Author Topic: Question about Bay Area rents - what is a Mustachian reasonable amount to pay?  (Read 2351 times)

carozy

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Born and raised here, so I'm used to the shock of high rents.  Not ready to leave friends and family just yet either for a lower cost of living area that is too far away to visit them easily, and also shifting career-wise to get into tech and command a higher salary.

My current rent is $980 which includes all utilities = $11,760 per year.  It's month to month, a flat with one roommate (separate bedrooms), and we get along well (mutually respective, clean, etc.).  I do also contribute evenly to household shared goods like tp, paper towels, etc.  Previously I was paying $800 plus utilities (shared) and moved relatively quickly after a break up, so I've only been here a few months.

I was reviewing the reports feature in YNAB and trying to lower my overall expenses.  I don't feel like I'm struggling to make this rent (it's about 27% of my take home pay), and for now I'm happy with where I live (close to work, OK neighborhood).  But thinking long term, I'm feeling maybe I should try to get something better to speed up my fire date.  I'm thinking maybe I'll move if I lose my job (security is shaky as company is being bought right now) with the motive to find lower rent and close to my next work.

Just wondering what other Mustachians feel is a reasonable rent to pay in the Bay Area (either as rent in dollars or as percent of take home pay)?  Do I have it good at $980 (including utilities) for my clean, spacious bedroom in a modern condo with compatible roommate, close to current job?  Should I look harder if/when I feel inclined to move for a cheaper gem somewhere in my hometown area?

I would appreciate your insights, thanks.

affordablehousing

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Sounds darn cheap to me, especially for a condo setting. The point of FIREing in the Bay Area is making a ton of money, which should easily outweigh the real estate costs. Friends that do those 10 week coding bootcamps are being hired at $110K, which I think gives a pretty good launch pad to be comfortable. I'd stick with the place you're in.

webguy

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Sounds like a great deal based on where you're at and that it ticks all your boxes. I was paying about 1100/month for a 1 bedroom apartment just outside Minneapolis so it seems very low for your area. If you were unhappy I'd say maybe look around, but you're not so I'd stay put and try to optimize elsewhere. A good living situation contributes greatly to your happiness level.

cchrissyy

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that sounds VERY inexpensive for 1 bedroom. is this in the city?  I know people who pay a bit more than twice that for the same situation in SF, having one roommate in a decent 2br apartment, not the cheapest building in town but nothing fancy either.

also, it's cool that you're month to month so if your job changes you can move close to it.
« Last Edit: August 17, 2017, 12:30:20 PM by cchrissyy »

forumname123

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I've been in the bay area for about 2 years, and I think that's the lowest rent I've heard of for a single person (roommate or not). The next lowest is the $1000/month that my friend pays, but he has... 10 roommates.

carozy

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I've been in the bay area for about 2 years, and I think that's the lowest rent I've heard of for a single person (roommate or not). The next lowest is the $1000/month that my friend pays, but he has... 10 roommates.

Wow, this is the highest rent I've ever paid and I have lived here all my life.  I've always had roommates or family though, and have lucked out with good situations (drama free).

My rent history:

Moved out in 2005: $425 for room with 3 roommates, SF, near beach, park, rent control (lucked out getting that even then as I knew one of my roommates)
Stayed 8-9 years there, by the time I left, my rent was up to $538 for a room at the same place for twice the space
2014-5: stayed with parents to save up to pay off credit card bill (~$3K) and medical bill (~$11K)
2016-17: $375 (ex had rent control 1 bedroom) up to $800 with ex (we split based on % of our incomes)
Now: $980 with roommate, includes utilities

I feel like I've seen cheaper rents occasionally on Craigslist, but for where I was looking (close to my work) I've seen at least $800 + utilities on the low end back when I was looking.

carozy

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Sounds like a great deal based on where you're at and that it ticks all your boxes. I was paying about 1100/month for a 1 bedroom apartment just outside Minneapolis so it seems very low for your area. If you were unhappy I'd say maybe look around, but you're not so I'd stay put and try to optimize elsewhere. A good living situation contributes greatly to your happiness level.

I think you make a good point.  For now I'm happy with it, and I'll look elsewhere to optimize (like food expenses).  I will re-evaluate if I lose my job or after maybe another year.

that sounds VERY inexpensive for 1 bedroom. is this in the city?  I know people who pay a bit more than twice that for the same situation in SF, having one roommate in a decent 2br apartment, not the cheapest building in town but nothing fancy either.

also, it's cool that you're month to month so if your job changes you can move close to it.

It's in East Oakland.  The area I'm in feels safe enough (near Laurel Village).

Sounds darn cheap to me, especially for a condo setting. The point of FIREing in the Bay Area is making a ton of money, which should easily outweigh the real estate costs. Friends that do those 10 week coding bootcamps are being hired at $110K, which I think gives a pretty good launch pad to be comfortable. I'd stick with the place you're in.

I'm making may way through freeCodeCamp and also looking into User Experience Design path on Lynda.com.  I've looked into boot camps but not ready to sink money into them when there are so many good free education resources available.

Eric

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It's a good price.  Don't rock the boat on this one.

carozy

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It's a good price.  Don't rock the boat on this one.

OK, thanks, good to get other people's feel for it.  Thought it was a good deal too, especially as it fits my life circumstances right now.  I've lived happily in smaller places with more (but good) roommates but since it's close to work, I'll hold off before I make any big moves. 

affordablehousing

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Yeah, I think you should just work on making more money. The only people making under $100K in the bay area are non-profit workers.

carozy

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Yeah, I think you should just work on making more money. The only people making under $100K in the bay area are non-profit workers.

I know higher salaries are more common around here, but I wouldn't say only non-profit workers make less than $100K.  Found an article that discusses this: http://www.mercurynews.com/2015/06/23/wages-in-bay-area-outstrip-national-average/

Teachers, office workers, service workers, blue collar workers, even nurses - getting to $100K takes experience, expertise, strategic job hopping/good negotiating, years, and adding great value to your position (and working for a company/industry that can support that).  My ex was a teacher at a private school (higher salaries), and while she made a lot, she was still under 6 figures after 14 years experience in that position.

My feeling is that the tech salaries are in the $100K range for those with experience (but not for juniors/those starting out in tech unless they are extra specialized).  Other workers (other industries) do have higher than average salaries, but I would not say they all make at least or more than $100K.  The trade off is a high cost of living location (definitely in rents/real estate).  Having done payroll and accounting for two different industries at least, I would say the majority of workers did not make 6 figures (and most, not even close).

I also just recently read an article about how rent/real estate is so high in the Bay Area that there's actually more jobs than workers, because they can't afford to live here for the pay rate.  It's mentioned in this NY Times article about a commuter who gets up at 2:15am in Stockton to take 2 trains and a bus to get to work in SF by 7am: https://www.nytimes.com/2017/08/17/business/economy/san-francisco-commute.html

EDIT: added some details
« Last Edit: August 18, 2017, 11:33:44 AM by carozy »

affordablehousing

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that's true, I shouldn't have been so glib. apologies for generalizing.

carozy

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that's true, I shouldn't have been so glib. apologies for generalizing.

Well you do make a good point though, I do need to make more $!  Since I do live here and want to continue living here.