[qurren]

It's interesting that $14000/month is "rich" on this website, and some people earning $100/month actually own houses.

Meanwhile people making $50000/month in San Francisco can't afford a house because half of it is taxed away and housing is astronomically expensive.

[tjohns]

You have it backwards. Housing is astronomically expensive in San Francisco precisely because there are so many people with high incomes bidding against each other.

When you have a highly inelastic supply (constrained by zoning laws, density limits, and geographical boundaries), prices rise to the maximum margin of what the highest-income buyers are capable of paying.

Regarding taxes: Since taxes apply to all local high-earners equally, it doesn't change their relative purchasing power against one another in the local housing market. If taxes were suddenly halved, that extra liquidity would be priced into the next bidding war, driving home prices even higher.

[EPWN3D]

I promise you that someone in SF making $50k/month can comfortably afford a very nice house.

[qurren]

I promise you not. Houses here cost $2M+ for something livable and $1M for something with mold and other safety issues.

When half that $50K gets taxed, half of what's remaining has to be saved up for retirement in a place that deeply discriminates against age, you don't have much left to save up for buying a $2M house.

[skissane]

> half of what's remaining has to be saved up for retirement in a place that deeply discriminates against age, you don't have much left to save up for buying a $2M house.

Buying a $2M house is saving for retirement. Owning your own home in retirement is a massive financial win. And if you own a home in an expensive market, you can sell it, buy one in a more affordable market, and then the difference is unlocked retirement savings.

[onraglanroad]

Ok, I made my other comment before seeing this but I find it very difficult to believe you can't find something reasonable for far less.

[arjie]

It’s untrue. Unstated assumptions are the quality of housing desired and location desired. In practice, because of the rent/price ratio being low here in SF most people will be taking a downgrade when going from rent to 1.25x that as mortgage after putting down $300k for a $1.5m.

It is true that the marginal rate can be very high, though, so heuristics based on pre tax income break down at these numbers. The place we live in costs $7k/mo but to buy it we’d have to spend $450k and then $9.5k/mo.

[qurren]

Nah it's the reality here. I'd say minimum income to safely own housing here is $100K-150K/month. OR cash already saved for the home, in which case income doesn't matter.

Yes, lots of households make that much, especially people at e.g. Nvidia with unvested appreciated RSUs.

Yes, the US economy is that badly fucked.

And the people on mortages were brainwashed into buying something they can't afford, and in for a foreclosure disaster when the economy corrects.

[polairscience]

In every thread about housing people on HN post wildly outlandish claims about expenses that belie their totally out of touch perspectives. If you make 100K a month (the lower bound of what you just wrote). Let's say you put 25K into retirement. You eat out every meal so 4K food/living budget. That leaves 60K (I'll give you 10K slush fund for savings money or as a general keeping-up-with-the-jones' fund).

60K per month will pay a 4.5 million dollar mortgage. 4.5 million will buy you some of the nicest houses in the bay that aren't mansions. See:

https://www.realtor.com/news/unique-homes/midcentury-modern-...

You are either insane, or out of touch in a way that makes you insane. Of course, you can get a much cheaper very nice condo and "safely" squirrel away phenomenal amounts of cash savings. Expecting to own a high end house in a dense metro are on its own, is a pretty insane expectation.

[onraglanroad]

Thanks for your comment. It makes a little sense that the average person might struggle with costs in the US, but it doesn't make sense that the highest earners do.

[nostrademons]

Don't forget taxes. In that bracket, in California, you're paying 50% of your income in taxes, and so $100K/month is actually $50K/month.

I think OP is overselling the point, but not by nearly as much as people think.

[qurren]

> 60K per month will pay a 4.5 million dollar mortgage

A mortgage is NOT owning! So many people are poisoned by this propaganda promoted by American society and banks. They prey on the masses by infiltrating the public with this live-on-borrowed-money ideology.

Your 60K/month may end NEXT month and become 0/month if you are subject to the next round of Zuck's layoffs, or you end up stack ranked and PIPed at Amazon due to internal politics. One of these things happen and poof you're in the 0th percentile of income.

In the bay area, if you want a $4.5M home, you need to have $4.5M in cash or liquid assets. Period. Otherwise you're risking a foreclosure disaster if you accidentally say something wrong in a leadership update meeting, or if this AI heyday comes crashing down.

Borrowing money does not mean you own something, and is a very American way of doing things.

[kbelder]

You can't make many national judgements based on the economics of the Bay Area. It's much more sane in nearly every other area (with some other outliers, such as New York City).

[tenuousemphasis]

You're shifting the goal posts, but I'll bite... what is 'safely' owning a home, to you?

[dwa3592]

I am not even sure if you are being sarcastic.

https://www.zillow.com/homedetails/80-Prentiss-St-San-Franci...

check this out.

[mikestew]

Man, that's nicer than houses in Redmond for the same money (though the SF one is a touch smaller), and you won't get that view. Bay Area house prices are insane, ya say?

[onraglanroad]

If your net pay is $7000 per month you absolutely can afford to own a house, you're just being fussy about the house you want.

[burner420042]

Does the website reference net or gross monthly income?

Edit:

So the numbers are not a direct exchange rate to USD.

Q: How were dollar values assigned to households? A: The households’ door numbers represent the consumption values (US dollars) that each adult in the household has per month. This figure comes from a combination of the household’s self-reported consumption and income levels. We then checked the official cost of living data in each country to adjust the values for purchasing power parity (PPP) and converted the value into US dollars. Read more about how we assigned the Dollar Street values here.

[jt2190]

The housing market is highly dependent on the job market so no, it’s not “being fussy”, it’s “I need to live here so I can have a job and income”. Unless you’re suggesting that people should quit their jobs and go get that cheap house in the middle of nowhere?

[onraglanroad]

What does the person who fixes your toilet do? Or prepares your meal? Or basically lives the Fight Club life?

[qurren]

If they didn't tax everyone so damn much, it would work out.

They fix the toilet for $200, I need to earn $400 to have that $200, and the toilet repair person gets to keep $100 after their taxes.

$400->$100 in one go. Government keeps $300. Make that make sense.

[aianus]

Depressingly, they bought a house in 1995 before the prices exploded. You need a 94th percentile income in Toronto to barely qualify for the average house.

[jltsiren]

Its more about where you want to live.

I'm not familiar with the situation in San Francisco. But in Santa Cruz, the cost to own with a 20% down payment is ~50% higher than the rent for the same unit. If you can't afford a substantially higher down payment, you're not really in the market for a home.

With $7k/month after tax, you would probably be renting an 1br, or maybe a cheap 2br. But your income is not high enough to buy anything, unless you start looking for homes well outside the town.

[qurren]

You're not going to save up for a $1-2M house very fast on $7000/month, when you also have to live off that $7K, pay rent, pay medical bills, and save up for retirement expenses.

[drivebyhooting]

If you’re gonna have kids, fussy means: * have decent schools * not covered in lead or asbestos * not next to a highway

[qurren]

+

* in an area not going to get shot or mugged

* structurally earthquake safe so that we don't die

[tenuousemphasis]

Globally, $14k/mo is unbelievably, obscenely rich.