Homeownership in the San Francisco Bay Area

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Real Estate Agent with Compass CA DRE# 01215160

We've long heard that home ownership is out of reach for many in the Bay Area, and this report about prices, affordability and monthly cost will do nothing to change that opinion. But there are steps one can take instead of giving up.

Gathering data from the California Association of Realtors, Compass statistician Patrick Carlisle breaks it down into understandable language and graphics. These figures take into account median home sale prices (see first chart, above) and prevailing mortgage rates in the second quarter of 2019. They assume a 20 percent down payment and also includes taxes and insurance in monthly costs. 

Minimum income needed to buy in SF Bay Area

Monthly cost of housing in SF Bay Area

When qualifying income over $343,000 per year is needed to buy a median priced home in San Francisco, with monthly payments hovering around $8,580, it's not surprising that many people look elsewhere. Next door neighbor, San Mateo County, is only negligibly less costly, and slightly less are the counties of Marin (across the Golden Gate Bridge) and Santa Clara (think Silicon Valley.) Even condominiums in San Francisco are costly.

Other parts of the greater Bay Area are more affordable. The upscale communities of Orinda and Moraga are options for some buyers and are somewhat more affordable. An income over $270,000 might be needed, but the homes are larger.

Generally speaking, the further from San Francisco one goes, the less costly homes become. Solano County, with a median home price of $445,000, is affordable for those making under $100,000/year.

As mortgage rates drop the picture brightens a bit, and if one is able to put more than 20% down (very common here) the picture brightens even more.

Given the above, if you are thinking of making a purchase, you can see why it is vital to work with a knowledgeable real estate agent and mortgage advisory with whom to engage in some strategic thinking so your dream of home ownership can be realized. It is possible; people do it every day.

 

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Rainmaker
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Nina Hollander
Coldwell Banker Residential Brokerage - Charlotte, NC
Your Charlotte/Ballantyne/Waxhaw/Fort Mill Realtor

Hi Lottie... those numbers seem stratospheric to me when I compare them to Charlotte where the media income is $65,000 and the median home price around $260,000!

Aug 15, 2019 05:13 AM #1
Rainmaker
3,271,338
Wayne Martin
Wayne M Martin - Chicago, IL
Real Estate Broker - Retired

Good morning Lottie. Your numbers are in a different atmosphere, but always like hearing about them. Enjoy your day!

Aug 15, 2019 06:16 AM #2
Rainmaker
2,543,915
Brian England
Arizona Focus Realty - Gilbert, AZ
MBA, GRI, REALTOR® Real Estate in East Valley AZ

Affordable housing budgets in the San Francisco area equate to luxury home budgets in my area.

Aug 15, 2019 07:43 AM #3
Rainmaker
1,776,658
Lottie Kendall
Compass - San Francisco, CA
Helping make your real estate dreams a reality

I know what you mean, Nina Hollander - the prices--and salaries--seem unreal, rather like playing Monopoly.

I remember visiting London in the early 1970s and being in wonder at how people could afford to buy ordinary row houses that were so very expensive.

Aug 15, 2019 07:46 AM #4
Rainmaker
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Lottie Kendall
Compass - San Francisco, CA
Helping make your real estate dreams a reality

Hello Wayne Martin and Brian England - home prices and cost of living are definitely high here, so when the mortgage interest rate deduction is capped, it hurts entry level homeowners, not simply the wealthy ones. 

Aug 15, 2019 07:48 AM #5
Ambassador
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George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
Your Connecticut Mortgage Expert

Lottie I knew that incomes were higher out there than here on the East Coast, but I did not realize they were that much higher.

Aug 15, 2019 12:52 PM #6
Rainmaker
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Lottie Kendall
Compass - San Francisco, CA
Helping make your real estate dreams a reality

Incomes are high here George Souto - but the cost of living and purchasing a home are higher yet. When buyers need to have $340,000 qualifying income to purchase a median priced home, it's tough.

Aug 17, 2019 05:24 AM #7
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Rainmaker
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Lottie Kendall

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