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Tech Employees Flee From Silicon Valley Housing Market

San FranciscoAccording to an article by the Observer’s Sissi Cao, prime-age workers (those in their mid-30s) are retreating from Silicon Valley due to the lack of affordable housing.

“A typical software engineer at the highest-paying tech companies in the area now needs to spare a third of his or her income to afford a home near work, which runs around $1.2 million,” Cao reported.

In an attempt to alleviate this problem, Trulia found that the Golden Gate City built more new homes than any other city in 2017. Last year the city approved 94.6 percent more homes than its average between 1980-2016. The total number of permits in 2017 was 6,270.

Although San Francisco’s affordability crisis has been waging for more than a decade, it seems to be reaching epic proportions. A recent Black Knight report found that San Francisco hit a new peak in home appreciation, as prices rose by more than 11 percent year-over-year in December 2017.

One way tech companies are reacting to the affordability problem is by building branches outside of San Francisco to retain employees, as conveyed by Lux Capital co-founder Josh Wolfe, who spoke to Cao. However, for residents who don’t want to move out of the city, unorthodox living arrangements may be the solution. New York Times writer Nellie Bowles recently delved into this problem, finding that some professionals are moving back into dorms when priced out of the single-family housing market.

“Everybody told me housing in San Francisco was really expensive, but I was like, ‘I live in New York, how much more expensive can it be? … I was a bit cocky,” Katherine McKim, 37, told Bowles.

 

About Author: Rachel Williams

Rachel Williams attended Texas Christian University (TCU), where she graduated Magna Cum Laude with a dual Bachelor of Arts in English and History. Williams is a member of Phi Beta Kappa , widely recognized as the nation’s most prestigious honor society. Subsequent to graduating from TCU, Williams joined the Five Star Institute as an editorial intern, advancing to staff writer, associate editor and is currently the editor in chief and head of corporate communications. She has over a decade of editorial experience with a primary focus on the U.S. residential mortgage industry and financial markets. Williams resides in Dallas, Texas with her husband. She can be reached at [email protected]
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