The tech industry. Over and over in recent years, this economic sector has been targeted as the cause of dramatic upticks in both home prices and rents in the Bay Area.
But is this a fair accusation? Apparently so, according to a new Zillow study. “[This analysis] highlights the widening wealth gap between tech company employees and other U.S. workers – a gap that is putting increasing pressure on housing markets where tech companies are booming,” said Zillow chief economist Dr. Svenja Gudell.
Facebook, Apple, Google and home ownership
First off, home values: Data show that Google, Facebook and Apple employees live in pricier homes than other Bay Area workers and have faster home value growth as well. In fact, the average Apple worker now lives in a home that is more than five times more valuable than the average U.S. home, according to Zillow.
Using census data, Zillow found the “typical worker at Apple’s Cupertino, Calif., headquarters lives in a home that is worth about $1.14 million, about $241,000 (27 percent) more than the median home in the already-pricey San Jose metro area and $380,000 (50 percent) above the median home value in the San Francisco metro area.”
Apple’s not alone. Workers at Google and Facebook headquarters — in Mountain View and Menlo Park respectively – live in more valuable homes as well. The median home value among Facebook workers is $1.25 million; among Google workers, it’s $1.28 million.
Zillow used data from the U.S. Census Bureau tracking where workers live and work across the Bay Area, then combined that data with Zillow’s Living Database of All Homes to compute a median home value for workers at the Apple, Google, and Facebook campuses in the Silicon Valley. Boiled down, the information shows:
- On average, employees of Google, Facebook and Apple live in homes with a median value of well over $1 million.
- Homes rented or owned by employees of these three tech companies are worth more than surrounding homes and are appreciating more quickly than surrounding homes
The gap, just like the iPhone, is getting bigger:
The gap between tech employee home values and those of surrounding areas has grown larger. Apple workers’ home values took off after the first iPhone was released in June 2007. Apple’s stock price rose, increasing the wealth of many employees and cementing the company as one of the most successful in the world. Prior to summer 2007, the typical Apple worker lived in a home that was 13 percent more expensive than the typical San Jose home; since summer 2007, that gap has widened to 20 percent.
As recently as 2010, homes in the neighborhoods where Apple workers lived were worth only three times the national median. Now they are worth five times that median.
Apple’s gains are the most dramatic, likely thanks to the iPhone. In the same period, the typical Google employee went from living in a home that was 37 percent more expensive than the average San Jose home in 2007 to living in one that is now 39 percent more expensive. For Facebook employees, the gap went from 31 percent to 33 percent.
San Francisco metro highlights
Other interesting (and possibly troubling) local findings point to recently inflated housing prices in all areas in the San Francisco metro, including rent:
- Condos have appreciated 13.5 percent over the past year
- Single-family homes have appreciated 12 percent over the past year
- Rent has gone up 13.3 percent over the past year
The takeway
Probably the only thing we didn’t already know here is just how much and how deeply the tech boom has impacted local real estate. If you’re qualified to work for these companies, you’re likely qualified to buy and/or rent homes nearby. Other people, however, may be thoroughly priced out.
Anna theOnThe Block blog, Marie Erwert
http://blog.sfgate.com/ontheblock/2015/11/02/new-study-shows-profound-impact-of-tech-industry-on-bay-area-real-estate/
No comments:
Post a Comment