Re:Why Haven't Voters Been Buying the Case for Increasing Ho...
by nostrademons on Monday March 25, 2019 @12:56PM
(#19484219)
I know - I worked for Big Tech for 5.5 years. I was making a lot more than $200K/year at the end of it, and saving more than $100K/year.
The problem is that so is everyone else - or maybe not "everyone", but a significant enough fraction of the Bay Area to have a measurable impact on prices. So while I saved up a whole lot, most of it will get eaten up if we choose to buy a house in the area. The competition among homebuyers isn't your average middle-class professional, it's couples where both of them work at FAANG companies, making over half a million combined a year. When all buyers have the same means, prices rise to match, and you get inflation, you don't get wealth creation. The only way to get wealth creation is to build more wealth (in this case housing, but it also refers to other social services like childcare, healthcare, transportation infrastructure, etc.).
Right now, we're doing standard-of-living arbitrage: we live like people who don't (and didn't) work in tech, rent an apartment, and bank the rest, which gives me time to work on my startup idea (going for #1) and my wife a decent cushion to advance her career. That only works until what's left of the middle-class is entirely priced out of Silicon Valley, though. While immigrants and service workers can still find apartments, rents will remain priced at what they can afford, but if the housing crunch becomes severe enough that all of them move over the hill to Pleasanton or Davis (which is already happening to a lot of them), rents will jump to the maximum that a tech salary can afford.
The problem is that so is everyone else - or maybe not "everyone", but a significant enough fraction of the Bay Area to have a measurable impact on prices. So while I saved up a whole lot, most of it will get eaten up if we choose to buy a house in the area. The competition among homebuyers isn't your average middle-class professional, it's couples where both of them work at FAANG companies, making over half a million combined a year. When all buyers have the same means, prices rise to match, and you get inflation, you don't get wealth creation. The only way to get wealth creation is to build more wealth (in this case housing, but it also refers to other social services like childcare, healthcare, transportation infrastructure, etc.).
Right now, we're doing standard-of-living arbitrage: we live like people who don't (and didn't) work in tech, rent an apartment, and bank the rest, which gives me time to work on my startup idea (going for #1) and my wife a decent cushion to advance her career. That only works until what's left of the middle-class is entirely priced out of Silicon Valley, though. While immigrants and service workers can still find apartments, rents will remain priced at what they can afford, but if the housing crunch becomes severe enough that all of them move over the hill to Pleasanton or Davis (which is already happening to a lot of them), rents will jump to the maximum that a tech salary can afford.