Price Condition of Housing Too Expensive in Silicon Valley
It is said that the home prices in the Bay Area or Silicon Valley in particular are so out of reach for many families of middle income group. Even for the high paid tech workers of big companies, the housing here is not affordable. There is a study revealed by a real estate startup Open Listings about this housing condition around the Bay Area.
Owning a Silicon Valley home is said to be affordable by these so-called techies employees, more than those workers as teachers, service industry workers and other scores of workers. But lately, there is now a signal of the area’s explosive housing costs that home ownership is not that easily obtainable by these techies or high salaried engineers.
According to a study, the software engineers of big tech companies in the Bay Area, would have to shell out over more than 28 percent of their salaries monthly in order to pay a house that is within 20 minute commuting distance from the place where they work. A study for example would cite an average software engineer earning $188,000 a year in a tech company, would have to spend 33 percent of this salary in allocation of the median priced home she or he owns in Cupertino. Other software engineers in other high tech companies would allot 32 percent of their incomes or 30 percent or 29 percent for mortgage and tax payments.
But still, these people who are allotting those mentioned percentages of their income for the mortgage payments are still having a hard time in getting a loan for a house. But still if ever they do get the loan, the amount is not the full amount of the price of the house, which would make them get more money to pay for the down payment. Saving up a standard 20 percent reserve for the down payment is still not enough especially for residents there who are already paying the high cost of rentals.
If this is difficult to have a home ownership in the area even for high tech workers, these local tech companies will have difficulty in recruiting and retaining employees then.
It is with this realization of the difficulty or condition that made the executives of these Bay Area tech companies to sign and support a bill that will make it easier to develop dense housing projects at nearby transit stations.
These executives expressed that the lack of homebuilding in the area is a hindrance in hiring employees and make their companies grow. The leaders expressed to be part of the solution since they recognized the fact that the shortage in housing could lead to displacement, crushing burdens on rent, long commute to work and harm to the environment.