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Comment by cactus2093 | Hacker News Reader

cactus2093

I mean FWIW I’m American and your explanation sounds very foreign to me. I’m a millennial though, so owning a house at all is quite obstacle. Scrounging up a down payment when even a 2 bedroom apartment is $1-$1.5 million is not the easiest task. Renting an extra 2 bedrooms to have lying around in case we suddenly need 2 offices would also cost an extra couple thousand dollars a month. My wife and I are both working from home from a 1 bedroom apartment currently.

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The US has very localized housing problems. Many tech giants are realizing that they have to either diversify their locations or enter into a housing spiral, as there just aren't enough houses for how many people they'd like to hire.

Once you step out of a small number of markets, the price problem goes away. I live in a well sized metro in the midwest, and I've worked, from here, for companies you've heard about. 4 bedrooms in my street, sitting on half an acre and a decent school district, are $250k. A 1 bedroom apartment would be under a thousand a month to rent, and that's a modern building with good appliances, a gym, a pool and gigabit internet. A single person in tech, right out of school, can easily save enough to get a mortgage in their first year working.

So yes, your situation is very real, but if there was less pressure to be in Seattle, NY or SF, the housing problems would melt.

It's more that the price problem follows the workers.

A decade ago, Seattle was cheap. You could get 4/5 BR homes in Kirkland for $400K. I just checked, and those homes are going for $1.2M now. Similarly, one of my former Google coworkers moved out to the Boulder office. When I'd checked on Boulder in the late 00s, you could get nice homes for $250-300K. He paid about $850K.

Wherever you have highly paid tech workers, you will have highly paid tech workers bidding up houses. You just have to get ahead of them, and buy where the FAANG offices are just being constructed rather than wait until you work there. True remote work (where you could dial in from anywhere, not just a city near an office) would fix this, but that's not really what's being offered these days, and when it is the salaries are more inline with what people make in the Midwest than what they make in Silicon Valley.

Pretty much any growing metro is experiencing a housing crisis because no where is building enough housing.

>Scrounging up a down payment when even a 2 bedroom apartment is $1-$1.5 million is not the easiest task.

This is why I don't live in the Bay Area, and have no plans to. I was casually surfing Trulia, and found new construction in my area starting at $170k for a 3 bed/2 bathroom. The idea of paying that much for an apartment(!) is simply foreign to me.

My generation (millennials) really do think life only exists on a handful of very expensive urban centers.

Most of the country is very affordable, but I guess they don’t have advertising tech companies saving the world so it’s not as desirable.

That's not the case at all for me and my millennial friends who have spread out to over a dozen different cities. Even my CS friends didn't move out of the midwest and are still in Chicago, Fort Wayne, and Indianapolis.

I get it. That's part of the reason we live AND work in the 'burbs (out near IAD, instead of inside 495). We were very purposeful about where we bought - balance of cost, location, etc. It's doable in most regions (SF/SV and NYC being notable exceptions).

And it's why I asked. At least my mental picture of Japan has most people living in very small (by American standards) apartments. That might not be accurate, based on other comments - with many people commuting 2+ hours each direction (which seems completely bonkers to me). Either way, the average size of a home in Japan is smaller than the US (though I have no idea how it compares to Europe).

2+ hours sounds like they want to live pretty far outside of the city. You can get a reasonably priced and sized place in Chiba and be in the heart of Tokyo in an hourish.

Yeah, it does. I got that from kubatyszko's response to my OP.

I grew up in Silicon Valley and worked there until a few years ago when I moved to the Midwest to do a PhD. My wife and I are millenials and she is also from a big city area. The plan was to move back to Silicon Valley, where I can easily get a lucrative job in my field. But when we did the math, it was an easy decision to stay in the Midwest.

I miss the weather, but we're so much better off financially. Plus we bought a 2,400 sqft home with 3/4 acre in an amazing area for $300k. I have a huge home office, and two extra bedrooms. I don't need this much land, but to be anywhere near this comfortable in Silicon Valley would be years off and would require several things to work out perfectly.

In the same spot. Home ownership is so out of reach for the vast majority of the people my age. Even with good salaries and savings!

Most people my age who have purchased a home got significant help from their parents.

Or we just don't live in the Bay Area...

It's really not out of reach unless you insist on living in a major metropolis. A young couple earning under $100k combined can afford a comfortable 3-bedroom home in all 50 states, just not in a large city. Mortgage rates are near all-time lows and the 20% "required downpayment" has been a myth since before you were born. You don't even need great credit to buy a home with a mortgage under $1500/mo all-in with taxes and insurance. Now that remote work is increasingly accepted there's never been a better time to buy in the suburbs.

After all this, for many people I suspect that living in the core area of an "elite" city is going to become a luxury lifestyle decision rather than at least a perceived cost that is part and parcel of desirable jobs. Some will still choose to do so, but it will be the same sort of expensive optional choice that living in a trendy beach or mountain town will be.

$100k? A quick google shows me that median household income in the US is closer to $60k. And that's the median, so half of households will be lower than that.

I presume the OP's comment was in the context of the typical HN crowd, which I would imagine has a higher than average income.

Assumptions, not data. Even if you assume the reader of HN is in tech firm, you can assume the "household" income average

It seems a reasonable enough assumption to me, that tech workers make more than average - so much so that I didn't feel the need to trawl for a peer reviewed data source.

I would guess the ones earning that much are probably in metro areas like the bay area and Seattle.

I imagine those in the Bay area are making a lot more than 50k/year, or at least there are always SV devs chiming in saying they are making 300-600k/year (the OP said 100k for a couple).

I make the equivalent of 100k USD in a tier 2 city in Scotland (a single income that is, not a couple combined). It's not outlandish for senior roles across much of the UK (with "normal" companies, not FAANG).

Yeah, dude, there's a site "Levels FYI" that gives real data. If anyone's having trouble wrapping their brains around it, just keep in mind that every business needs to send a sizable chunk of its revenue through Silicon Valley to stay competitive (via advertising, office equipment/software, apps, etc)

100k is attainable even in the middle of nowhere in the USA, but you'd probably be better off working remotely for someone for 120k+

New CS grads start off at like 120k. New boot camp grads start off at like 100k. If you're experienced, you might get up to 200k. If you're experienced and good, you can hit 300k and beyond. Once FAANG sets the standard like this, then basically everyone else needs to offer similar salaries if they want to compete for that same quality of engineer.

That is true; however, only 29% of the households are dual income.

It was a somewhat-arbitrary line. $60k/yr is about $3k/mo takehome. While that's not a lot of money, it's enough to live a modest lifestyle including a mortgage and raising children with only a single parent working. I'm not saying it won't be a struggle, but it's doable. It's how I was raised and it's how most of my family lives, and I'm in NJ, which is in the top 10 most expensive states. My niece and nephew-in-law live comfortably on $70k with two kids, two cars, one earner, and just bought a house. Life is hard and that's ok.

While true, ~30 percent of households in the US are single-person (see https://www.statista.com/statistics/242189/disitribution-of-...). And a number of others are single-parent. The parent specifically talked about a couple's combined incomes.

Looking at https://www.census.gov/data/tables/time-series/demo/income-p... (the "Married-Couple Families" section), the first data set ("All Races"), the numbers I see for median household income, by age, are:

25-29: $76.5k 30-34: $92k

30-34 is stretching the definitions of a "young couple", of course. I'd love numbers for 20-25, but this data set lumps in 15-24 all together, though the set of married couples under 20 is presumably pretty small.

$76k is still not $100k, of course.

People go where the jobs are. They are going to live wherever employers "insist on" locating their offices.

20% down payment isn't a myth; if you don't put 20% down (and don't have some special situation like a VA loan) you have to pay for private mortgage insurance which can be hundreds per month, as you're buying the lender insurance against the possibility of you defaulting on your loan.

Depending on your situation, PMI may be worth it. For example I was paying 1200 a month for a 1 br apartment. They wanted to up it to 1500 a month. Instead I bought a house with 5% down. The total monthly payment for a 200k house, including PMI, is 1,100 a month.

Even with PMI I am still paying less than living in the same apartment year over year.

5% down is typical in high cost cities

PMI is reasonable. I put down 5% on my first home, (<$20k) and commuted via train. Just get a cell modem and do your morning work rituals (email, news, etc) on the train. I sold that house 3 years later at 13.5% appreciation, with good equity on top. I used all of that towards the down payment on house #2.

Commute in from a small investment home/condo to let equity + appreciation get you into the home you want a few years down the road. Even in my starter, I got twice the sqft for the same monthly as my not-very-close apt.

I agree, but the jobs are only in the cities, unfortunately. Remote work is a thing, but it seems that isn't quite as easy to find as HN would think.

You can take 600k 30 minutes out of seattle and love your 2800sqft modern home (approx/just now starting to look for myself)

Update: (Not modern but im a fan anyway. https://www.redfin.com/WA/Bothell/15601-Cascadian-Way-98012/...

600k is too low for any home in the area that isn’t in bad shape at that size (and your example shows this). Also, that 30min can become 1h+ with traffic, with almost no public transit alternatives.

Everett is a solid 600k contender if closer to 2000sqft

I used to live in that area and it would regularly take 45+ minutes to get to/from Bellevue and could take over an hour to Seattle.

Edit: also a home like that would probably have been like 450k just 4yrs ago. Prices have skyrocketed around here

> 450k just 4yrs ago

> > 600k

Speaking of skyrocketing, GP's link says 700k for me.

Scrounging up a down payment when even a 2 bedroom apartment is $1-$1.5 million is not the easiest task

America is a big country and is not specific enough when describing these prices.

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