I'm going to go out on a limb here and say most people in USA don't even have all those things.
The "kill my neighbor's cow so everything is even" is an even more toxic thought pattern than the Prisoner's Dilemma that constitutes our mainstream.
Think big, man.
The salient fact of American politics is that there are fifty to seventy
million voters each of who will volunteer to live, with his family, in a
cardboard box under an overpass, and cook sparrows on an old curtain rod, if
someone would only guarantee that the black, gay, Hispanic, liberal,
whatever, in the next box over doesn’t even have a curtain rod, or a sparrow
to put on it. - Davis X. Machina, balloon-juice.com
1. http://i.imgur.com/LTZOFlC.png
...and I've talked about this before: https://news.ycombinator.com/item?id=8154909
Silicon Valley, at its best, is doing exactly that. And sure as hell isn't anyone else trying.
First, $5900/month is a huge amount to spend on housing. Large houses on the peninsula rent for around the $4500 range; you only hit $5900/month for 4 bedrooms in the hottest neighborhoods of SF.
Paying $5900 (after tax deductions, including property taxes) for owning a house implies a $1.3M mortgage, so maybe a $1.5M house(?) which is high-end. Houses that cost over $1000/sq foot are very rare; most are in the $600 range looking at Zillow on mid-peninsula.
Also, note that owning a $1.1M house is a form of retirement savings, so you can adjust accordingly.
And housing costs differences of $800k over 30 years (your Madison link vs. a $1.1M Bay Area house) is about $3300/month. You need to earn maybe $70k (before taxes) more in the Bay Area to have equal non-house income. I find it hard to believe that earning $180k in Madison combined (top 8%) is struggling.
Finally, there's always the Easy Bay: great houses in great neighborhoods for $800k.
Using a house for retirement savings is for idiots; that's an enormous gamble on the future of CA 35 years from now.
The Madison house, btw, is in a location walkable from many offices; Madison is more competent than the bay area, so while buses aren't great, the roads are very drivable in many directions. Someone with even an hour long round trip commute has a very long commute there (except, perhaps, after snowfall.) So you could probably use one car, or one commuter car and one beater car for a couple. Not two cars as you need on the peninsula or sf for a couple with kids.
Not to mention that $70k doesn't capture all the other things significantly cheaper in Madison: food, daycare, and education (many Madison schools are quite good) being the most important. Many peninsula schools are quite good, but not in sf.
If you view it as plausible your house value will collapse, you shouldn't buy a house. If so, you'd rent and you'd be looking at much lower housing costs.
With regards to cost of living: some things are much more expensive in Madison; e.g. utilities (no A/C needed in Bay Area; heating rarely needed).
Anecdotally, I know a gainfully employed senior engineer who was literally couch surfing with his wife and daughter for a month after losing their house. The excessive price of living caused by the housing shortage in the bay cannot be understated.
http://www.rightmove.co.uk/property-to-rent/Hackney.html#/pr...
This flat in hackney is £675 per week and is 1700 square feet. (That's £2925 per month, or $4678 per month).
That price does not include council tax or utilities. Council tax at the lowest but full rate is £864.96 per month. That's roughly $1385 per month.
Also, please note the /sf (per square foot) of his price quote. I also thought it was way too cheap even for the Mission in SF, until I noticed the /sf.
$240k married filing jointly w/ 2 kids means $5900 hits your bank account twice a month. Essentially all of one of those paychecks will go to housing in sf, or a mortgage + taxes on the peninsula. That leaves $6k per month to live off -- which is certainly doable, but between childcare (at least after school w/ both parents working, possibly more), utilities, telecomm, cars, savings, groceries, and all the miscellaneous costs of life such as clothes, doctors visits, etc -- you aren't saving much money.
ps -- it's stupid to look at national statistics for income when this is the #1 most expensive housing market in the US. At least nyc has good transport options between Manhattan and Brooklyn / Queens. Here we have caltrain or the 580.
I mean, here's a home right here [1] -- 4 bedrooms for $315k! Of course, it's in Madison, WI -- but that shows housing prices are just fine in sfbay :rolleyes:
[1] http://madison.craigslist.org/reo/4668467650.html
@smtddr: we're not discussing what most people have; we're discussing what you can get in the bay area on $240k. Otoh, if you're now claiming that keeping up with the joneses == a middle class life, ie wanting a modest house, cars, kids, and retirement savings, then the plutocrats have won.