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Salary needed to buy a home in San Francisco: $161,000

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Up $24,000 since 2014

Apartments on a San Francisco hillside. Photo by Bertl123

The mortgage site HSH again calculated how much money the average homebuyer should make to get by comfortably in major American cities this week.

The report delivered rough news for San Franciscans, but it gets even worse when compared with previous years.

The predictable bad news: HSH once again found San Francisco housing stock to be the least attainable in the nation. By the company’s calculations, with a 20 percent down payment and a 4.36 percent mortgage rate it takes over $161,000/year to afford “afford the principal, interest, taxes and insurance payments on a median-priced home” in the city.

Note that HSH is actually counting the larger San Francisco-Oakland-Hayward census area (consisting of San Francisco, Alameda, Marin, San Mateo, and Contra Costa counties) rather than just the city itself, yielding a median home price of $815,000.

A median home in the city costs far more than that, of course, but San Francisco buyers are probably also more likely to accept greater housing cost burdens beyond what firms like HSH consider affordable (roughly one third of monthly income).

Naturally, the San Francisco figure is HSH’s highest in the nation, as it has been the last 16 times the firm did this same quarterly exercise.

But the real kicker here is that the same time in 2016, HSH calculated that a salary of just $144,000 would be sufficient. In 2015, it was $141,000. And in 2014, a comparably frugal $137,000.

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The huge 12-plus percent year over year increase since 2016 is typical of other cities surveyed in the same report, many of which are eating double-digit hikes too.

“There were increases in tax and insurances costs, and that’s a portion of it,” HSH Vice President Keith Gumbinger tells Curbed SF. “But if you look at what’s happening, it’s hard to get away from the fact that the price of homes sold is up every year, and that’s a kicker to start with.”

The price of a home in San Francisco actually rose less in 2016 than in previous years, but Gumbinger points out that this fact itself can reflect rises in neighboring cities in the metro area.

As usual, it’s wise to take these kinds of reports as signposts rather than gospel truths, as other sources may calculate different but theoretically equally sound median home prices, recommended salaries, and housing cost schedules with different methods.

Nevertheless, the fact that one source using the same method consistently over many years reports a constantly rising tide of expense on top of a startling recent spike remains sobering.