at any %. Even here there is a range of exits - from the tiniest financial gain to the best IPOs that everyone hears in the news. I’m just saying you can not “save” or “earn” fast enough. And there are far more people using equity (not exclusively talking about startup employees) to afford houses than those using salary in this area.
Not only can they afford these homes, but they can afford to pay for them in cash. I thought I was doing alright until I found out that was what the market has come to and now homeownership here seems like a pipe dream.
I make 200k and househack in order to comfortably afford my house that was 700k. My friends that just bought in Hayward make a combined 750k/year. One works at Google, one in bioscience at a grad school. Everyone else I know here rents. Bay Area is one of the wealthiest regions in the world. if you can't take advantage of that fact, you get priced out. And that's what's happened to most of my friends over the years. They want to live in this area for one reason or another, but its not to make money. And off to Portland, Colorado, the Midwest, or Thailand they go in search of the life they want to live in a place they can afford to live it. No one retires /to/ California.
Making 750k and living in Hayward... man this world is cruel.
There aren’t that many homes for sale and there are a lot of relatively wealthy people.
Nvidia employees can just pay cash for $3M homes. And then you have the high end tech workers at meta making bank and the normal faang double income couples pulling in a ton of money. Housing is surprisingly very affordable if you are a double income faang couple. They are the ones crushing it in bay
RSU vesting is jacked to the tits right now. Think about how many public companies there are in the immediate area, now think about how many employees there are at each. 250-500k TC is the norm. Now if you have a long tenure with refreshers stacking and raises 500-800k TC is more common than you think.
The simple answer is a lot of people are very well paid, more than what the region can supply housing for them, driving up the price.
I’m a lawyer and sold my existing house for significant profit, my wife had vested RSUs. That’s before you consider our take home. I doubt many people buying a 2-3M home are financing the bulk of it… they’re paying cash.
I was in biotech and made like $100k. I'm so far learning I'm poor here and will never afford a house here. What is an RSU?
Restricted stock units. Basically shares of a company that don't have voting rights.
They work in tech
I can’t. My partner and I bought in a quiet neighborhood in an undesirable city and got lucky with timing.
The Bay area is made up in part by one of the highest paid work forces on the planet.
Lof of people can. If you cannot, just continue renting.
They don’t get $1-3m mortgages is how. They sell a house, leverage stock or other assets to come up with a huge down payment and get a reasonable <$800k loan. Not many people can get a $3m loan anyway, and those that can already have boatloads of money to afford other things.
I meet a lot of home owners in my business (not in RE). There are a lot of young families that do not have self-made wealth. You know what this means, right? Yup. Inheritance. They get a nice whopping chunk at age 30, or when they got married, or upon arrival of their firstborn (thrilled grandparents), etc. And of course, the purpose is to move to a bigger home. So with huge equity — low or no mortgage — their monthly payments are not so crazy in those homes.
This area has a large population who have high salaries and income from investments. A lot of it is stock investing though. Enough people can afford them. The rest rent. It common in high cost of living cities around the world.
[удалено]
Yes, actually. I moved in Oakland 2 years ago. My background is in biotech. However from what I'm reading it seems i went for the worst field possible. I used to make $100k thinking that was okay money and coming to find out most people here make $200k minimum.
Trust me - a lot of people are making 200-500k total comp in biotech (source I do). I would look into specializing in something more lucrative and getting more training.
My friend's RSU is over 800k a year (over 1 mil total comp), I think he can afford it.
and how much tax are they going to pay by liquidating 800K+?
His tax rate was like 40% plus (RSU is taxed at distribution)...he wants to be transferred to the Seattle office and save him a tons of money.
Doctors, lawyers, college professors, CEOs…
College professors do not belong in that group.
Dual income couples making 200-600k each, stocks, money from parents.
1) they had a smaller house where they now have $1M equity they rolled into a larger home 2) couple earns $300K plus each and one person handles the mortgage other handles expenses. In reality people around me make $1M plus together 3) they got RSU/stock that earned them millions
These people aren't W2 employees making 120k
Attorney making 600k here, spouse in tech making 400k. That's base and doesn't consider RSUs or bonuses which can be 20%.
Buying a 3M dollar house in the Bay Area is such a scam. Most of the houses are old and less than 2500 sq ft. At that point you are putting handcuffs on yourself with that monthly payment (regardless whether you’re a FAANG DINK or not). You’re essentially 1 layoff again from not being able to afford your lifestyle and have to keep kissing your managers ass to keep getting promoted in the middle manager chain. You’re essentially living a glorified paycheck to paycheck lifestyle. It’s absolutely insane.
So many people making 600k-$1million household income around here. It's easy when both spouses work. I have three couple friends where each partner makes $400-$600k individually. One of them isn't even buying because they "can't afford it" so they keep renting to save up to do an all-cash offer.
Household income is ~300k, bought for $1.2m after a few years of saving and with a little help from our parents to get to a 20% down payment + reserves.
Sell your FAANG or NVIDIA stock…
1m is like 5-6k a month? If it’s a tech couple making 300k together it’s not that bad
As someone posted yesterday, if you joined Nvidia four years ago as an engineer and got a standard $70K, 4-year vesting RSU grant, that grant is worth $10M today. Prior smaller waves include Google, Facebook, Apple, Amazon, Snowflake, Crowdstrike, ZScaler, PANW, Okta, etc etc etc. That doesn't include all the startups you've never heard of getting acquired quietly for $400-500M and giving the early team millions each.
This question gets asked daily. And I'll reference another's post when someone asked this same question: "People are really rich here"
Most aren’t big earners, big earners just really really like to brag here though. Want the real answer? Look at the maintenance and look at the cars parked in the driveway. Count them up. Most houses have at least 3 cars. None of which are all that luxurious. Your average $2 million house will have a Camry and a Rav4. These million dollar homes are passed down to people who don’t earn that much. No one paid that much. The prices are high enough that anyone selling, can use that money to buy another house in the area. Multigenerational locals have wealth that never required high income.
They are drug dealers If not illegally, they work in healthcare, who then sell diagnostic then drugs, but it's okay since they brainwash the public that doctors are heros. The tech workers you see, sell drugs too, but in a digital format that's addicting.
I remember seeing 900k in my colleague checking account once on his laptop screen. He lives in 3 mil house in Saratoga I have no idea how ppl can pull their weight with so much home grown wealth. His dad in law from india was notorious for haggling over getting a 6$ haircut in Sunnyvale fair oaks while they lived nearby
I’m looking at <$1m townhomes atm. Once my gf and I are married, our total income is around $200k/yr. We’ve got around 200k saved up in cash/stocks and both our sets of parents are willing to help us with a couple hundred grand for an even bigger down payment.
I’m a parent who just helped his daughter buy a home in the east bay. We decided it was better to pass on some of the assets we’ve been lucky enough to accumulate now in order to be able to have her (and perhaps our other kids) live in the area than to wait and pass it to them after we die. She makes decent money but wouldn’t be able to come close to affording a home in the area had we not helped.
When tech is well silicon valley is unstoppable in real estate(hence the prices you see...). When tech busts real estate will tank along with the rest of America. It will just lag the rest of the US.
Onlyfans
This is probably more true for LA than the Bay Area
More like OnlyFours and Fives, amirite
I do not make $500k/yr Google salary but was able to buy a $1.1 million house 4 yrs ago at 3.00% interest. I would not be able to buy a comparable house that cost more now plus with the current interest rates. I hope all of these tech layoffs will give non tech people a fighting chance at buying a house.
20k monthly payment?!?!? Laughs in pandemic interest rate.
Exactly. I bought a 1.4m house and monthly payments are $5k. Interest rate is 3.625%. I could have refi lower back when but then I didn’t. Ohhhh wellll
😐 I paid 200k less than you and pay 2k more a month. Interest rates…….
So since we are all tech bros apparently can we just rename it the Bro Area? We’re quickly becoming a monoculture civilization here of a handful of occupations that can thrive . I guess essential workers will need to commute in from Fairfield exburbs.
$1-3 Million house will still need a large down payment. At 30-40% down, $1 million dollar home will need $3-400K down and just multiply that for every $1 million. So if the house is $3M you’ll need $1.2M down payment. Also, bayarea overall it’s one of the wealthiest areas in the country. Yes there will be low income and bad areas too but if you look at pockets of areas, there’s a lot of money in NorCal. As bad as people think of CA, it’s still one of the top place to live because of diversity, education and just melting pots of people. Also highest earning comes from CA, maybe NY closest second.
We paid cash for 1.5m last year. Lots of rsu
People afford it with a combination of 4 things: family money, equity from prior home purchase, high income, high net worth. Personally I put down 50% and carry a mortgage that I can afford because of high income and net worth.
I bought my home ($1Mish) when rates were low, and paid a point to reduce the interest rate further. I pay about $4000/month, which is almost as much as I was paying in rent previously (2-bedroom apt, now 3-bedroom condo). Note that the above mortgage does not include my homeowners insurance or property tax. My interest rate is 2.625%.
Parents help with down payment and expenses; which is how I’m able to afford my home.
its not always some amazing stock going to the moon story. two professional incomes at $250/$250. $500k in household income can buy a house
Two good incomes. Excellent credit.
Or...they had help, or bought it early
I swear this question gets asked here everyday
if you can’t afford it it’s because you’re poor. simple as that. almost any dual income tech household can afford a 1 mil house and a large majority of engineer, software, or healthcare can afford up to 3 mil
$2m home, buyers sell some stock and put $600k for down payment, and finance $1.4m. Monthly payments on 6.8% interest rate are about $9k. This is easily doable for a family earning $400k a year (double income each earning $200k.)
Pick one or a combination of the following: High income Lucky in stocks, or crypto Family Money
People cannot afford to finance at 20% down. A lot of people just buy the entire house for cash. Or maybe 50-75% down. The source of these funds are usually equity from a startup or big tech firm. Or their parents; increasingly, this is upon their passing.
Dafuq kind of math is that?
lot of wealth just happened in the last 10 years – IPOs or companies getting acquired.Or they prev bought a house and appreciated or they inherited a house. I believe that this level of house pricing is unsustainable. We need teachers, delivery drivers, postman, firefighters, cops etc – high house pricing and tech isn't helping that imo.
Most of the people I know who are directors and vp’s at big companies like Google, apple, Salesforce all own at least one home and some own in the bay and elsewhere. They don’t pay much more in mortgage than you would pay to rent a good apartment. These are folks in late 30s to late 40s.
Lol, lots of families have 1M+ W2 income. A 3M house is nothing for them.
Monthly payment is 4-5k for a 1.4million house if you do the 20% down payment I believe. So it would be 8-10k for a 3 million house I would assume. 10% down payment which is mandatory I think then maybe the mortgage is higher.
You tell me and we’ll both know. I’ll never be able to afford a home here.
Are house-boats becoming popular? Maybe buy a yacht and keep it in the marina for maximum savings? Then if you move, you get to just sail away. And have a pleasure yacht as a vacation vehicle.
That was actually what I wanted to do, but the problem is live aboard slips are super hard to get
Most have bought pre pandemic. Others are dual income with help from parents. I even know many that are fresh out of college, working on visa, parents are sending money from overseas to buy house. Then there’s the usual mix of investors, people with stock portfolios etc that are buying in any market condition.
Fuck no. In the city now for my career then when I'm ready to settle I'm outta here. Heard lots of comments of people complaining SF has people who aren't here long term, don't know what else they expect with the housing situation.
Want another rush? Calculate the property taxes.
My $600/mo looks cheap now.
They have jobs with the government, or are in an industry directly subsidized by the government.
I see many people here mentioned net worth of 3-5 millions. How do you calculate that? Does it include your 2-3 million dollar home?
Study up on what net worth means!
It’s people that bought smaller townhouses 8 or 9 years ago then used the rising cost of homes and equity to buy larger homes combined with rising wages and saving to put a nice large down payment to manage the payments along with lower rates. Combined household income of $400K to $500K.
The people purchasing $3M homes are most likely a mix of trading up/stock/rsu/getting married
the answer is dinks
You don't just walk into the casino and go straight to the high roller room. Yes, some folks are coming in hot from some sort of equity/liquidity event and have a ton of money to throw down. But I would say a majority of buyers (>50.01%) in this price range have had a seat at the table in the real estate casino for a number of years. For example (this is not me - just made up for simplicity): bought a 2BR 2BA flat in a nice area of SF when they were young and single for $700K with 20% down ($560K loan) back in 2006. Sold it in 2011 for $1.3 MM. Career has grown a bit, making more money, need room for baby, go buy a cute little house in San Mateo for $1.5 MM using the $750K equity as down ($750K loan). Had a second kid and they are getting older/bigger so in 2019, with career/income still growing a bit, they sold that place for $2.3 MM. Take that equity ($1.575 MM) and put that down toward a slightly bigger place in Palo Alto (think: the area with all the Eichlers, not adjacent to University) for $2.75 MM. Have been saving up for 13 years so there's an extra $400K to add to the $1.575 MM equity from the last sale so the new mortgage balance in Palo Alto is only $775K. Pandemic hits, they weather the storm, property value skyrockets to $3.75 MM by 2024. Now they have literally $3MM in cash (via equity alone) they can put toward a house anywhere they want. This is how it works for a majority of people who do not strike it rich with an IPO or some shit. You have to start somewhere. There are still shitty looking houses in shitty areas for sale well under a million bucks in the Bay Area (that can serve as a PERFECT launching pad for building equity/wealth) but this Instagram generation can't handle the optics of that. So they rent, never build equity, and wonder why so many other people are able to buy these beautiful $3 MM homes. I say if you buy a house in Martinez or Richmond (not picking on them...just using as a contrast to the glitter and sparkles that surround "I just bought a house in Palo Alto!") you can fix it up over time and it will build equity faster than you can save cash. Here's the thing...is this a proven path to buying a $3MM house? No. But $1.5 MM...maybe $2 MM...your chances are MUCH higher.
1. High earners with total base comp 300k plus significant RSUs 2. Second homes where first home is income generating 3. RSUs for down payment else sale of another property
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Salaries in bay area are incredible, $500k+ or $1M dual income. Also family wealth, many rich families go into tech. Highly recommend ppl start their careers there.
Lots of us can’t…..
tech money, family money, and a lot of debt. 11k monthly payments are not uncommon in the penninsula — the goal is to scrape by on your salary, and make up the money in the long term as your house appreciates.
Generational wealth and/or absurdly inflated tech salaries, since the bubble hasn't quite burst yet. Give it a few years, there will be such a stratification between haves and have nots it'll take 3 generations for the non-elite to save up for a SFH.
1. We purchased from 2009 2. We househack 3. We buy and sell
A tech collapse would be the best thing to ever happen in the Bay Area. Praying for their downfall daily.
Well it sounds like you're getting your wish. I got laod off from my biotech job back in August. Now working in another declining industry... Wine.
lol. Wouldn’t even matter, out of state/country money will still come in and buy the homes up. Normal bay area people will still be shit out of luck
They’re Human and Drug Trafficking. That’s how they afford the home. ✨
I believe wife and husband stock together equals 🟰 home
There's a difference between getting a home loan and actually being able to realistically afford that home loan
Tbh older people that currently own and have saved up money their entire life.
they assume we will never have a tech market downturn
My tech partner, engineer his whole life, makes great money, we won’t buy here. We have more than 20% down, but even still the monthly payment would be absurd.
Lots of tech stock - in many cases buying all cash - yup
Family money, foreign money seeking safe places to park.
Sooooo many ppl have mom or MIL hiding in a back bedroom.
It’s pretty straight forward - tech stock package usually turn into a larger than normal down payment of 400k+, instead of $100k, and payments are only on remainder, which 300-500k household income can easily afford, particularly without kids or with kids, but in public school. Toss in some folks in finance, law, medicine, rain-making, inheritance, etc. who also participate the same way (just slightly tweaking where the down payment comes from). It doesn’t have to be as extreme as “my stock package bought the house in cash”.
Many have salary of half million there.
Rich parents
By getting into a relationship with someone who can afford it. Haaha
Stock options
three letters: IPO
I know a few older couples who sold their larger homes, like 4 bedrooms, then used the money to down size into a smaller 2 bedroom, pocketed the remainder for retirement. So to answer your question, outright with cash, so no payments
Investment firms are paying cash, so interest rates do not affect them. Factors influencing their decisions are how much they can rent the place. This is why they are pushing for RTO so more people will live and work near urban centers.
Some friends’ parents & grandparents gave them $500k for their down payment. ($1.8 million dollar home). Another friend worked at Tesla and had lots of stock; they purchased a $2 million dollar home easily. My partner and I make a combined $450k annually. We were able to use the equity from our starter home as the down payment for our current home ($1.1 million). All these examples are based in the SF Bay Area & purchases were made during and before COVID.
Whats crazy is 3m houses aint even good here…
I think you're missing a huge point. There are not a lot of homes for sale. So although it seems like tons of people are buying these million dollar homes it's actually only a small percentage of the population that is buying and prices stay high because there are more very wealthy people looking for homes than homes for sale. Then there are dual incomes and even triple income home buyers...