Author Topic: Average Rent For A Studio In San Francisco: Over $2,300 A Month  (Read 6220 times)

dragoncar

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http://www.socketsite.com/archives/2013/08/average_rent_for_a_studio_in_san_francisco_is_over_2300.html

The comments are ridiculous (although plenty of level headed people too):

Quote
Post-taxes, health care, etc., our 650k is more like 350k.
Call it $50k saved to dedicated retirement accounts plus $100k of plain vanilla savings. And then $200k of spending, all-in. Really, it's probably more like $180 spent and an additional $20k saved. Still obviously more than most can do, but our lifestyle is much closer to a family making $300k/year than it is to a family making $2M a year.
We take two nice-but-not-four-seasons-nice 1-week vacations a year, our kids are in public school, we own used cars that we paid less than $20k total for, and we rarely eat out. And we both work. A lot. Hardly the lifestyle of a "very rich" family.

How do you spend 16k/mo if you rarely go out to eat, own used cars, and take non-lavish vacations?

Rural

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #1 on: August 06, 2013, 06:37:58 AM »
It's all about perspective. The average monthly payment on a studio apartment in San Francisco is nearly 6% of what my total mortgage was.

mgreczyn

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #2 on: August 06, 2013, 02:05:27 PM »
My favorite comment-er on that thread is living on 110k in a house they bought 18 years ago that they owe $80k on... that's apparently worth $1.25 million.  For the love of all things holy, SELL IT AND IMMEDIATELY RETIRE SOMEWHERE ELSE.

Undecided

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #3 on: August 06, 2013, 02:22:27 PM »
My favorite comment-er on that thread is living on 110k in a house they bought 18 years ago that they owe $80k on... that's apparently worth $1.25 million.  For the love of all things holy, SELL IT AND IMMEDIATELY RETIRE SOMEWHERE ELSE.

Why?

DCUrbanMM

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #4 on: August 06, 2013, 02:36:26 PM »
My favorite comment-er on that thread is living on 110k in a house they bought 18 years ago that they owe $80k on... that's apparently worth $1.25 million.  For the love of all things holy, SELL IT AND IMMEDIATELY RETIRE SOMEWHERE ELSE.

Spot on! 


Mr.Macinstache

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #5 on: August 06, 2013, 02:39:29 PM »
I saw a 2bed 1 bath rent sign for $450 and I thought that was high... but I don't live in a glamorous big city.

yahui168

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #6 on: August 06, 2013, 02:43:32 PM »
I live in the SF area and I think most of the comments are ridiculous. We have a household income of 270k/yr and according to those comments I'm near poverty level.* The comments mistake income vs asset. These people are income rich but asset poor and buying everything on finance. I have about 1.3m in net assets.* I'm pretty sure these people don't know how to save money. I moved recently and my expenses have been high but I've been saving for +15 years. In college, I was making $8/hr and saving it so I can have $2k (min balance) to open an investment account. My wife and I shared one car for about 10 years. About 7 years ago, we moved from a condo to a single family home. Our household income at that time was 400k/yr but we opted to buy a home that leaves us with a 400k mortgage so we can save the difference. My wife and I scaled back our work to spend more time with our daughter which leaves us with 270k/yr which is still a ridiculous amount of money. Our needs are met 10x over and we have the time to enjoy it. Even with our high income I'm still looking for the great tips and motivation on this website to maximize savings. We switched to prepaid cell, a cheaper cable plan, etc.

* Most people have a awkward time of talking about finances because much of our society equate wealth with self worth. I have high income and proportional expenses but that does not make me good or evil, better or worse than anyone else. The important thing is to be self aware. Have a nice beer with your dinner, just be aware what you're paying vs. what it's worth to you.

Jamesqf

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #7 on: August 06, 2013, 06:04:11 PM »
My favorite comment-er on that thread is living on 110k in a house they bought 18 years ago that they owe $80k on... that's apparently worth $1.25 million.  For the love of all things holy, SELL IT AND IMMEDIATELY RETIRE SOMEWHERE ELSE.

Why?  Assuming, of course, that they like living in San Francisco.  (Can't understand it myself, but apparently some people do.)  Possibly they enjoy their work there, have friends/family, etc.  So if they stick around, they are presumably earning SF-level incomes, but not paying much for housing, while the house is likely to appreciate even further.  Maybe in 5 years, they'll have the mortgage paid off, and could sell the house for $2.5 million.

ocandelario

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #8 on: August 06, 2013, 06:44:22 PM »
I saw a 2bed 1 bath rent sign for $450 and I thought that was high... but I don't live in a glamorous big city.

Where was this rental?  I wish I could find a 2bd/2ba for $450...

dragoncar

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #9 on: August 06, 2013, 06:49:47 PM »

* Most people have a awkward time of talking about finances because much of our society equate wealth with self worth. I have high income and proportional expenses but that does not make me good or evil, better or worse than anyone else. The important thing is to be self aware. Have a nice beer with your dinner, just be aware what you're paying vs. what it's worth to you.

Speaking of which, I'm gonna go get a $2.50 pint of Lagunitas downstairs in downtown SF.  Things don't have to be spensive.  Anyone else want to come?

If I had a pricey house in SF with a low tax base, no way I'd sell.  Reverse mortgage pershnaps.

mgreczyn

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #10 on: August 07, 2013, 10:22:30 AM »
My favorite comment-er on that thread is living on 110k in a house they bought 18 years ago that they owe $80k on... that's apparently worth $1.25 million.  For the love of all things holy, SELL IT AND IMMEDIATELY RETIRE SOMEWHERE ELSE.

Why?  Assuming, of course, that they like living in San Francisco.  (Can't understand it myself, but apparently some people do.)  Possibly they enjoy their work there, have friends/family, etc.  So if they stick around, they are presumably earning SF-level incomes, but not paying much for housing, while the house is likely to appreciate even further.  Maybe in 5 years, they'll have the mortgage paid off, and could sell the house for $2.5 million.
Absolutely, they could definitely do that.  My response to that plan would be to ask if they're FI outside of the house. If it were me, and the answer was no and I was sitting on an asset that I could sell and net 7 figures, I would sell that beast in a heartbeat.  As for SF real estate prices doubling in 5 years, is it possible?  Sure, anything's possible but call me a skeptic.  I guess having never lived anywhere more than 3 or 4 years I can't square up sacrificing immediate FI for a chance to live in a particular spot.

Undecided

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #11 on: August 07, 2013, 10:51:18 AM »
My favorite comment-er on that thread is living on 110k in a house they bought 18 years ago that they owe $80k on... that's apparently worth $1.25 million.  For the love of all things holy, SELL IT AND IMMEDIATELY RETIRE SOMEWHERE ELSE.

Why?  Assuming, of course, that they like living in San Francisco.  (Can't understand it myself, but apparently some people do.)  Possibly they enjoy their work there, have friends/family, etc.  So if they stick around, they are presumably earning SF-level incomes, but not paying much for housing, while the house is likely to appreciate even further.  Maybe in 5 years, they'll have the mortgage paid off, and could sell the house for $2.5 million.
Absolutely, they could definitely do that.  My response to that plan would be to ask if they're FI outside of the house. If it were me, and the answer was no and I was sitting on an asset that I could sell and net 7 figures, I would sell that beast in a heartbeat.  As for SF real estate prices doubling in 5 years, is it possible?  Sure, anything's possible but call me a skeptic.  I guess having never lived anywhere more than 3 or 4 years I can't square up sacrificing immediate FI for a chance to live in a particular spot.

Knowing nothing about their jobs or any other aspect of their lives, it seems like a stretch to presume they should sell. At some level, the "independence" in FI must mean "independence to do what one wants," right?

Mr.Macinstache

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #12 on: August 07, 2013, 11:15:05 AM »
I saw a 2bed 1 bath rent sign for $450 and I thought that was high... but I don't live in a glamorous big city.

Where was this rental?  I wish I could find a 2bd/2ba for $450...

2 bed / 1 bath. Small, but nice clean town in middle Missouri. Cost of living here is fairly cheap.

Jamesqf

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #13 on: August 07, 2013, 11:48:59 AM »
I guess having never lived anywhere more than 3 or 4 years I can't square up sacrificing immediate FI for a chance to live in a particular spot.

I'm just the other way around.  I could have made, and be making, a heck of a lot more money (even after housing costs) if I'd been willing to live permanently in a place like the Bay Area

mgreczyn

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #14 on: August 07, 2013, 11:49:34 AM »
My favorite comment-er on that thread is living on 110k in a house they bought 18 years ago that they owe $80k on... that's apparently worth $1.25 million.  For the love of all things holy, SELL IT AND IMMEDIATELY RETIRE SOMEWHERE ELSE.

Why?  Assuming, of course, that they like living in San Francisco.  (Can't understand it myself, but apparently some people do.)  Possibly they enjoy their work there, have friends/family, etc.  So if they stick around, they are presumably earning SF-level incomes, but not paying much for housing, while the house is likely to appreciate even further.  Maybe in 5 years, they'll have the mortgage paid off, and could sell the house for $2.5 million.
Absolutely, they could definitely do that.  My response to that plan would be to ask if they're FI outside of the house. If it were me, and the answer was no and I was sitting on an asset that I could sell and net 7 figures, I would sell that beast in a heartbeat.  As for SF real estate prices doubling in 5 years, is it possible?  Sure, anything's possible but call me a skeptic.  I guess having never lived anywhere more than 3 or 4 years I can't square up sacrificing immediate FI for a chance to live in a particular spot.

Knowing nothing about their jobs or any other aspect of their lives, it seems like a stretch to presume they should sell. At some level, the "independence" in FI must mean "independence to do what one wants," right?
Well yeah, with the limitations imposed by the "F" that comes before the "I".  We're all "I".  I could quit my job and move to Moscow tomorrow, but for certain other limitations on my life, one of them being the "F" part.  But sure, they're free to do whatever they please.  Hence all the stuff in my post about this being what I would do.  Me, I would sell yesterday.  Also, we do know something pretty significant about their lives: they bring in $110k as a household.  I don't live in SF, but based on what I've read and heard that seems like pretty small potatoes for that area, raising at least the possibility that the $1.25 million house is their largest asset by far.  Again, RAISING THE POSSIBILITY, not saying for certain.  Again, just so we're clear: I'm not telling anyone to sell a house.  It's just what I would do in their shoes.

Rural

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #15 on: August 07, 2013, 11:56:10 AM »
I guess having never lived anywhere more than 3 or 4 years I can't square up sacrificing immediate FI for a chance to live in a particular spot.

I'm just the other way around.  I could have made, and be making, a heck of a lot more money (even after housing costs) if I'd been willing to live permanently in a place like the Bay Area

I'm in a similar situation. And I wouldn't sell this place (house and land) for any price. Some things are worth more than money. ( The barn I'd probably let go for the right price. :-) )

Wouldn't be in SF for me (though I actually do love that city and would like to visit again), but money's a tool for facilitating what you consider to be a good life. It's not an end unto itself, so I could easily see keeping a house in SF if you can afford it and living in SF is part of your good life.

mgreczyn

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #16 on: August 07, 2013, 11:57:37 AM »
I guess having never lived anywhere more than 3 or 4 years I can't square up sacrificing immediate FI for a chance to live in a particular spot.

I'm just the other way around.  I could have made, and be making, a heck of a lot more money (even after housing costs) if I'd been willing to live permanently in a place like the Bay Area
Sure, that makes sense.  I could possibly do the same thing, though I think we'll do pretty well income wise where we are now and the start up would be financially very difficult.  All I was trying to say was that if I were given the option to be financially independent tomorrow, and all I have to do is sell the house I'm living in right now and move to a lower COL area, I would do it.  For example, if I lived in a 1.25 million house in SF making $110k per year, I could quit my job, sell that house and even after transaction costs buy the house I am living in right now outright and never work another day in my life.  That's totally different from saying that I could move to San Francisco permanently and net a lot more money over the next 10 years compared to staying here.

Undecided

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #17 on: August 07, 2013, 02:47:18 PM »
Well yeah, with the limitations imposed by the "F" that comes before the "I".  We're all "I".  I could quit my job and move to Moscow tomorrow, but for certain other limitations on my life, one of them being the "F" part.  But sure, they're free to do whatever they please.  Hence all the stuff in my post about this being what I would do.  Me, I would sell yesterday.  Also, we do know something pretty significant about their lives: they bring in $110k as a household.  I don't live in SF, but based on what I've read and heard that seems like pretty small potatoes for that area, raising at least the possibility that the $1.25 million house is their largest asset by far.  Again, RAISING THE POSSIBILITY, not saying for certain.  Again, just so we're clear: I'm not telling anyone to sell a house.  It's just what I would do in their shoes.

I understand you're saying it's what you would do, it just strikes me as odd, knowing they've owned a house there for 18 years, not to consider that they (and indeed you, if you were in their situation) might have family, friends, enjoyable work and "lives" there. In viewing others, this board tends to fit Oscar Wilde's definition of a cynic.

mgreczyn

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #18 on: August 07, 2013, 02:51:03 PM »
Well yeah, with the limitations imposed by the "F" that comes before the "I".  We're all "I".  I could quit my job and move to Moscow tomorrow, but for certain other limitations on my life, one of them being the "F" part.  But sure, they're free to do whatever they please.  Hence all the stuff in my post about this being what I would do.  Me, I would sell yesterday.  Also, we do know something pretty significant about their lives: they bring in $110k as a household.  I don't live in SF, but based on what I've read and heard that seems like pretty small potatoes for that area, raising at least the possibility that the $1.25 million house is their largest asset by far.  Again, RAISING THE POSSIBILITY, not saying for certain.  Again, just so we're clear: I'm not telling anyone to sell a house.  It's just what I would do in their shoes.

I understand you're saying it's what you would do, it just strikes me as odd, knowing they've owned a house there for 18 years, not to consider that they (and indeed you, if you were in their situation) might have family, friends, enjoyable work and "lives" there. In viewing others, this board tends to fit Oscar Wilde's definition of a cynic.
As mentioned by a couple of others, different strokes I guess.  The reality of living somewhere for 18 years just doesn't compute for me.  Not that it's unattractive, it's actually what I hope to accomplish over the next 18 years... just that I've never experienced it so wouldn't know how to judge the downside. 

Tyler

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #19 on: August 07, 2013, 11:31:55 PM »
I'm just the other way around.  I could have made, and be making, a heck of a lot more money (even after housing costs) if I'd been willing to live permanently in a place like the Bay Area

For me, moving to the Bay Area really jump-started my salary.  But leaving the Bay Area last year kicked my savings into high gear (even with a pay cut).  Sometimes timing plays a factor.

BTW, I can absolutely vouch for the fact that San Francisco exists within a reality distortion field when it comes to money.  Lots of people who would be completely out of touch with fiscal reality anywhere else.

Undecided

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Re: Average Rent For A Studio In San Francisco: Over $2,300 A Month
« Reply #20 on: August 08, 2013, 10:21:01 AM »
I'm just the other way around.  I could have made, and be making, a heck of a lot more money (even after housing costs) if I'd been willing to live permanently in a place like the Bay Area

For me, moving to the Bay Area really jump-started my salary.  But leaving the Bay Area last year kicked my savings into high gear (even with a pay cut).  Sometimes timing plays a factor.

BTW, I can absolutely vouch for the fact that San Francisco exists within a reality distortion field when it comes to money.  Lots of people who would be completely out of touch with fiscal reality anywhere else.

Reality is local.