Alex McCann

In the Bay Area, you're looking at 3% of at least $1 million.

Your annual property taxes (In San Jose) on that USD$1m will be on the order of $14,000. Your mortgage payment with a 10% mortgage will be another $4,255/month. That's $65,000/yr just to hold the house, with insurance adding another $3k (earthquake insurance!). Don't forget a maintenance budget of 1%/yr!

Additionally, you're going to be spending ~$8,500 in tax and fees just to close.

To repeat, if 3% is going to make or break your ability to buy the house, you can not afford that house. Imagine what happens when it drops 10% in value? What happens if it drops 10% in value, you need to move and market rents don't cover your mortgage[1]? The Bay Area has 30% swings from peak to trough, 10% is (slightly exaggerating) the peak to trough swing in a single year.

I never said that people who chose to go without an agent were stupid. I said agents were there to keep you from making stupid mistakes - but that was my experience. I had no concept of what the prices were in the area, or how to deal with selling agents who didn't want to close. The agent talked my partner down off the ledge a couple of times.

However, that doesn't mean that other people shouldn't consider managing their own purchase or sale. My comment was purely around the statement that saving 3% would allow you to buy a home.

[1] SF rent - https://medium.com/@mccannatron/1979-to-2015-average-rent-in-san-francisco-33aaea22de0e

> Income inequality is what a failing society does to motivate people by meeting their greed rather than meeting their needs.

Workers are not greedy for simply needing enough money to rent or own a home! In the same time frame, average US-wide rent has gone up from ~200$ to 1100$ [1] - that's a 450% increase. In "hot" areas such as SF, the development has been even worse [2]. On top of that, other necessities of life such as groceries have also continuously gotten more and more expensive [3], not to mention more expensive to obtain as neighborhood grocery stores closed down in favor of large malls.

We're talking about bare survival here. The costs of living have exploded for decades, while wages have been stagnant. People couldn't set aside money as a result, and now we have over half the US population unable to cover a 1000$ emergency without going into (even more) debt [4]. Wanting more money is not greed in these conditions.

[1] https://ipropertymanagement.com/research/average-rent-by-year

[2] https://medium.com/@mccannatron/1979-to-2015-average-rent-in-san-francisco-33aaea22de0e

[3] https://www.usinflationcalculator.com/inflation/average-prices-for-selected-grocery-store-items-2015-present/

[4] https://www.cnbc.com/2022/01/19/56percent-of-americans-cant-cover-a-1000-emergency-expense-with-savings.html

"This is manifestly untrue."

Actually, everything I wrote is a fact, and you can verify it. SF rents went down as recently as 2012, and are currently in a pronounced, acute period of hyperinflation [1]. San Francisco's population declined rather dramatically from 1950-1980 [2]

I'm sorry if this doesn't fit with your preferred narrative, but citing opinion articles does not provide data for your position.

[1] https://medium.com/@mccannatron/1979-to-2015-average-rent-in-san-francisco-33aaea22de0e

[2] https://cdn.vox-cdn.com/thumbor/2FrCiZiCNaMFiUqWC_RK8sh3NnU=/1600x0/filters:no_upscale()/cdn.vox-cdn.com/uploads/chorus_asset/file/4660089/Population-Growth_SF.0.jpg

Edit: even your sfist link confirms the basic facts, despite its (inaccurate and hyperbolic) headline. To wit:

"Dips in the population, urban flight, and a decaying Edwardian housing stock — much of which was built between 1907 and 1910 and was in great disrepair by 1970, when areas like Alamo Square were extremely "low-rent" and dilapidated — may have made life cheaper for the hippies, but that all began to change by the early 1980s."

So yeah...SF hasn't "always" been an expensive city. No more than any other city, anyway.

The data seems to back you up, so I stand corrected. [0]

I was basing it on my own experience pricing the rental unit I've managed in Berkeley for the last 21 years. Each year I do a rent survey for the East Bay, and that was based on my experience there, but the East Bay is a little less price sensitive in both directions compared to SF, so that's probably the difference.

[0] https://medium.com/@mccannatron/1979-to-2015-average-rent-in-san-francisco-33aaea22de0e

Ah, my recollection is definitely different. It was absolute madness for a while. You'd show up and there would be a line of 30+ people all waiting to see the same place. You'd also need to be armed with a "rental resume" along with the dreaded application fee to even be a contender.

When things burst, that all went away.

This was pretty interesting:

https://medium.com/@mccannatron/1979-to-2015-average-rent-in-san-francisco-33aaea22de0e