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Old 01-18-2015, 12:54 AM   #21
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I think that the bull market in equities is inflating compensation right now as those stock options granted over the past 5-6 years are deep in the money. People should enjoy the extra income while it lasts. I know that, personally, we are one bear market away from a big drop in income.
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Old 01-18-2015, 01:48 AM   #22
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We've seen a number of boom and busts over the years. When we moved here decades ago SV was actually in a job and housing slump compared to the rest of the Bay Area. Who knows what the future will hold for any particular area over the long term. New York is still a world wide financial hub, but Detroit has sure changed over the last couple of decades.
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Old 01-18-2015, 05:40 AM   #23
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That was smart. We are trying to tell our kids to do something similar.

Kiddo #1 lives quite well on modest means in a rented apartment in a beach location. We've pointed out that even spending $1K more a month post college but otherwise keeping the same quite pleasant lifestyle while earning a Bay Area IT salary could provide $12K of extra fun and travel money while also setting enough aside to fund ER at a relatively young age.

We have many friends that managed to get into financial trouble despite two Bay Area IT salaries. LBYMs is still the key to financial security regardless of income.
For quite a few years after college I lived with roommates even though I had a high income. If I lived in a lower cost of living area I wouldn't have done it, but it just made sense in high rent Silicon Valley. In fact, all the way through the tech bubble, the most I ever paid in a month for rent was $675 when most of my friends were paying over $2000 per month for an apartment. When prices came down to earth, I got my own place. It was definitely a 6 figure decision, in that it saved me over $100K when I combine savings and the investment return on those savings.
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Old 01-18-2015, 07:02 AM   #24
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We've seen a number of boom and busts over the years. When we moved here decades ago SV was actually in a job and housing slump compared to the rest of the Bay Area. Who knows what the future will hold for any particular area over the long term. New York is still a world wide financial hub, but Detroit has sure changed over the last couple of decades.
Interesting you should bring up Detroit.

Back at Megacorp, this discussion comes up frequently on our internal forums. Usually it goes like this: "We like Palto Alto because of the schools, we're looking at a fixer upper for $2.2M. This will put a strain on us. We come from the midwest and are not sure this is a good price. There's no danger of a crash or anything, is there?"

Answer: "Nah, this isn't Detroit. We're different than Detroit. Go ahead and buy now. Might as well bid 2.3 and get it. Our Megacorp is different, we're ruling the world in case you didn't notice. Nothing to worry about. Besides, even if there is a tech blip like 2001, we came back fast from that."

Yes, I paraphrase, but the general tone is real. I honestly don't know where this ends up.
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Old 01-18-2015, 07:14 AM   #25
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I remember this photo from the 90s. It needs updating. The price should be $1,999,995.ImageUploadedByEarly Retirement Forum1421586862.477268.jpg


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Old 01-18-2015, 08:43 AM   #26
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Kiddo #1 lives quite well on modest means in a rented apartment in a beach location. We've pointed out that even spending $1K more a month post college but otherwise keeping the same quite pleasant lifestyle while earning a Bay Area IT salary could provide $12K of extra fun and travel money while also setting enough aside to fund ER at a relatively young age.
DD is paying only $500 a month for sharing a townhouse in San Jose.
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Old 01-18-2015, 08:51 AM   #27
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We've seen a number of boom and busts over the years. When we moved here decades ago SV was actually in a job and housing slump compared to the rest of the Bay Area. Who knows what the future will hold for any particular area over the long term. New York is still a world wide financial hub, but Detroit has sure changed over the last couple of decades.
SV has more diversified businesses (semiconductor, electronics, medical devices, social networking, etc. ) than New York or Detroit.
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Old 01-18-2015, 08:57 AM   #28
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I remember this photo from the 90s. It needs updating. The price should be $1,999,995.Attachment 20934


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Yes, price of real-estate in SV is nuts. People are still bidding up the asking prices. Many Chinese "investors" from Mainland would buy them with minimal inspection and resell them. Housing in the north East Bay (e.g., Concord, Brentwood, Discovery Bay) is still affordable, but the commute is terrible to the valley.
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Old 01-18-2015, 12:12 PM   #29
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We've had fun posting about this one here before - uninhabitable, infested with rodents, located in a flood zone, former hoarder house - yours for the low, low asking price of only $1.8M:

‘Uninhabitable’ Palo Alto Home On Market For $1.8M - CBS San Francisco

Hoarder House In Palo Alto Is On the Market for $1.8 Million

"The listing on Trulia hasn't even bothered to conceal the home's decrepit state. Instead, it just notes: "Property is not habitable. Property is located in a flood zone. Prospective buyers to drive or walk around property only."
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Old 01-18-2015, 03:22 PM   #30
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Originally Posted by daylatedollarshort View Post
We've had fun posting about this one here before - uninhabitable, infested with rodents, located in a flood zone, former hoarder house - yours for the low, low asking price of only $1.8M:

‘Uninhabitable’ Palo Alto Home On Market For $1.8M - CBS San Francisco

Hoarder House In Palo Alto Is On the Market for $1.8 Million

"The listing on Trulia hasn't even bothered to conceal the home's decrepit state. Instead, it just notes: "Property is not habitable. Property is located in a flood zone. Prospective buyers to drive or walk around property only."
"a group of investors pays $2 million in cash for the property and bull doze it to build a new house .."
Uhm .. must be those people from Mainland China.

http://www.theatlantic.com/china/arc...o-alto/281234/
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Old 01-18-2015, 03:41 PM   #31
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Of course, Palo Alto is the extreme.

There are plenty of homes to be had in Santa Clara, for instance, for only $800,000. They may be 50's era, and small, but they are "affordable."
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Old 01-18-2015, 03:53 PM   #32
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Of course, Palo Alto is the extreme.

There are plenty of homes to be had in Santa Clara, for instance, for only $800,000. They may be 50's era, and small, but they are "affordable."
That seems odd - Santa Clara is in the heart of SV. I guess proximity to Standford U and Facebook is more desirable.
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Old 01-18-2015, 04:51 PM   #33
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There are plenty of homes to be had in Santa Clara, for instance, for only $800,000. They may be 50's era, and small, but they are "affordable."
There are some available but I wouldn't say there are plenty. The whole silicon valley area extremely tight by the months of supply metric. For Santa Clara (the city) I see 20 houses for sale with 125 sold in the past 90 days on zillow. So that's way less than 1 month of supply (I think the rule of thumb is 6 months of supply is considered balanced between buyers and sellers).

The whole area has been like this for at least year, probably more.
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Old 01-18-2015, 04:59 PM   #34
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In years past I would describe Portland's tech as hardware, now it appears that software is gaining momentum. A recent article in the Oregonian stated that eBay's employment has grown to over 200. Oregon tech: A selling spree -- and a growth spurt | OregonLive.com


Our housing and cost of living isn't cheap but it is less than the Bay Area or Seattle. PDX-SJC is almost a commuter run.
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Old 01-18-2015, 06:20 PM   #35
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It's not what you make, it's what you keep, high taxes and high living expenses take a huge bite out of the $250k salary


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Old 01-18-2015, 07:25 PM   #36
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There are some available but I wouldn't say there are plenty. The whole silicon valley area extremely tight by the months of supply metric. For Santa Clara (the city) I see 20 houses for sale with 125 sold in the past 90 days on zillow. So that's way less than 1 month of supply (I think the rule of thumb is 6 months of supply is considered balanced between buyers and sellers).

The whole area has been like this for at least year, probably more.
Yes. I was being slightly sarcastic.

Comparing to Palo Alto which is one of the supreme SV locations.

I mean, you can also investigate Milpitas near the prison for maybe somewhere in the 600s. But supply is tight. Hence the rise in prices.

When I speak to my Megacorp friends and tell them about other places in the USA, they cannot believe that our houses, similar in age and square footage, run 100s to 300s depending on the area. Dumbfounded. Then again, I'm dumbfounded by their salaries and bonuses, so I guess it goes both ways.

The key is if you can find a cheap way to live, you can make good cash in SV these days, even with the tax load and some other issues. I guess that is the point many are making on this thread.
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Old 01-18-2015, 08:02 PM   #37
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I think that the bull market in equities is inflating compensation right now as those stock options granted over the past 5-6 years are deep in the money. People should enjoy the extra income while it lasts. I know that, personally, we are one bear market away from a big drop in income.
I couldn't disagree more. I'm from the Bay Area, was just there visiting family over the holidays, and the transformation from when I left almost 30 years ago is unbelievable. There will be no drop in incomes there in our lifetimes. You might see incomes slow down a bit, as you did after the '08 crash, but no drop. Whole family either works or has worked in tech. I tell them SF is just LA (smog, horrendous traffic, gangs, graffitti, none of which was there when I was growing up) without the glamor, although it now has that awful tech attitude to match LA's celebrity obsession. Were it not for visiting the family, I'd never go back to the Bay Area for any reason.

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Yes. I was being slightly sarcastic.

Comparing to Palo Alto which is one of the supreme SV locations.

I mean, you can also investigate Milpitas near the prison for maybe somewhere in the 600s. But supply is tight. Hence the rise in prices.

When I speak to my Megacorp friends and tell them about other places in the USA, they cannot believe that our houses, similar in age and square footage, run 100s to 300s depending on the area. Dumbfounded. Then again, I'm dumbfounded by their salaries and bonuses, so I guess it goes both ways.

The key is if you can find a cheap way to live, you can make good cash in SV these days, even with the tax load and some other issues. I guess that is the point many are making on this thread.
Sister and brother-in-law are paying $5K/month for an upscale townhome in Campbell, and they're only renting. Brother in law is a high paid exec with a big tech firm, and they're priced out of the market.
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Old 01-19-2015, 09:55 AM   #38
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When I speak to my Megacorp friends and tell them about other places in the USA, they cannot believe that our houses, similar in age and square footage, run 100s to 300s depending on the area. Dumbfounded. Then again, I'm dumbfounded by their salaries and bonuses, so I guess it goes both ways.
Yeah it was very discouraging when house hunting in SV to see that the downpayment alone would cover the entire house in other states.

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The key is if you can find a cheap way to live, you can make good cash in SV these days, even with the tax load and some other issues. I guess that is the point many are making on this thread.
That was the plan for us but I don't think we executed it very well compared to some in this thread. We bought a starter home in san jose and our mortgage was nearly 3k/month.


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Sister and brother-in-law are paying $5K/month for an upscale townhome in Campbell, and they're only renting. Brother in law is a high paid exec with a big tech firm, and they're priced out of the market.
Campbell is not that expensive. If they can afford 5k/month rent they probably could afford a fairly nice house, a few levels above starter, just not anywhere near what you could get in other states.
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Old 01-19-2015, 10:12 AM   #39
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Seattle is pretty hot right now (Microsoft, Google, Amazon, Apple)

Wife pulls in similar to those figures with bonus as a senior software engineer but she is brilliant and performs the work of 3 normal engineers.

Warm bodies can still get into six figures and engineers with more people skills (my wife tells her boss and his boss how wrong they are quite frequently) can get above $300k.
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Old 01-19-2015, 11:02 AM   #40
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Although not specifically Silicon Valley or San Francisco, my SF Bay Area organization has about 600 employees with job classifications related to software development. Based on the salary distribution from a few years ago and projecting forward using average raises, 2015 salaries at given percentiles are ...

10%: $120K
25%: $135K
50%: $153K
75%: $175K
90%: $206K

Bonuses are either $0 or insignificant, but benefits are good. About half the employees are in a very generous DB pension program. The other half are in a 401k with the employer matching ~10% of salary (i.e., an additional $10K-$20K a year).
Wow...software guys make big bucks here. I've been in the Bay Area for 20+ years and I'm below that median salary with a semiconductor company. I'm an Eng Mgr with a Masters and I thought I was well compensated ...

We were lucky to buy in the early 90's. A larger earthquake has a bigger effect on local prices it seems than a large recession (prices after the Loma Prieta dropped a fair bit, after 2008 not so much). It is too crowded here for me but DW is a city girl and the weather is hard to beat (upper 60's this week). Price of housing seems to be driven by Mainland Chinese and Indian who often have 3 generations in the house but it's good for me. If I need extra cash for retirement my house will do nicely since it's paid for and is worth FAR more than I paid for it
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