Originally Posted by explanade
Before or after taxes?
There's a new show, Million Dollar Listing San Francisco, talking about how the real estate in the City is booming from "tech buyers" flush with money.
Well they show a lot of twenty and thirtysomething people looking at $2-4 million properties.
One of the brokers waited around trying to hunt down a tech shuttle which they believed were filled with millionaires commuting from SF to the Valley.
Doesn't seem likely that that kind of money is being spread around that widely.
After taxes. Before tax means nothing, at least to me. All that matters is how much I can walk away with after paying the tax man.
I've seen a few episodes of that show, and think it's bogus. Not every person in tech is flush with cash. Far from it. Statistics are something like 95% of all startups fail, and even if they don't fail, a lot of them are acquired instead of IPO'ing for far less than was invested in them, which leaves nothing for the rank-and-file employee.
I was fortunate in that the company I worked for did have a successful IPO and has steadily grown since, and has good fundamentals. However, I'd still only say the first 50 to 75 employees made a life-changing amount of money, with people after that getting something decent, but not life-changing.
I know somebody in his late 20's who just bought a $1.7 million house but he didn't pay cash for it. He put down 20% and got a mortgage, which I'd say is far more typical. There's a lot of talk about tech buyers with cash, but I think those are limited to the outlier companies like Facebook, Twitter, Uber (when they IPO) with sky-high valuations. That's certainly not the norm. In fact, I'd almost venture that the bulk of cash deals for real estate in the Bay Area aren't coming from 20-something techies who suddenly made a fortune off their company going public. It's from offshore buyers and investors in Asia, China specifically. That's my gut feeling.