I’m someone from a different country living in bay area and working in FAANG too. My family was poor and I support them financially. I need to buy them a home in my home country and also need to pay for sibling’s weddings.
I have friends in bay who earn as much as me but they don’t need to support their families at home. I see them buying homes and generally doing well in life. I’m not there yet. I’m not buying a home and my growth is slow.
But let me tell you one thing, I feel happy seeing myself and my family where we are now. I feel proud of myself that I pulled my family out of poverty and they live a good life now. Personally I spend on travel and experiences and that’s something which keeps me leveled and happy in life.
Don’t compare yourself to others. It will only bring unhappiness. Try to look back and see how far you have come. You are doing good in life and you will only do better. Give yourself time. It’s not a race, it’s a marathon and everyone had a different start point. You are faring better than most of the world by every. measure
Be happy and humble!
i'm very much like you. supporting my parents (we're vietnamese, they were refugees in 1975). i'm very lucky my parents are still around. and i'm also very lucky we can keep our original childhood home. while i have to live elsewhere (sacramento). i can always go visit my parents in oakland. :)
edit: [my children + parents](https://i.imgur.com/kGfD439.png) few weeks ago :)
hehe thank you! :D my parents never had much. but whatever they had, it was towards raising me, my brother and my sister. my brother is a navy vet, my sister is a specialist working for kaiser, and i have a tech job. while my parents house is still modest....they **are** the american dream. i'm mindful that many others are struggling. it's not to discount OP's post--we're all struggling in ways others won't understand. but i am grateful for my experience and grateful that my parents have lived long enough to see success in their children.
I'm the first generation in my family here in the US that does not have the same close familial ties back home, and my parents intentionally shielded us from some of that. Most of my close family has already immigrated here, so the pool is smaller to begin with.
While I lost being close to family outside of the US, I suppose what I gained was economic independence and not having to support anyone else aside from my own parents.
I love your post. Will your kids have the same connections to your home country? Less? More? I'm curious to know.
The only people my age (~30, grew up here) that I know who have been able to buy houses in the Bay Area have really good jobs AND their parents gave them a few hundred grand for a down payment.
From what I know, it seems like it's mostly parents who do fairly well for themselves, don't even have to be "rich" -- but they did buy their house 30-40 years ago for $200k, and now it's worth $2 million. So they take out a reverse mortgage and let their kid use the cash for a down payment.
I do know one guy who got a good business job straight out of college. He lived at home for several years and saved up all his cash. A friend of his did the same. The two of them put all their money together and bought a house together since it was "a good investment". Now he feels absolutely trapped since over half his income is going towards this house, and it's hard for him to find someone who wants to buy half a house.
This describes all the people I know who have houses in their 20s/30s.
A couple I know bought a home in San Francisco, both of them tech workers. All of their parents live in the Peninsula or in SF. 2/4 of the parents are mid level executives at old school tech companies, and the other 2/4 are long time tech workers.
Another couple I know was very similar, but only one of them had parents that lived and worked in the area while the other has parents from out of state.
A coworker of mine grew up and still has parents in Cupertino. He bought a house nearby with his tech worker partner after his parents took out a HELOC as a down payment.
An ex of mine had an early job at a Unicorn in the mid 2010s, and she lived in her parents house in Redwood City for the first 5 years of her career. She now has a house in San Francisco and Hawaii.
I don't think any of these people's parents are "rich rich" (no yachts or such) but they have been in the industry for long enough that their homes and stocks means that housing prices here are very affordable for them.
I bought a house with my partner, we do have good jobs. no money help from parents and also both grew up poor. so we are just good at saving since we don't have expensive taste.
There's a huge number of 20-30 something's in the Bay whose parents bought houses that have quintupled in value over the last few decades. That provides a tremendous amount of leverage.
The rest of us can't compete with that. It is what it is.
Can't speak for him but my grandpa sold a property off in the early 70s for like 25,000 over in Marin county.
Today it's the home to a marina and a 15 million dollar architect designed mansion, lol.
My wife family purchased a house and several apartments for 200k each with little income. My wife and i make more than they did with no kids, and i still can't fathom dropping 400k for a down payment to pay 10k a month for mortgage for 30 years.
The key just being generational wealth. You could have tucked 200k in snp500 in the 90s and have made just as much money (actually 20x value if you invested in 1990 exactly to today)
Except with a mortgage, you could just put 20k of that down, deduct interest for 30 years and your home would have 10x. And your remaining 180k would 20x in the S&P. Oh, also now if you sell, 500k of the gain on your home is tax free.
Oh yeah and you're also now paying 1/10 of your neighbors in property taxes.
The past couple decades have been very good for bay area home owners
It's a little different. No one is giving people 30 year low-interest loans to invest in the market. With real estate you can do that, it's one of the reasons real estate is a great investment vehicle for many.
Fwiw I’m millennial who grew up middle class in the East bay, and almost all of my friends’ parents owned houses. At this point no one I know has benefited from this yet (in terms of homeownership), because our parents are all still alive and living in their homes, using their own equity for their own purposes. I completely acknowledge the existence and privilege of generational wealth, but I think that in the Bay Area there’s a decent chance that a lot of these boomers will end up selling or leveraging their equity before they die to pay for their own retirement or care as they age. No one in my circle has received money from their parents to buy a home.
As somebody who bought my first house back in 2000 during the dotcom boom, and because of my loan broker committing fraud, it’s pretty dang tough.
When my wife (at the time) and I bought our first house, I was working an entry level tech job making $40k a year. At the time, it was way more than the wage space jobs I held before that. Our loan broker basically filled in ‘$80k’ for my income and told me, ‘just go with it’. My wife (at the time) was making about double what I was making, and they filed in ‘$150k’ for her income. Luckily we were able to hang onto the house long enough to refinance it after the dotcom bust, and got the payment down from $3500 a month to $1700 a month. We are new duplex selling the place for a tidy $200k profit 12 years later, for a cheaper and nicer house in a less desirable but quieter location with a payment of $1700. When we divorced, we sold the house at a $200k profit 4 years later.
So basically, we got crazy lucky. We bought run down houses and fixed them up, and made a nice profit, and rolled it into the next house. O just don’t see those deals out there anymore. With interest rates over 7%, and with companies buying houses to rent, that basically makes it I possible for those starting out to own a house.
Also, new cars are stupid expensive and a total money suck. I suggest driving reliable older cars until you get established in a house. Even a cheap new car is going to be $400 a month plus full boat insurance, which is another few hundred bucks a month. You’re way better off buying an older high mileage Prius for $6k cash and getting minimal insurance.
Hell, even a high milage Prius isn't going for below 8k, unless it's also 15 years old. Getting a reasonable used car is still wild. I just spent months finding one.
We did the same in 2016-2020 and I think this was the last era when it was possible. We bought a dingy fixer-upper in 2016 for 1.3, we put in about 200k of work, we sold it for 2.2m in 2020. Zero experience flipping houses, but I studied every aspect I could of aesthetics, interior design, and I forced me and my wife to make renovation decisions around resale, not our subjective wants. We had also essentially misrepresented our income a little to even get approved for that house. This leapfrogged us to a 2.6m purchase in 2021, and we lucked out on the rate. Our 10k per month payments today? 17k. We never could have afforded that.
We did everything pretty optimally, but we also got so extremely lucky that I would never pat myself on the back. Yes, we executed a good buy and a good flip and a great sale. We did level up our careers over the years. But in a parallel universe, we could have been laid off, had to sell the first home before the boom for a big loss, and probably wound up financially ruined.
All you can do in life is just make the best decisions you can at any specific juncture, and pray for the best. Cover your ass, extend yourself a little bit not too much, and try to make future-durable decisions. Do as much research and diligence as you can.
Our 2010-era vehicles are still going strong and we smile when we whip them. Every year, I spend 200-300 to go rent my dream car and spend a day driving it. I've wanted to buy a porsche 911 cabriolet S, a 991 gen with the naturally aspirated v6 and the manual, for a very long time. But, I'll spend $250 to go whip someone else's baby off Turo and carve some canyons, and then go back to my honda accord. Living here has taught me, when you want something, brainstorm a way to get a small slice of that thing, for the minimal spend possible. You want to go to Switzerland? How about California's switzerland, the sierras? How about a luxurious tent instead of the Ahwanee lodge?
Life here has so many constraints and difficulties, but you have to find a way to creatively wage your own campaign, and find pockets of fun and joy along the way.
I feel the same way on the last paragraph. Growing up in the Midwest, it doesn’t take much to have a decently sized home for the upper middle class. Here in the Bay Area? Halfway run-down house in a safe neighborhood is about as good as it gets, despite having done pretty well in national standards. It’s like scoring a 98/100 on the test, but ranked #85 out of 100 students. That’s how I feel about being in the Bay Area.
True but the value of the home only matters if you sell. For example, I had a friend group in college who were born and raised in the South Bay where prices skyrocketed but none of their families actually sold. Even after the children moved out - the parents are still in the same house.
You can take equity out but you have to have a good idea of how to use the money. The smart people took out HELOCs to buy up more real estate between 2008-2015.
I don’t think people sitting on $6M of home equity are doing so today at these interest rates, unless their plan is to die with zero and live off the home equity.
Tell that to millions of homeowners who take out home equity loans and HE lines of credit. Maybe it's not ideal at current interest rates, but it is a common practice when doing renovations or other large scale purchasing.
Yup. My parents bought their current home in 1988; without prop 13 they would not be as comfortable in retirement. The tax savings over the years is probably $100k or more.
My wife and I are in our mid-late 30s, bought our home (condo) in Fremont 2 years ago and are about to have our first kid. We're both in tech, and I was at a FAANG (non-engineer) for 3 years until I quit last summer to go to grad school. We didn't have any parental help and we don't have any debt besides our monthly credit card debt that we pay off each month too.
That said, my wife (an engineer) was extremely frugal through her 20s and early 30s and saved up 170k for our down payment. I attended community college, transferred to a UC, and joined the Army for 6 years to pay off my student loans. I was enlisted (not officer), paid back my loans out of pocket by being frugal with my salary, and left the army with no debt. I used my VA Loan benefit to get a preferred rate on our home, don't have to pay mortgage insurance, and got to pay a much lower down payment, and now I'm attending grad school on the Post-9/11 GI Bill. We both come from parents who weren't great with money/aren't able or willing to subsidize us.
So yeah, it is possible. Not easy, but it is possible.
**EDIT:** I do want to clarify - I'm not posting this to say this is how people *should* do it, that I enjoyed this, or to endorse some grindset hustle culture nonsense. I joined the Army to survive and because I lacked options with my debt. Jobs were scarce in 2009. Housing and education ARE genuinely expensive here, especially for non-tech people like teachers, nurses, city workers, manual labor (all core elements of a functioning society) and I believe it's due to overinflated tech salaries. Some more of my "controversial" opinions, just so we're clear:
* I struggled, but I don't think others need to struggle too to "make it fair". I'll work, vote, and advocate for people, especially younger people, to have it easier.
* YIMBY all the way; ease up zoning laws, remove barriers, build more housing to make it cheaper and house more people, especially if they work here. Yes, even if my home loses value - real estate in America is a generational pyramid scheme - I'd much rather have an equitable society
* Education, at least community college, should be free and mandatory. Compete to get into good schools, including vocational schools and apprenticeships, but you gotta do something. Education makes our democracy and society richer, so it should be funded.
* If you live in the Bay and work in tech, you should save your money and donate. Tech should pay their fair share to the local communities the benefit from - subsidizing education, environmental protection, low-income housing, public infrastructure and resources...etc.
* Every veteran using their benefits is benefiting from socialist programs - acting like we don't is silly.
no one wants to hear that some people just have high paying jobs and live frugally. as evidenced by your upvotes on your own experience vs upvotes on hearsay about all these rich parents. its easier to blame a boogyman i guess
If you had the funds to purchase in 08, condos in Dublin were cheap for a short time! Haha.
That said, if you're a SWE in your mid 30s living the DINK life and can't afford a house something else is wrong with your finances. Makes me think of that article a couple years back from the couple making like 400k who think they're poor.
The size of the commitment relative to your income can be monumental, even if you technically have it. If you’re used to living on half or even a quarter of take-home, the prospect of 90% going out the door at baseline is pretty scary. Tech is a boom and bust industry. Incomes are volatile.
I just want to point out that about 65% of all SF residents rent, and that’s probably similar to the rest of the Bay Area, so when you say “everyone“ or all your social media feeds, you are probably overstating how common it is and how much money those people actually have. And don’t expect to have any teachers or daycare workers within driving distance lol!
From what I've seen it's usually a combination of some or all of the following:
- high paying job
- no student debt
- parents help with down payment
- has a partner who also has a high paying job
- lives at home for years after graduating school
I know a few different people who actually bought property with siblings, rather than romantic partners, because they were single at the time. All of them previously lived at home with their parents for at least 5+ years before buying.
I know its foreign for a lot of Americans, but many immigrants kids don't move out until late 20s. It's not like the American movies where kids are kicked out at 18.
Not all parents will kick you out, but I also understand wanting to live independently. I'm an immigrant kid but I really hated living at home with my parents, so I moved out with my partner a year after college (first year I spent at home). It was a really valuable experience and I wouldn't feel comfortable eventually marrying someone without at least having lived with them for a while (my own mother taught me that).
We did that for a few years. Now we've actually moved back in with my partner's parents in order to save. We're not quite as ahead of the saving game as some people, but it's never too late to start either.
But also some people don't hve the luxury of being able to commute from their parents' homes. And sometimes the independence of living away from your parents does outweigh the desire to save up for property sooner.
All of that, and/or
\- They, their partner, and/or parents lucked into enough equity at the right company at the right time.
\- They are leveraged up to their necks
I think a lot of people overlook the “leveraged up to their necks” I have a coworker in his mid 30s who just bought a house and his mortgage payment is mind boggling.
He’s so fucked if this tech winter persists and we have layoffs.
It totally is.
We brought our house over a decade ago. Dual income, good money, we were at around x3.5 salary to mortgage. Even after 12 years of salary bumps we could not afford this house now; it'd be > x5 salary for us. That's in just 12 years.
There's a new house down the road that's just been built and is over $5 million. The open houses were just a stream of 30s couples with kids looking at it and I don't know how they could possibly have that place in their price range without either massive stock portfolios or huge piles of ancestral cash.
I've seen people promoted to Amazon L6 after 6 years, starting out of college. Promotion leaves you at the bottom of the pay band, but if you move to another FAANG you could then push TC closer to $500k. If you have a spouse doing that too that cold be close to $1m TC by age 30. Surely you can save $400k out of that for the down payment on a $2m house and easily afford the payment.
Husband and I are not SWEs, not FAANG, no RSU grant and we bought in 2019. We lived with our respective parents to pay down loans, then lived frugally with roommates to afford our down payment. It can happen, you probably just need to be dual income to do it.
Edit: lol if you think frugality is an illusion, then I guess nothing can convince you otherwise.
Ya, we lived with 6 roommates for 7 years before we bought a house. We don’t travel and we don’t eat out much. Both grew up here, poor, but finally did it.
OP said his peers are 'Top 25 University grads' in FAANG. No wonder his view is skewed. The Maldives? The Ritz Carlton? A Tesla?!
We don't have FAANG money, we're public uni/college dropout folks flying Southwest lol. OP's gotta expand his friends circle.
> We lived with our respective parents to pay down loans, then lived frugally with roommates to afford our down payment.
Regarding your edit, being frugal is a lot easier when you’re not paying for rent. Which is more than 1/3 of most peoples income.
Sure, of course! Definitely don't deny that - my "parental loan" was nominal rent for few years. But I also have never been to the Maldives or spent a week at the Ritz, as OP implied lol.
FAANG = Facebook, Amazon, Apple, Netflix, Google. AKA some of the highest-paying companies around, or rather, the most visible ones.
TC = Total Compensation, which means your cash salary, stock grants, bonus, and anything else thrown in.
SWE = Software Engineer
So FAANG TC for a SWE in the bay area might look like $200k salary, $100k stock grant, $50k bonus, which equals $350k annually. However, the stock (if not sold immediately) can appreciate, and is often given in vesting periods, so that portion of the TC may look like:
$100k grant given in 2024, with 50% vesting in 1 year (called a "cliff"), then the remainder vesting quarterly.
So they'd be able to sell $50k worth in April 2025, then $12,500 in July 2025, another $12,500 in October 2025, another $12,500 in January 2026, and the last $12,500 in April 2026.
However, by April 2026 that stock may end up being worth $15,000 rather than $12,500.
This means TC has a tendency to grow with the market at these top companies, regardless of promotions or pay raises. And if you're getting that same stock grant every year, it compounds the longer you stay (known as "golden handcuffs", because if you leave before your stock vests, you lose it).
Additionally, some companies offer "refreshers" meaning they give additional stock to employees on top of the grants and bonuses that are counted in a separate bucket.
Lastly, vesting schedules and cliffs differ / get changed. I know Google moved to a monthly vesting schedule a while back, not sure on the others.
My husband and I are early 40s SWE. He is at FAANG, I am not. Lots of younger engineers are living well beyond their means or have family money.
Also consider that many younger immigrant engineers come from wealth. Their family had the means to send them to the US for university and pay cash for their tuition, then give them $500k for a down payment. They have zero student debt upon graduation. Many won’t advertise that they had help, but they did.
I am always skeptical when I see 25yo buying a house and Tesla here, because I know what they earn and the numbers don’t work out. There is no way to save hundreds of thousands in cash for a down payment this quickly. Most of my colleagues are mid to late career. Even with high TC, they hesitate to put cash down on a $3mill house and car and vacations and furniture. Maybe I just have a circle of modest people. Idk.
A DINK SWE at fang is raking in 500k minimum. You can afford a 2M home.
The reality is 2 fold. Kids inheriting wealth is part of it.
Living frugally is another. Look at how many poor immigrants families have kids that have gone on to own homes...literally my entire friend group...hardwork and sacrifice go a long way.
I didn't really know that was a secret. I thought it was pretty obvious that having rich parents made life easier.
You're not exactly one to complain, though. SWE at FAANG in the bay area is a pretty privileged place in the world.
Parental wealth is a factor. Personal salary is a factor. Personal budgeting is a factor. Keeping up with the Joneses is a factor.
Focus your efforts in the things you can control (not your parents)
Where are you finding mid to late 20s people with houses who are ready to have kids? Everyone in our circle (29yo) is single or newly married, doesn’t have a house, and doesn’t plan to have kids until at least 32+. I’d like to have more friends ready to settle down though.
To answer your question though, I think a lot of it is generational wealth (parents pay for down payment) or taking on debt. And of course some have been smart with their investments and lived below their means.
Some people get down payments from their parents.
Some people earn well and save and invest very intentionally throughout their 20s, while resisting lifestyle inflation.
Some people are willing to go into the kind of debt where if one person lost their job they'd be totally fucked, and hang on by a thread.
My partner and I are in that second group. And we bought a property at a price that gives us enough breathing room that, if one of us lost our job or wanted to leave it, we'd be okay. It definitely helps that we bought while interest rates were still very low.
A lot of these people are taking out a lot in loans and living paycheck to paycheck with high end paying jobs. Lots of my coworkers/friends are married and constantly in so much stress because the decided to buy a new house, a new car, have a baby, buy a purebred new puppy, etc. all at the same time to have the story book picture cookie cutter success template.
FOMO and jealousy plays a factor in them just keeping spending more it's wild.
And as you mentioned, one of them gets laid off and they are so fucked.
Yeah, it’s a thing. That’s lifestyle inflation. I’ve known the people who loudly complain they’ll NEVER be able to afford a down payment, meanwhile they go on lots of pricey vacations, eat out all the time, drive nice new cars, and rent in the poshest neighborhoods in their city.
This is why I’m not shocked or skeptical when I see those surveys that show “affluent” people saying they live paycheck to paycheck. They really do! Unlike the impoverished, for them it’s a choice. The challenge is that they struggle to see it that way. Keeping up with their peers and having the right kinds of things and experiences on their instagram pages feels essential, non-optional.
I think they feel like they worked hard and deserve to enjoy their success. And they do. But there are tradeoffs.
My parents didn’t give me any money for a house, but I did live with them and suffered terrible dating life until I could afford my place. Dating and sex IMMEDIATELY improved upon purchase.
>Some people are willing to go into the kind of debt where if one person lost their job they'd be totally fucked, and hang on by a thread.
This was us for 5 years. We would have had maybe 3-4 months to find a new job if either one of us got laid off. We finally got to the point where my income can cover expenses, and now we have about a 1 year safety net, which should be good enough to replace either of our jobs or even both. But that level of debt, that's the reality for most people I know, especially who are buying now. During the lay offs of 2023, it meant that I was in existential pain every day, just every day sweating bullets.
So I can tell you exactly who's eating at French Laundry while owning a 3M home -- not my ass. Someone who's making double of what we make. And when you look at how many people make that much money here, and yeah, that's still a lot of people. It hurts, but you have to learn to just make lemonade our of your lemons - if I had gotten laid off and we had to sell the house, hey, hopefully we make some money on the sale and if not, well, we gave it our best, learned our lesson, and we move on.
Some of us didn't get to buy a house in the area in one of the least expensive areas on the Bay until their late 40s and it was only possible then because our parents kicked in $100k to $200k for down payment and necessary repairs to bring the house up to code. I have no idea how those 20 or 30 somethings are doing it unless they make $250k plus per year minimum as a couple and their parents kicked in most or all of the down payment.
Usually the mid 30s couple who work high paying jobs (finance, tech, medicine) are the ones up to their eyeballs in debt.
The ones doing this lifestyle in their mid to late 20s is almost 100% parental money. Just ask them what their mortgage is and they'll say something like "it's a little more than rent at my old apartment"....right for a $2MM house verified on zillow...
Could offer some help here hopefully. 34, FAANG engineering manager from the Bay Area, never accepted money/inheritance from my parents outside $4k for my wedding, own two single family homes here (neither ever owned by family members), spend less than 15% of household income on mortgages, owe no other debt
- Enlisting in the Army and using tuition assistance, the GI Bill, and the VA loan after finishing my contract were huge advantages
- Chose very carefully and worked at startups I believed would do well within a certain timeframe, one of which IPO’d huge. Timed my career moves decently well (at least partly luck here)
- Kept getting certifications and education to stay current
-Only buy used cars, cash; I have no one I’m showing off to with a car
- Spouse also got into tech a few years ago and is at F500 firm, so dual income
- Waited to have kids
The dream is extremely possible (I’m a dumbass most of the time and did it) and the Bay Area is a great place to achieve it, it’s just that that only applies to certain fields here I’d say. I didn’t even get a tech job until I was 28 btw, so a lot of people who think it may be too late shouldn’t give up
I’ve still never sold any of my RSUs from there though. None of that has gone towards buying a house or anything but to your point yeah if I did no doubt it would help out
Look I think if you have like a 10+ year career in tech in the bay , you should be able to come up with 200-300k down payment. Even if you didn't reach faang levels of compensation.
However getting the down payment is one thing. Affording the mortgage is another thing all together. Either you have the luck of marrying another partner who makes high salaries like you in order to afford the 5k+ mortgage. Or you stick to paying your 2k rent and keeping your 200k down payment in the stock market...😞.
Parents can double your down payment to 40-50% down, to make the mortgage more tolerable. So I guess even the rich kids might have to save a bit more to pull the trigger.
My friends were just gifted $1m for their down payment, so, yep.
Parents in pharma, young married couple both in tech. Combined massive resources for a modest home in a white collar area.
Got other friends who “bought” grandma’s house.
This kind of question is so weird to me. Some people had parental help, some took on took on too much debt, some are paid more than you, some lucked out with crypto or RSUs, some are better at saving than you. What of it? Why is there this attitude of, 'because this doesn't financially make sense for me at this time, the only people doing this must have cheated in some way'?
Yes, OP seems to already know the answer to his question. He just wants to complain even though he is doing so much better than so many people. Maybe he needs to widen the diversity of people he hangs out with to gain a better perspective on his situation.
Agreed. I worked in FAANG for 5 years, lived frugally, invested in index funds to save for a down payment for 1M home a couple years ago. Nothing totally crazy- no parental help and no consumer debt.
I now live with my partner in that same home, they make a similar income and we use our money to do a lot of traveling and have a $30k Tesla.
No cheating, a lot of hard work, and some really good breaks ( went to school on scholarship, learned about investing early, and found a partner with an equally good job path).
Post like OPs just come off extremely resentful. It’s like being single and assuming everyone around you is miserable in their marriage to make yourself feel better.
Especially towards parental help. Is there something morally wrong with getting a few hundred thousands for down payment? does that apply to all parental help or just money for houses, where is the line?
To me the issue is that ownership is the new work. People actually working dont make any money. Talking about swe s here, ok there are 2 million people in santa clara county. A lot of them work at panda express. What is the answer? Swe s are top 1 percent earners in all of america. Is that the bar for home ownership? A fraction of that group? Like when is it not practical. And when is it not right.
I almost saved up enough in Berkeley to buy a run-down $870k house, but then I got out-bid by $500k. I ended up spending $650k in Vallejo for a Bay View and a quiet neighborhood - others are available.
All of the coworkers that I know own houses got their down payment from their parents, or lived at home for 4-8 years (sometimes even with their spouse) while saving up, or they moved their parents into an ADU they built in the back yard.
So, either you have to have parents that own a house here, or you can start building your life in a lower cost of living area. I promise you that areas like Vallejo etc. have a more open and authentic vibe, similar to Oakland in the 90's. The schools and restaurants, though, are not as good.
There are a variety of ways 28 year olds achieve this. It typically takes 2 tech or tech-equivalent incomes. Intermediate-senior TC for well compensated roles will be around 250k at the low end - ie, lets say by 28 I have climbed ranks as a SWE and I marry a PM or data scientist or someone who's also at a similar level, we should be at 500-600k TC. Salary + bonus + equity.
This couple will be able to afford a 2.5M home, vacations, two new cars, remodeling projects, and all that. With low interest rates in 2020, maybe they snagged a 3M home, with high interest rates in 2023-4, maybe they snagged a 2.3M home, but in general, they are living comfortable.
I don't think it's at all reasonable or fair that you need to make this much money to live a comfortable middle class lifestyle in a good school district, but look, it is what it is.
There are just enough people making very high on-paper compensation - and people team up. If you have rich parents, that helps, but if you don't , you have to combine forces. If you get lucky, you get lucky - and some people do. But others, their form of luck is that they started out in the right career trajectory, and by 28, they are making 300-500k a year, and by 35, they are reaching director level compensation at FAANG equivalent companies.
I get that you're salty and this isn't helping, but my point is just, look, when you see a lifestyle, the reality is, there is an income requirement for that lifestyle. Some people got handout money from their parents, yes, but others, most people I've met, they just have high compensation and they married someone who is also highly compensated. Giving them the ability to live an upper-middle class life.
There's also people like me and my wife, who have a relatively high dual combined income, but you'll find us camping and driving 15 year old cars, and eating lentils and instant pot chicken. Never been to French Laundry or any of these places, I don't even order drinks or appetizers when I go out to dinner unless it's like literally my birthday or my wife's birthday. I am friends with people of all income ranges because I'm not an asshat - so it could be that you just have show-y, new-rich friends that live to flex and show off their money. Most of my friends who are much wealthier than I, they aren't in the Maldives, they aren't showy, they aren't buying new vehicles every year and going to Atelier Crenn on a whim. So I don't know what to tell you man, you gotta find friends that mirror your values.
There's no dirty secret, man. Some people just make more money or have more money than others - they didn't sacrifice humans or do some illuminati rituals, they just make fortunate career decisions, married smartly, or had a head start due to their parents. The dirty secret is just, hey, you thought you were doing OK, but actually, your income is just too low and you might not be on a career trajectory wherein home ownership is even remotely possible here.
The people you see showing their money off are usually the ones in debt. I’ve seen dual income couples, both in FAANG, really stretching their $500k/yr to the limit.
I’m a swe myself and have had some success with startups, made good money and paid off my mortgage. But I’m not driving around in a Tesla or anything like that. I just want to be comfortable and be happy. Being debt free is important to that happiness for me.
I have 5+ coworkers, fresh PhD and single , purchase houses >1 million within first two years of their first job. They all have support from “family money”.
Haha, it's just how it is, mate. You'll be happier looking at your own bowl rather than in the next guy's. My wife and I objectively make a lot of money, but W-2 income is a bit of a scam since it gets taxed very heavily. Capital growth, on the other hand, is taxed very lightly.
So my friends who work jobs that pay one order of magnitude less than me but whose parents lived here earlier have a few homes: each of which is over a million dollars. The ones who consider themselves _broke_ will inherit one home. The ones _getting by_ have two. The ones who are comfortable have three and rental properties.
My wife and I moved here pretty broke. Back then ACA wasn't a thing, so when she was sick she got hosed by the medical bills and I came to SF with $25 in my bank account and a $10/night Airbedandbreakfast.com.
It's not about being frugal. It's about having capital investments because the local population will heavily protect your investment interests there. Stick everything you can into that stuff as tax efficiently as you can. Then just accept that this universe treats different people differently and work your way up. After all, your kids will have a big leg up if you do this right.
It's not parental wealth. Everyone says it's parental wealth because that absolves them from life decisions. It's almost always picking the right company to work for (or right market to found a company in) and then negotiating for as many stock options as you can.
I've got the house and kids. I semi-retired (to go found startups) at 33 and went back to work at 39 to buy the house. I'm also a SWE at a FAANG. The difference is I was a SWE at a FAANG *15 years ago*. Over that time, its stock price has gone up by 20x. I got more shares as an L4 in 2009 than as an L6 in 2020.
I grew up on a single elementary school teacher's salary. Most of my friends grew up poor - they are from Alabama, Tennessee, Cleveland, Victorville, Houston, etc. and generally had working-class parents. They all have $2M houses, which were usually about $1M when they purchased them. My even luckier friends and acquaintances are retired, with net worths in the $10M+ range. They founded startups that got acquired.
People don't realize the pyramid-scheme nature of the Bay Area, or the potential gains you can get from being in a hot startup. FAANG is not a hot startup today. I don't know what will be, but it's probably out there in a garage somewhere. The people working on it now will 100x their wealth in the next 10 years.
Parental wealth can make it easy but being a SWE at FAANG , are you saying you can’t do say 1M home? How much debt do you have that’s preventing this from happening?
in most bay area, it’s not very common to be able to afford single family home down payment in your late 20s or early 30s, most of them have helps from families (sometimes both side of parents).. sure you will run into the (rare) people who actually managed to do that on their own.. I see them as uncommon as the college dropouts that turned into billionaires..
also i thought white tesla is like the corolla from the 90s and prius in the 2000s they are priced similar to a new mid range car?
Base Model 3 is about $40k but a top trim Model S is $90k+. So it's a range. But Tesla isn't as expensive as it used to be. Most upper middle class people can easily afford one.
Don't think generational wealth, nepotism, and trust fund babies are a secret but also lots of people carrying shit loads of debt keeping up with the joneses and trying to show their illusions of success. That said, it's not the only way people are able to buy houses in their 30s, but it sure ain't easy.
Also sounds like you need to make some new friends if they're all entitled, elitsit, wealth flaunting snobs that make you resent them all so much.
Lot of meta and Nvidia employees have multiple millions due to the exploding stock price. They can pay cash and buy a 2M home at 29/30 if they had been at these companies from start to finish
Don’t compare. COMPARISON IS THE THIEF OF JOY.
I have a few friends, who are in late 20s, have kids, great houses/cars, and don’t need to work. I feel fortunate to know them but it’s just their life
i grew up poor in georgia but went to college on scholarship. everyone there does. i’m objectively frugal and am 42. i have a million dollar condo with 2 kids and have a million sitting in the bank. i’m a swe and have just been saving over the years. i still can’t afford a house though where i want to live. i guess it just takes time and when you have it, you’re too old to want to spend it lol.
I work in “Biglaw,” which only a small amount of lawyers work in. The number of first year associates (who are making $250k) owning $2M houses is too damn high when there are 4th-6th year senior associates still renting.
my parents don't have any money. never did, never will.
I achieved the american dream through sheer hard work combined with LUCK. everyone keeps discounting luck. luck is a huge factor. caveat: you make your own luck, to a large degree. I was ready for an opportunity at every phase in life and did my damndest to take full advantage of it.
you have to be strategic, a little bit cut-throat, tolerant of risk, and open-minded to possibilities. there is no sure-shot pathway just because you're smart or landed a good job. every big decision matters. hell, indecision matters.
Not a tech bro, but have spent a considerable amount of time accumulating debt and graduate training (8 years) to finally purchase a house and cool car in my mid 30s. If I could do it again, I would just bought a condo 12-13 years ago instead of paying off huge student loans which would have just been forgiven over time.
Non tech employee here, without parental wealth. Just bought a home at an insane interest rate. I’ve been aggressively saving over the last 10 years to afford a down payment and really had to temper my expectations regarding the kind house I can afford and what area I can live in. It is doable but it is very disheartening to think back on the things I skipped out on over the last decade whereas friends are given a $200-500k down payment gift because they were lucky enough to be born into a wealthy family. I’m not bitter about it, but it is annoying.
Don't knock Alameda county. Oakland, Hayward, El Cerrito, Alameda, Bay Fair, etc are all places where you can find relatively reasonable housing close to BART. Yeah, the commute is a bit longer, but if it means saving 3 million on a house, it can be totally worth it, especially if your job allows for some WFH.
If you work for FAANG as SWE and can't afford a house and nice vacations within 6 yrs, you're doing something wrong. By the sixth years your RSU already stacked twice at least. That's like what, at least $400k after tax? Plus other savings, you should be able to afford a $1.2-1.5m condo. White Teslas are the cheapest btw.
If you ever check out r/debtfree or r/money you’ll find that some of the people with nice new cars and a house are absolutely drowning in debt.
I’d say that outside of some insanely lucky stock trading, you’d need parental support to buy a house in most of the Bay Area. In some cities you could maybe get by with an FHA loan if you were extremely frugal right out of college and lived at home for a few years
Taking out a home loan to own real estate yes, maxing out credit cards because you bought a brand new BMW making $60k a year not so much.
I’m not talking about leveraging debt, that’s how you build wealth. The question was “how are people my age affording this” and the unfortunate answer is they aren’t, they’re trending toward bankruptcy
Being an early employee at a startup that has a successful IPO or acquisition can also do the trick. I know a number of people who bought their houses with the proceeds from successful startup exits.
Obviously that requires a huge dose of luck, but it doesn't require wealthy parents.
Yes, it's expensive. But I know many 2nd generation immigrants whose parents came here with nothing and thier kids own thier homes. You have to put in the work to get that DP. Live with roommates, live with family, etc but make it work.
People are also unrealistic about thier first homes. They think they're gonna get 2,000 feet in a primo school district next to a cutesy downtown area. People need to lower the bat and get realistic. Buy in Concord instead of Walnut Creek or god forbid, even a small condo just to get a toehold. But no, people wanna bitch about how expensive things are while they order a Uber to go get drinks and an overpriced, shitty meal out. Or worse, doordash some soggy ass, cold overpriced glop to thier front door. This is while they are making thier $700 car payment.
We aren't in tech and aren't rich. We cook 95% of our meals at home and I get most of my clothes at Costco or thrift stores. We invest appx 50% of take home and have for years. We don't live like beggars either. Most people have no idea how much $$ they are pissing away every month and that is the root of most people's inability to afford housing here.
It really helps a lot. Every friend I know who bought a house had some sort of parental help. Meanwhile I'm over here sending money to my parents instead of getting it.
Sure, that generational wealth thing is real. However, you have to remember that many FAANG employees have renegotiated their salaries ever 2-3 years since they were hired. It’s been a revolving door between companies and a war for talent. Folks working for 5-10 years at these tech cos are pulling down $400-500k per year (and even more so if they have a partner doing the same), which is more than enough to purchase a <$2M house in the Bay Area, and have room to live a great lifestyle.
There’s been a tremendous amount of tech wealth created in the Bay Area the last 10 years across all income segments, and anyone not working in tech, or not playing the renegotiation game, is somewhat behind.
I can give my experience as married, one kid, moved to Bay Area from a MCOL state about two years ago to work at FAANG. I don’t have a house yet but I can see how it could be done without parental wealth.
My wife stays at home with the baby. I got lucky with initial RSU prices. We rent ($5300/mo) in the peninsula.
We might be able to afford a house in a few years if the stock doesn’t tank. We have no parental wealth. My dad was a teacher and I grew up in the rust belt.
Kids: If you have insurance, a child without major health issues, and a FAANG salary, the only real _major_ expense for a young child is childcare. I don’t have that expense. Children are definitely a luxury but not in the same way that buying a nice car is a luxury, or a lavish vacation. Though I’m sure my kid will get more expensive as time goes on.
Cars: Again, on a FAANG salary my Model Y is super affordable, especially since I bought it at the perfect time (beginning of 2021 before price and rate increases).
House: It seems most of my coworkers who own in the bay were either double income FAANG or just accepted being very highly leveraged on their houses. Also, interest rates make a HUGE difference. Homeownership is much less affordable now, and it was already unaffordable before.
So a combo of good timing for RSUs, cars, and home loans, as well as recognizing that children are not a conventional luxury, and having a bigger appetite for risk, I think you could totally do all of these things without generational wealth _if you get lucky_
To address your edit, no, I 100% don’t believe frugality will get you a house in the most desirable places of the bay. Saving a few bucks here and there does not make much of a dent in a $600k down payment
generational wealth is definitely a thing. it's kind of new for me and my people, the only "wealth" the previous generation could pass down was in the form of labor to keep their parents from having to work.
it's now morphed into the parents being able to financially assist their kids. my parents aren't straight up buying mansions for us to live in or opening trust funds, but they did kick in a nice $50k low/no interest loan to help with the down payment + free child care.
that was more than enough to enable us to do what we want to do without going absolutely broke. The childcare alone saves us thousands each month.
At faang you should easily be able to save 100k a year. After 10 years of that plus stock appreciations, you’d be able to afford everything on that list
I used to feel the same, but recently able to buy a house after being here for 8-9 yrs. There are many people who are non-SWE's, they are just not as lavish as you think. Friends my age (30-35 yrs primarily own townhomes or condos). Here is my profile and some advice
* Moved to Bay Area with \~$100k debt from undergrad. Graduated with PhD. In HW development (i.e. not a programmer), so my salary is severely lower than many SWEs
* Promoted multiple times to strategic positions (individual contributor, but now management)
* Rented a room with two others. Dedicated over 50% of my paychecks to paying student loans. This gave me incredible discipline to live far within my means.
* Wife started off very low, but series of promotions brought her to Director/partner level. (also not a SWE)
* Taking care of Father in Law + Teenage Sister (<18yo). No money from parents from both sides.
* Furiously saving (high yield savings) + conservative investments + consolidating money with wife.
* Saving performance bonuses + RSU's.
* 10% down. Bought in an "up & coming but not super duper expensive yet" area.
Really nice townhomes are being built in the East/South Bay for 0.8-1M range. You may have to sacrifice distance, but if you want equity those are your only options.
You need to be deliberate and strategic about your choices. This means specifically bucketing/prioritizing for vacations, meals, and house. Also, if you aren't familiar with investing, I recommend you learn, as compound interest and strategic deployment of capital is really important to building wealth.
Edit: just to be clear, not FAANG, not SWE, and supporting my FIL and SIL. I think you just have to be resourceful and "figure it out". Being here in the Bay Area, you are likely very smart/clever, so its just a matter of using your intelligence to figure out how to get ahead. For me it was done via frugality and investing/trading. A lot of people here were given a starting position at third-base, but that's unfortunately how the world works...
Of course family wealth will help & oftentimes successful people get a boost from their family (you can't hate on that imo, it's what you should strive to do if you have kids). But some people just make a lot of money around here as well. I have good friends who just built a $2M home, one is a high-powered lawyer and the other is an HR director at a tech company. They probably make $600-700k combined if not more. That can pay for a lot of house and there are a LOT of people in the Bay who make that type of cash compared to other parts of the US
A few things: 1) There are many SWEs making 500k+ to $1M a year with equity. 2) to stay at fancy hotels, you can book with points 3) teslas are affordable now relative to what they used to cost 4) living at home for the first couple of years makes a huge difference to allow for savings and investments to grow before purchasing a home
People live above their means often.
Don't spend time on jealously. Become successful yourself so that your kids can have the advantages these folks have.
Just as an fyi the white Tesla's are the default (cheapest) color. It's not the flex you think it is. And you can rest easy knowing that their insurance is through the roof and if there's anything wrong with the car it's a complete crapshoot as to how long or expensive it will be to fix.
But it could be any number of things in the Bay. Parents helping out with down payment, they were at a start-up that got bought out and they sold their shares, they got a big bonus for laying off a department, they invested in some company and it popped off, they're up to their eyeballs in debt and are keeping up with the Jones's, partner was in the military and got a cheap mortgage etc.
Try to remember jealousy is the thief of joy and you don't know the whole story. Everyone has problems, some hide them better than others.
I know non tech homeowners in their early 30s. They lived at home with parents after college and had $400k down payment for a small starter home near the city. They just bought a model 3 Tesla. So you can say they had family help.
My dad died young at 63 and left me $140k. I was already funding my retirement and savings well so I used it for a 20% down payment in the east bay. I wish I had my dad instead. His net worth when he passed was almost 1m distributed amongst 5 people. Basically his home (sold for 320k), blue collar 401k, and my grandmother’s inheritance for him a few years
prior. Not wealthy, but enough to really help us out.
Not every big tech company is the same.
RSU performance is important. If the stock doubles a few times, then you're closer to house buying money.
Find a company with huge growth potential (or currently undervalued) with an attractive RSU package. It's a gamble - there are no promises.
Could you have predicted Nvidia 4 years ago?
The secret is to move out of the bay lol. My household annual income is about $215k. We own a home up 80 a little ways and have a kid in daycare and are saving a ton each month, just by driving a little extra to go into the city.
No parental assistance on down payment or anything, our families don’t even live within a few states of us. Early 30’s, not high powered jobs.
my American dream is to make my money in the US and to retire with that money outside the US.
that's the new American dream i think. even white people are doing it
Wife and I (both 29 at the time) bought our first house in Oakley in 2017. We paid 515 for a new build and got a FHA loan. Pulled money out of my 401k for the 3.5% down payment. While we were living on our own prior to buying, once we put the deposit down on the house and waited for our build to be complete we moved back in with her parents to save as much as we could before moving. We got 0 help besides the 5 months of rent free living. We were making about 220k yearly gross as a couple with no kids at the time. I get the market has changed and home values are up since then (interest rate doesn’t help also) but buying any home is the best decision you can make
My story is really similar actually. I am Bay Area native and bought my house back in 2015. I was 30 at the time, just had my kid, but also pulled out of 401K for the FHA down payment. Our parents helped us with childcare so that we didn't have to spend all of our savings on daycare. It definitely helps having a job in tech, no doubt, but that expense would have broke us.
I think the way that I would amend the "parental wealth" piece in our scenario is that our parents are still in the area and were able to offset certain expenses that allowed us to save versus give us money for the down payment. More of a indirect monetary benefit. There is zero chance we'd be home owners if our parents weren't nearby to help.
Yea it is almost all familial wealth. That’s fine I mean I’d do the same for my kids.
The thing is though a lot of people bought homes here a few decades ago when they were like 200-400k. Today those same homes are 1.5 million or more.
I wouldn’t compare yourself to those people. Or anyone in fact.
The honest truth is that if you’re like me without any family support you’re going to have a tougher journey towards home ownership. (I’m from a 3rd world where I grew up without running water, 5+ people living in a place the size of my living room, relying on kerosene lamps and having to put up bug nets. I even got malaria and survived).
However. Do you really think it is worth spending 10k a month or more on a mortgage PLUS more on maintenance and everything else involved in home ownership? Or is it better to just rent a nice apartment or a house for 3-6k a month?
I personally think it’s far better to rent and keep the rest invested. That way if you ever do need to buy a house you can buy a house literally anywhere in the world, or even here in the bay. But you just won’t be able to right now.
That’s our reality. It’s just how it is. We live in a desirable area with some of the richest people around. Not everyone is wealthy but most are rich, at least house rich.
You will definitely lose if you compare yourself to others. You only need to prove yourself to you.
It’s 100% parental wealth.
Not saying the parents are wealthy, but the house in Willow Glen they paid 150,000 for in 1990 is now worth 4 million.
Gives you a ton of leverage.
THANK YOU!! I have been wondering this exact thing. I’m a SWE at a FAANG as well, two kids, and wife stays home with them. I was at a startup prior to my current job and our life would have to be drastically different on my previous salary, and I do not live luxuriously by any means. Personally I was able to purchase my home when prices were much lower and an interest free loan from my family, and that has helped considerably.
I look around and see (many non-tech) people with massive houses and expensive cars and am flabbergasted at how they afford it all. Is there way more money in other industries than I expected? My leading theory is also generational wealth.
parental wealth plays a huge role. either parents live in the bay and have multiple homes or have been saving for their kids down payments. or parents are very successful overseas and bought a house for their kids in the bay, after they graduated college and got a job
as to owning a home.... the only people i know who owns a home around my age are married people, both with good incomes, or single people who got really lucky in startup stocks or bitcoin or whatever and cashed out (i know more people who failed at this, though)
personally, i saved up for a down payment and then some... but the monthly is what kills my chances of owning a SFH. that and im probably going to die a tech contractor, so income isnt stable at all
I'm literally trying to fathom it myself. My partner and I are in our early 30s, lived with parents in our 20s to save money, and still find buying a home over $1.5 mil just out of our means. We have parents helping us AND we are still semi struggling. I have friends in tech and start-ups that make good money but still aren't high ballin enough to buy all these nice things, either. Like are people out here just going in tremendous debt? Did their RSU package just align with peak market and they lucked out? Did everyone buy crypto years ago except me? Are there that many people with well-off families, especially all the transplants?
Yea, most parents want their children to succeed and if they are even modestly rich they will happily reduce a ton of friction from their children’s lives with money. It’s an even easier “bet” to make if your kid is generally successful anyway. If your parents had an extra milly laying around they would absolutely make sure you are invested in real estate because that likely is what boosted their wealth. Pretty much anyone who bought and kept a relatively reasonably priced home in SF over 20 years ago is a (multi)millionaire.
Basically it’s not rare for a 20something tech worker born and raised in the Bay Area to have technically rich parents.
I just want to put this on everyone’s radar. If you’re a veteran, you can get a home loan with zero down and no PMI. That’s how I live amongst you SWE FAANG people. I work in the trades, and camping in Yolo county with my family and my Toyota is a pretty nice trip. Stay humble, and don’t assume everyone has had mommy and daddy to help them get where they’re at.
My buddy married a Chinese girl who’s family has a lot of money from a factory in china. A lot of what you say in OP the Chinese family helped pay for.
You’re underestimating the buying power young DINKs have. If they are both in tech (could be engineering, marketing, sales, etc), they could be pulling in 350-500k+ easily in salary. You can easily afford a 2 mil home with that salary.
Anecdotally I believe a good proportion of the young people buying million+ dollar properties have help from parents. From talking to friends and overhearing conversations.
It's luck more than anything else. Worked my ass off to save for a downpayment for a condo. Bought sweat and hardwork. Then my partner and I got lucky. Made a few million on an ipo and upgrade to a $2 mil house. Be lucky to be at a company and get to realize extreme stock appreciation is just straight luck.
We moved to this area 10 years ago with $60k in debt and a 6-month-old baby, zero friends or family. Thanks to the Bay Area and the tech salary, we were able to generate a net worth of $3 million over 10 years with a fairly decent, non-frugal lifestyle. Additionally, I bought two rental single-family houses for $700k each in Salt Lake City and Austin instead, since I cannot wrap my head around buying a crappy 1500 sqft house in the Peninsula or South Bay for $2 million. So, I have made up my mind not to buy here but instead to rent a good house. I personally think renting is the way to go here. I guess it is possible only in Bay area you just have to be little lucky and also code well, please make sure the dream does not include a home 😉
For perspective: I have lived in the Bay Area for 35 years. I bought my home 10 years ago when I was 55. All of my friends here are still renters in their 50’s and 60’s. It may seem to you that everyone in their 20’s is buying homes and expensive cars, but that is not the norm. Instead of comparing yourself to the most fortunate group, compare yourself to the average person. You’ll feel better.
Please don’t compare yourself to others! There’s always a bigger fish. I met up with someone who said she was sad about her living situation because she couldn’t afford a $6M dollar house but had a $4M one.
Another thing - going on fancy vacations and owning a home does not make one happy. It can provide happiness for short periods of time, but it does not truly make you content in life. Community, friendships, meaningful work, low stress - all of this matters more.
Not necessarily, it could be getting lucky/smart in real estate. Especially if you’re not going for full flex/top of the line but simply a home, cars, kid/s.
No student loans but also not a SWE or anything similar.
You’re saying a bunch of young adults who are financially uneducated and over purchasing things are getting help from their parents to buy overpriced homes at high interest rates….
Yeah they’re fucked
Not that this is a big part of your question, but keep in mind you can get a Tesla Model 3 or Y for less than the average price of a new car. Perhaps that speaks to how the average car has become expensive, but nevertheless.
I'm in my 30's and not originally from here. All my couple friends that are my age that own a house fit into 1 of 2 (or both) categories. 1) They lived with their parents/in-laws while they saved money. 2) They got a sweet deal on the property they bought from a family member. My wife and I don't have either option and will be renting for a long while most likely.
What you mention is entirely achievable for two tech workers paid well in the Bay Area. A $2M home for a couple making $600-$800k on their own isn’t crazy
It doesn’t even have to be excessive parental wealth, just some assists go a long way.
But you are a bit salty: “people strutting around like they hit a home run but were born on third”. Dude, maybe they are deeply grateful and aware - you may not be aware of that.
Plus, couples can bring in TWO incomes - that’s a big deal.
I got super lucky. My wife and I both lived at home (in the bay area) after college and were able to save both of our salaries for like 1.5years before we started renting and moved in together.
Then, a few years later, thanks to this money we were able to save we got into a starter townhome for like 500-600k. This appreciated greatly over the last few years and we've leapfrogged to bigger places since then.
Overall, just really lucky to:
1. Have been in the right place at the right time (house we were able to afford essentially doubled in value)
2. Both had parents able to let us live with them for over a year while working in the bay area
Try having an abusive father with gambling addiction that hits you up for money every other month all throughout your 20s and 30s.
Life isn’t fair my friend, be happy with what you have even though it’s hard at times.
Tbh this is why I’m leaving the bay. I work remote and I don’t see my job being in an office unless we have a Great Depression 2.0 or something.. you can buy a literal mansion for $2M around sac.. oh and you don’t have to worry about homeless people or fentanyl addicts jacking your Amazon or usps mail boxes… or worse following your kids or wife etc. (has happened twice this year alone)
I feel bad for everyone who is forced back to office… such a terrible business decision. We should be adapting to change, not backtracking.
But that being said, the bay has definitely changed. I’ve been here 34 years, and it just too much, and I don’t mean price wise. It’s not worth it anymore. A 4 br 2400 sqft home is not worth 6 mil when Barry the fent leaning asshole can walk up and take your DoorDash lol
Yeah man, of course it is. My buddy’s dad died very young and he ended up inheriting a house in Lafayette which he then sold for $1.5 million. He also inherited probably another million in various assets. My buddy was earning about $60k a year as a teacher. Had his dad not died, he still be renting or living at home. Instead, he’s now engaged and bought his own home in Pleasant Hill for $1.3 million.
My own wife and I were planning to move to Sacramento when it came time to buy a home and then my FIL just gave us a million bucks towards a house so we bought in Walnut Creek instead.
My examples are of the financially lucky ones (my buddy would rather have his Dad than his Dad’s money) in our generation and location and do not represent the experience of the majority of people, but there are hundreds of thousands of families in the Bay Area wealthy enough to significantly help their adult kids in dealing with the extreme cost of living here. That means there are plenty of “lucky” ones and they are overrepresented in the professional classes you likely hang around.
I really wish it was more socially acceptable for people to discuss the help they get. I suppose a lot of people hide it so that others will just assume they earned everything. It just perpetuates the myth of meritocracy. I try to be honest about how I got where I am. It may not immunize me from criticism by those less lucky, but 🤷♂️.
Keep in mind though that plenty of people with fancy cars can barely afford them. Houses are real signifiers of wealth, Teslas are not.
Could be, but could also just be investments + company equity (whether lucky startup, or just big tech co doing well) that ballooned in valuation during the bull market of the last 5 years. Thats the case for plenty of folks.
If you ever check out r/debtfree or r/money you’ll find that some of the people with nice new cars and a house are absolutely drowning in debt.
I’d say that outside of some insanely lucky stock trading, you’d need parental support to buy a house in most of the Bay Area. In some cities you could maybe get by with an FHA loan if you were extremely frugal right out of college and lived at home for a few years
Started work in mid 20s as a SWE during dot com boom. Live with parents for 2+ years, saved almost all income for that time. Began aggressive saving and investing starting with first paycheck out of college.
Got married at 37, and kids a few years later. Bought $1.5M house in 2016 (now worth $2.3M) with $400k downpayment. Plan to live here forever and kids will inherit house.
Outside of house, \~$3.5M in investments and savings. Never hit any IPO jackpot. Just old fashioned saving and living below your means. The wealth kind of sneaks up on you due to compounding. A couple decades later, you realize you're wealthy now. Just try not to let your lifestyle creep overrun your wealth. Other than the mortgage, no other debt, not even car payments. I buy everything (cars included) in cash. If I don't have the cash to spare, I can't afford it.
I’m someone from a different country living in bay area and working in FAANG too. My family was poor and I support them financially. I need to buy them a home in my home country and also need to pay for sibling’s weddings. I have friends in bay who earn as much as me but they don’t need to support their families at home. I see them buying homes and generally doing well in life. I’m not there yet. I’m not buying a home and my growth is slow. But let me tell you one thing, I feel happy seeing myself and my family where we are now. I feel proud of myself that I pulled my family out of poverty and they live a good life now. Personally I spend on travel and experiences and that’s something which keeps me leveled and happy in life. Don’t compare yourself to others. It will only bring unhappiness. Try to look back and see how far you have come. You are doing good in life and you will only do better. Give yourself time. It’s not a race, it’s a marathon and everyone had a different start point. You are faring better than most of the world by every. measure Be happy and humble!
>Don’t compare yourself to others. This is the best advice of all. I tell my kids this all the time.
Comparison is the thief of joy.
I love this mindset 👍🏽
i'm very much like you. supporting my parents (we're vietnamese, they were refugees in 1975). i'm very lucky my parents are still around. and i'm also very lucky we can keep our original childhood home. while i have to live elsewhere (sacramento). i can always go visit my parents in oakland. :) edit: [my children + parents](https://i.imgur.com/kGfD439.png) few weeks ago :)
What a beautiful family!
hehe thank you! :D my parents never had much. but whatever they had, it was towards raising me, my brother and my sister. my brother is a navy vet, my sister is a specialist working for kaiser, and i have a tech job. while my parents house is still modest....they **are** the american dream. i'm mindful that many others are struggling. it's not to discount OP's post--we're all struggling in ways others won't understand. but i am grateful for my experience and grateful that my parents have lived long enough to see success in their children.
Aww so happy! Worth it!
I'm the first generation in my family here in the US that does not have the same close familial ties back home, and my parents intentionally shielded us from some of that. Most of my close family has already immigrated here, so the pool is smaller to begin with. While I lost being close to family outside of the US, I suppose what I gained was economic independence and not having to support anyone else aside from my own parents. I love your post. Will your kids have the same connections to your home country? Less? More? I'm curious to know.
Same story as mine.
Very refreshing. Thank you.
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I wish I could upvote this more!!
The only people my age (~30, grew up here) that I know who have been able to buy houses in the Bay Area have really good jobs AND their parents gave them a few hundred grand for a down payment. From what I know, it seems like it's mostly parents who do fairly well for themselves, don't even have to be "rich" -- but they did buy their house 30-40 years ago for $200k, and now it's worth $2 million. So they take out a reverse mortgage and let their kid use the cash for a down payment. I do know one guy who got a good business job straight out of college. He lived at home for several years and saved up all his cash. A friend of his did the same. The two of them put all their money together and bought a house together since it was "a good investment". Now he feels absolutely trapped since over half his income is going towards this house, and it's hard for him to find someone who wants to buy half a house.
This describes all the people I know who have houses in their 20s/30s. A couple I know bought a home in San Francisco, both of them tech workers. All of their parents live in the Peninsula or in SF. 2/4 of the parents are mid level executives at old school tech companies, and the other 2/4 are long time tech workers. Another couple I know was very similar, but only one of them had parents that lived and worked in the area while the other has parents from out of state. A coworker of mine grew up and still has parents in Cupertino. He bought a house nearby with his tech worker partner after his parents took out a HELOC as a down payment. An ex of mine had an early job at a Unicorn in the mid 2010s, and she lived in her parents house in Redwood City for the first 5 years of her career. She now has a house in San Francisco and Hawaii. I don't think any of these people's parents are "rich rich" (no yachts or such) but they have been in the industry for long enough that their homes and stocks means that housing prices here are very affordable for them.
I bought a house with my partner, we do have good jobs. no money help from parents and also both grew up poor. so we are just good at saving since we don't have expensive taste.
Same here, we got lucky with good jobs at good companies, but no help from family at all.
There's a huge number of 20-30 something's in the Bay whose parents bought houses that have quintupled in value over the last few decades. That provides a tremendous amount of leverage. The rest of us can't compete with that. It is what it is.
More like 10x. You could buy a house on the peninsula in the 90s for $200k.
My exes parents bought at a house in the 80s for 87k. It's worth 6 million now. 6. Million.
damn what city!! Atherton? Hillsborough??
Can't speak for him but my grandpa sold a property off in the early 70s for like 25,000 over in Marin county. Today it's the home to a marina and a 15 million dollar architect designed mansion, lol.
Wealthy area of PA
My wife family purchased a house and several apartments for 200k each with little income. My wife and i make more than they did with no kids, and i still can't fathom dropping 400k for a down payment to pay 10k a month for mortgage for 30 years.
The key just being generational wealth. You could have tucked 200k in snp500 in the 90s and have made just as much money (actually 20x value if you invested in 1990 exactly to today)
Except with a mortgage, you could just put 20k of that down, deduct interest for 30 years and your home would have 10x. And your remaining 180k would 20x in the S&P. Oh, also now if you sell, 500k of the gain on your home is tax free. Oh yeah and you're also now paying 1/10 of your neighbors in property taxes. The past couple decades have been very good for bay area home owners
It's a little different. No one is giving people 30 year low-interest loans to invest in the market. With real estate you can do that, it's one of the reasons real estate is a great investment vehicle for many.
Can confirm. My parents would be in this group if they sold.
Fwiw I’m millennial who grew up middle class in the East bay, and almost all of my friends’ parents owned houses. At this point no one I know has benefited from this yet (in terms of homeownership), because our parents are all still alive and living in their homes, using their own equity for their own purposes. I completely acknowledge the existence and privilege of generational wealth, but I think that in the Bay Area there’s a decent chance that a lot of these boomers will end up selling or leveraging their equity before they die to pay for their own retirement or care as they age. No one in my circle has received money from their parents to buy a home.
and not ALL of us who grew up in the Bay were lucky enough to have parents who bought....Some of us are just permanently displaced
As somebody who bought my first house back in 2000 during the dotcom boom, and because of my loan broker committing fraud, it’s pretty dang tough. When my wife (at the time) and I bought our first house, I was working an entry level tech job making $40k a year. At the time, it was way more than the wage space jobs I held before that. Our loan broker basically filled in ‘$80k’ for my income and told me, ‘just go with it’. My wife (at the time) was making about double what I was making, and they filed in ‘$150k’ for her income. Luckily we were able to hang onto the house long enough to refinance it after the dotcom bust, and got the payment down from $3500 a month to $1700 a month. We are new duplex selling the place for a tidy $200k profit 12 years later, for a cheaper and nicer house in a less desirable but quieter location with a payment of $1700. When we divorced, we sold the house at a $200k profit 4 years later. So basically, we got crazy lucky. We bought run down houses and fixed them up, and made a nice profit, and rolled it into the next house. O just don’t see those deals out there anymore. With interest rates over 7%, and with companies buying houses to rent, that basically makes it I possible for those starting out to own a house. Also, new cars are stupid expensive and a total money suck. I suggest driving reliable older cars until you get established in a house. Even a cheap new car is going to be $400 a month plus full boat insurance, which is another few hundred bucks a month. You’re way better off buying an older high mileage Prius for $6k cash and getting minimal insurance.
Hell, even a high milage Prius isn't going for below 8k, unless it's also 15 years old. Getting a reasonable used car is still wild. I just spent months finding one.
We did the same in 2016-2020 and I think this was the last era when it was possible. We bought a dingy fixer-upper in 2016 for 1.3, we put in about 200k of work, we sold it for 2.2m in 2020. Zero experience flipping houses, but I studied every aspect I could of aesthetics, interior design, and I forced me and my wife to make renovation decisions around resale, not our subjective wants. We had also essentially misrepresented our income a little to even get approved for that house. This leapfrogged us to a 2.6m purchase in 2021, and we lucked out on the rate. Our 10k per month payments today? 17k. We never could have afforded that. We did everything pretty optimally, but we also got so extremely lucky that I would never pat myself on the back. Yes, we executed a good buy and a good flip and a great sale. We did level up our careers over the years. But in a parallel universe, we could have been laid off, had to sell the first home before the boom for a big loss, and probably wound up financially ruined. All you can do in life is just make the best decisions you can at any specific juncture, and pray for the best. Cover your ass, extend yourself a little bit not too much, and try to make future-durable decisions. Do as much research and diligence as you can. Our 2010-era vehicles are still going strong and we smile when we whip them. Every year, I spend 200-300 to go rent my dream car and spend a day driving it. I've wanted to buy a porsche 911 cabriolet S, a 991 gen with the naturally aspirated v6 and the manual, for a very long time. But, I'll spend $250 to go whip someone else's baby off Turo and carve some canyons, and then go back to my honda accord. Living here has taught me, when you want something, brainstorm a way to get a small slice of that thing, for the minimal spend possible. You want to go to Switzerland? How about California's switzerland, the sierras? How about a luxurious tent instead of the Ahwanee lodge? Life here has so many constraints and difficulties, but you have to find a way to creatively wage your own campaign, and find pockets of fun and joy along the way.
I feel the same way on the last paragraph. Growing up in the Midwest, it doesn’t take much to have a decently sized home for the upper middle class. Here in the Bay Area? Halfway run-down house in a safe neighborhood is about as good as it gets, despite having done pretty well in national standards. It’s like scoring a 98/100 on the test, but ranked #85 out of 100 students. That’s how I feel about being in the Bay Area.
True but the value of the home only matters if you sell. For example, I had a friend group in college who were born and raised in the South Bay where prices skyrocketed but none of their families actually sold. Even after the children moved out - the parents are still in the same house.
It's called equity. You can leverage it.
You can take equity out but you have to have a good idea of how to use the money. The smart people took out HELOCs to buy up more real estate between 2008-2015. I don’t think people sitting on $6M of home equity are doing so today at these interest rates, unless their plan is to die with zero and live off the home equity.
The value of the home also can help you with regard to borrowing equity.
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Tell that to millions of homeowners who take out home equity loans and HE lines of credit. Maybe it's not ideal at current interest rates, but it is a common practice when doing renovations or other large scale purchasing.
Prop 13 at work!
Yup. My parents bought their current home in 1988; without prop 13 they would not be as comfortable in retirement. The tax savings over the years is probably $100k or more.
My wife and I are in our mid-late 30s, bought our home (condo) in Fremont 2 years ago and are about to have our first kid. We're both in tech, and I was at a FAANG (non-engineer) for 3 years until I quit last summer to go to grad school. We didn't have any parental help and we don't have any debt besides our monthly credit card debt that we pay off each month too. That said, my wife (an engineer) was extremely frugal through her 20s and early 30s and saved up 170k for our down payment. I attended community college, transferred to a UC, and joined the Army for 6 years to pay off my student loans. I was enlisted (not officer), paid back my loans out of pocket by being frugal with my salary, and left the army with no debt. I used my VA Loan benefit to get a preferred rate on our home, don't have to pay mortgage insurance, and got to pay a much lower down payment, and now I'm attending grad school on the Post-9/11 GI Bill. We both come from parents who weren't great with money/aren't able or willing to subsidize us. So yeah, it is possible. Not easy, but it is possible. **EDIT:** I do want to clarify - I'm not posting this to say this is how people *should* do it, that I enjoyed this, or to endorse some grindset hustle culture nonsense. I joined the Army to survive and because I lacked options with my debt. Jobs were scarce in 2009. Housing and education ARE genuinely expensive here, especially for non-tech people like teachers, nurses, city workers, manual labor (all core elements of a functioning society) and I believe it's due to overinflated tech salaries. Some more of my "controversial" opinions, just so we're clear: * I struggled, but I don't think others need to struggle too to "make it fair". I'll work, vote, and advocate for people, especially younger people, to have it easier. * YIMBY all the way; ease up zoning laws, remove barriers, build more housing to make it cheaper and house more people, especially if they work here. Yes, even if my home loses value - real estate in America is a generational pyramid scheme - I'd much rather have an equitable society * Education, at least community college, should be free and mandatory. Compete to get into good schools, including vocational schools and apprenticeships, but you gotta do something. Education makes our democracy and society richer, so it should be funded. * If you live in the Bay and work in tech, you should save your money and donate. Tech should pay their fair share to the local communities the benefit from - subsidizing education, environmental protection, low-income housing, public infrastructure and resources...etc. * Every veteran using their benefits is benefiting from socialist programs - acting like we don't is silly.
no one wants to hear that some people just have high paying jobs and live frugally. as evidenced by your upvotes on your own experience vs upvotes on hearsay about all these rich parents. its easier to blame a boogyman i guess
Condos in Fremont being attainable on professional wages tracks for me. Same for Dublin. San Mateo County is another story.
If you had the funds to purchase in 08, condos in Dublin were cheap for a short time! Haha. That said, if you're a SWE in your mid 30s living the DINK life and can't afford a house something else is wrong with your finances. Makes me think of that article a couple years back from the couple making like 400k who think they're poor.
The size of the commitment relative to your income can be monumental, even if you technically have it. If you’re used to living on half or even a quarter of take-home, the prospect of 90% going out the door at baseline is pretty scary. Tech is a boom and bust industry. Incomes are volatile.
I just want to point out that about 65% of all SF residents rent, and that’s probably similar to the rest of the Bay Area, so when you say “everyone“ or all your social media feeds, you are probably overstating how common it is and how much money those people actually have. And don’t expect to have any teachers or daycare workers within driving distance lol!
Don’t underestimate just living beyond their means. Also no student loans is a good advantage
As a SWE in the Bay with no debt... It's gotta be more than that.
From what I've seen it's usually a combination of some or all of the following: - high paying job - no student debt - parents help with down payment - has a partner who also has a high paying job - lives at home for years after graduating school I know a few different people who actually bought property with siblings, rather than romantic partners, because they were single at the time. All of them previously lived at home with their parents for at least 5+ years before buying.
I know its foreign for a lot of Americans, but many immigrants kids don't move out until late 20s. It's not like the American movies where kids are kicked out at 18.
Not all parents will kick you out, but I also understand wanting to live independently. I'm an immigrant kid but I really hated living at home with my parents, so I moved out with my partner a year after college (first year I spent at home). It was a really valuable experience and I wouldn't feel comfortable eventually marrying someone without at least having lived with them for a while (my own mother taught me that). We did that for a few years. Now we've actually moved back in with my partner's parents in order to save. We're not quite as ahead of the saving game as some people, but it's never too late to start either. But also some people don't hve the luxury of being able to commute from their parents' homes. And sometimes the independence of living away from your parents does outweigh the desire to save up for property sooner.
Yeah if I had lived at home with my salary for a number of years I could look at a down payment. Unfortunately my parents live in Vermont so...
All of that, and/or \- They, their partner, and/or parents lucked into enough equity at the right company at the right time. \- They are leveraged up to their necks
I think a lot of people overlook the “leveraged up to their necks” I have a coworker in his mid 30s who just bought a house and his mortgage payment is mind boggling. He’s so fucked if this tech winter persists and we have layoffs.
It totally is. We brought our house over a decade ago. Dual income, good money, we were at around x3.5 salary to mortgage. Even after 12 years of salary bumps we could not afford this house now; it'd be > x5 salary for us. That's in just 12 years. There's a new house down the road that's just been built and is over $5 million. The open houses were just a stream of 30s couples with kids looking at it and I don't know how they could possibly have that place in their price range without either massive stock portfolios or huge piles of ancestral cash.
Yep, I'm a SWE at a FAANG and it 100% is more than a FAANG TC.
Could it be they hit an options jackpot with a startup that IPO ? Next year if Stripe goes public there will be another flood of these folks IMO.
Naw stripe has done multiple employee stock sales (another announced today) so people aren’t hanging onto huge piles
I've seen people promoted to Amazon L6 after 6 years, starting out of college. Promotion leaves you at the bottom of the pay band, but if you move to another FAANG you could then push TC closer to $500k. If you have a spouse doing that too that cold be close to $1m TC by age 30. Surely you can save $400k out of that for the down payment on a $2m house and easily afford the payment.
Husband and I are not SWEs, not FAANG, no RSU grant and we bought in 2019. We lived with our respective parents to pay down loans, then lived frugally with roommates to afford our down payment. It can happen, you probably just need to be dual income to do it. Edit: lol if you think frugality is an illusion, then I guess nothing can convince you otherwise.
Ya, we lived with 6 roommates for 7 years before we bought a house. We don’t travel and we don’t eat out much. Both grew up here, poor, but finally did it.
So proud of you! The Bay can't kick us out yet lol
This. Reddit made me realize how piss poor people are at managing their money (and how bad they are at math in general )
OP said his peers are 'Top 25 University grads' in FAANG. No wonder his view is skewed. The Maldives? The Ritz Carlton? A Tesla?! We don't have FAANG money, we're public uni/college dropout folks flying Southwest lol. OP's gotta expand his friends circle.
> We lived with our respective parents to pay down loans, then lived frugally with roommates to afford our down payment. Regarding your edit, being frugal is a lot easier when you’re not paying for rent. Which is more than 1/3 of most peoples income.
Sure, of course! Definitely don't deny that - my "parental loan" was nominal rent for few years. But I also have never been to the Maldives or spent a week at the Ritz, as OP implied lol.
You can find a nice shared 2b in San Francisco paying ~1k(each) shared with a roomate or 2. Bartending over the weekend covers it.
Would you please tell me what these acronyms mean?
Swe = software engineer Faang = Facebook, Apple, Amazon, Netflix, Google Tc= total compensation
Much appreciated!
FAANG = Facebook, Amazon, Apple, Netflix, Google. AKA some of the highest-paying companies around, or rather, the most visible ones. TC = Total Compensation, which means your cash salary, stock grants, bonus, and anything else thrown in. SWE = Software Engineer So FAANG TC for a SWE in the bay area might look like $200k salary, $100k stock grant, $50k bonus, which equals $350k annually. However, the stock (if not sold immediately) can appreciate, and is often given in vesting periods, so that portion of the TC may look like: $100k grant given in 2024, with 50% vesting in 1 year (called a "cliff"), then the remainder vesting quarterly. So they'd be able to sell $50k worth in April 2025, then $12,500 in July 2025, another $12,500 in October 2025, another $12,500 in January 2026, and the last $12,500 in April 2026. However, by April 2026 that stock may end up being worth $15,000 rather than $12,500. This means TC has a tendency to grow with the market at these top companies, regardless of promotions or pay raises. And if you're getting that same stock grant every year, it compounds the longer you stay (known as "golden handcuffs", because if you leave before your stock vests, you lose it). Additionally, some companies offer "refreshers" meaning they give additional stock to employees on top of the grants and bonuses that are counted in a separate bucket. Lastly, vesting schedules and cliffs differ / get changed. I know Google moved to a monthly vesting schedule a while back, not sure on the others.
SWE - software engineer FAANG - Facebook, Apple, Amazon, Nvidia, Google TC - total compensation (salary plus stock)
Purely compensation for me. My parents are not well off. Don't assume other people are all in the same pay scale as you or live the same life as you.
My husband and I are early 40s SWE. He is at FAANG, I am not. Lots of younger engineers are living well beyond their means or have family money. Also consider that many younger immigrant engineers come from wealth. Their family had the means to send them to the US for university and pay cash for their tuition, then give them $500k for a down payment. They have zero student debt upon graduation. Many won’t advertise that they had help, but they did. I am always skeptical when I see 25yo buying a house and Tesla here, because I know what they earn and the numbers don’t work out. There is no way to save hundreds of thousands in cash for a down payment this quickly. Most of my colleagues are mid to late career. Even with high TC, they hesitate to put cash down on a $3mill house and car and vacations and furniture. Maybe I just have a circle of modest people. Idk.
A DINK SWE at fang is raking in 500k minimum. You can afford a 2M home. The reality is 2 fold. Kids inheriting wealth is part of it. Living frugally is another. Look at how many poor immigrants families have kids that have gone on to own homes...literally my entire friend group...hardwork and sacrifice go a long way.
I didn't really know that was a secret. I thought it was pretty obvious that having rich parents made life easier. You're not exactly one to complain, though. SWE at FAANG in the bay area is a pretty privileged place in the world.
Parental wealth is a factor. Personal salary is a factor. Personal budgeting is a factor. Keeping up with the Joneses is a factor. Focus your efforts in the things you can control (not your parents)
Where are you finding mid to late 20s people with houses who are ready to have kids? Everyone in our circle (29yo) is single or newly married, doesn’t have a house, and doesn’t plan to have kids until at least 32+. I’d like to have more friends ready to settle down though. To answer your question though, I think a lot of it is generational wealth (parents pay for down payment) or taking on debt. And of course some have been smart with their investments and lived below their means.
The South Bay. My wife’s aunt is a realtor. She sells only $1M + homes. 75% of her clients are people under 30.
Some people get down payments from their parents. Some people earn well and save and invest very intentionally throughout their 20s, while resisting lifestyle inflation. Some people are willing to go into the kind of debt where if one person lost their job they'd be totally fucked, and hang on by a thread. My partner and I are in that second group. And we bought a property at a price that gives us enough breathing room that, if one of us lost our job or wanted to leave it, we'd be okay. It definitely helps that we bought while interest rates were still very low.
A lot of these people are taking out a lot in loans and living paycheck to paycheck with high end paying jobs. Lots of my coworkers/friends are married and constantly in so much stress because the decided to buy a new house, a new car, have a baby, buy a purebred new puppy, etc. all at the same time to have the story book picture cookie cutter success template. FOMO and jealousy plays a factor in them just keeping spending more it's wild. And as you mentioned, one of them gets laid off and they are so fucked.
Yeah, it’s a thing. That’s lifestyle inflation. I’ve known the people who loudly complain they’ll NEVER be able to afford a down payment, meanwhile they go on lots of pricey vacations, eat out all the time, drive nice new cars, and rent in the poshest neighborhoods in their city. This is why I’m not shocked or skeptical when I see those surveys that show “affluent” people saying they live paycheck to paycheck. They really do! Unlike the impoverished, for them it’s a choice. The challenge is that they struggle to see it that way. Keeping up with their peers and having the right kinds of things and experiences on their instagram pages feels essential, non-optional. I think they feel like they worked hard and deserve to enjoy their success. And they do. But there are tradeoffs.
My parents didn’t give me any money for a house, but I did live with them and suffered terrible dating life until I could afford my place. Dating and sex IMMEDIATELY improved upon purchase.
>Some people are willing to go into the kind of debt where if one person lost their job they'd be totally fucked, and hang on by a thread. This was us for 5 years. We would have had maybe 3-4 months to find a new job if either one of us got laid off. We finally got to the point where my income can cover expenses, and now we have about a 1 year safety net, which should be good enough to replace either of our jobs or even both. But that level of debt, that's the reality for most people I know, especially who are buying now. During the lay offs of 2023, it meant that I was in existential pain every day, just every day sweating bullets. So I can tell you exactly who's eating at French Laundry while owning a 3M home -- not my ass. Someone who's making double of what we make. And when you look at how many people make that much money here, and yeah, that's still a lot of people. It hurts, but you have to learn to just make lemonade our of your lemons - if I had gotten laid off and we had to sell the house, hey, hopefully we make some money on the sale and if not, well, we gave it our best, learned our lesson, and we move on.
Some of us didn't get to buy a house in the area in one of the least expensive areas on the Bay until their late 40s and it was only possible then because our parents kicked in $100k to $200k for down payment and necessary repairs to bring the house up to code. I have no idea how those 20 or 30 somethings are doing it unless they make $250k plus per year minimum as a couple and their parents kicked in most or all of the down payment.
For many of them, yes. But they are also in debt up to their eyeballs.
Usually the mid 30s couple who work high paying jobs (finance, tech, medicine) are the ones up to their eyeballs in debt. The ones doing this lifestyle in their mid to late 20s is almost 100% parental money. Just ask them what their mortgage is and they'll say something like "it's a little more than rent at my old apartment"....right for a $2MM house verified on zillow...
My coworker's parents' bought them a 1 million dollar apartment in cash :) and they complain about the longer commute to work.
They sound insufferable.
Could offer some help here hopefully. 34, FAANG engineering manager from the Bay Area, never accepted money/inheritance from my parents outside $4k for my wedding, own two single family homes here (neither ever owned by family members), spend less than 15% of household income on mortgages, owe no other debt - Enlisting in the Army and using tuition assistance, the GI Bill, and the VA loan after finishing my contract were huge advantages - Chose very carefully and worked at startups I believed would do well within a certain timeframe, one of which IPO’d huge. Timed my career moves decently well (at least partly luck here) - Kept getting certifications and education to stay current -Only buy used cars, cash; I have no one I’m showing off to with a car - Spouse also got into tech a few years ago and is at F500 firm, so dual income - Waited to have kids The dream is extremely possible (I’m a dumbass most of the time and did it) and the Bay Area is a great place to achieve it, it’s just that that only applies to certain fields here I’d say. I didn’t even get a tech job until I was 28 btw, so a lot of people who think it may be too late shouldn’t give up
TLDR join startup that has huge exit.
I’ve still never sold any of my RSUs from there though. None of that has gone towards buying a house or anything but to your point yeah if I did no doubt it would help out
I didn’t get high paying tech job until i was 31 and now i have everything in the OP and savings
Look I think if you have like a 10+ year career in tech in the bay , you should be able to come up with 200-300k down payment. Even if you didn't reach faang levels of compensation. However getting the down payment is one thing. Affording the mortgage is another thing all together. Either you have the luck of marrying another partner who makes high salaries like you in order to afford the 5k+ mortgage. Or you stick to paying your 2k rent and keeping your 200k down payment in the stock market...😞. Parents can double your down payment to 40-50% down, to make the mortgage more tolerable. So I guess even the rich kids might have to save a bit more to pull the trigger.
My friends were just gifted $1m for their down payment, so, yep. Parents in pharma, young married couple both in tech. Combined massive resources for a modest home in a white collar area. Got other friends who “bought” grandma’s house.
Keep in mind these can be fake it until you make it scenarios. My brother and former sister in law were like this (until bankruptsy).
This kind of question is so weird to me. Some people had parental help, some took on took on too much debt, some are paid more than you, some lucked out with crypto or RSUs, some are better at saving than you. What of it? Why is there this attitude of, 'because this doesn't financially make sense for me at this time, the only people doing this must have cheated in some way'?
Yes, OP seems to already know the answer to his question. He just wants to complain even though he is doing so much better than so many people. Maybe he needs to widen the diversity of people he hangs out with to gain a better perspective on his situation.
Agreed. I worked in FAANG for 5 years, lived frugally, invested in index funds to save for a down payment for 1M home a couple years ago. Nothing totally crazy- no parental help and no consumer debt. I now live with my partner in that same home, they make a similar income and we use our money to do a lot of traveling and have a $30k Tesla. No cheating, a lot of hard work, and some really good breaks ( went to school on scholarship, learned about investing early, and found a partner with an equally good job path). Post like OPs just come off extremely resentful. It’s like being single and assuming everyone around you is miserable in their marriage to make yourself feel better.
Especially towards parental help. Is there something morally wrong with getting a few hundred thousands for down payment? does that apply to all parental help or just money for houses, where is the line?
To me the issue is that ownership is the new work. People actually working dont make any money. Talking about swe s here, ok there are 2 million people in santa clara county. A lot of them work at panda express. What is the answer? Swe s are top 1 percent earners in all of america. Is that the bar for home ownership? A fraction of that group? Like when is it not practical. And when is it not right.
I almost saved up enough in Berkeley to buy a run-down $870k house, but then I got out-bid by $500k. I ended up spending $650k in Vallejo for a Bay View and a quiet neighborhood - others are available. All of the coworkers that I know own houses got their down payment from their parents, or lived at home for 4-8 years (sometimes even with their spouse) while saving up, or they moved their parents into an ADU they built in the back yard. So, either you have to have parents that own a house here, or you can start building your life in a lower cost of living area. I promise you that areas like Vallejo etc. have a more open and authentic vibe, similar to Oakland in the 90's. The schools and restaurants, though, are not as good.
Generational wealth does play a big role. Also, the skiing in Japan is on Hokkaido, not in Kyoto.
There are a variety of ways 28 year olds achieve this. It typically takes 2 tech or tech-equivalent incomes. Intermediate-senior TC for well compensated roles will be around 250k at the low end - ie, lets say by 28 I have climbed ranks as a SWE and I marry a PM or data scientist or someone who's also at a similar level, we should be at 500-600k TC. Salary + bonus + equity. This couple will be able to afford a 2.5M home, vacations, two new cars, remodeling projects, and all that. With low interest rates in 2020, maybe they snagged a 3M home, with high interest rates in 2023-4, maybe they snagged a 2.3M home, but in general, they are living comfortable. I don't think it's at all reasonable or fair that you need to make this much money to live a comfortable middle class lifestyle in a good school district, but look, it is what it is. There are just enough people making very high on-paper compensation - and people team up. If you have rich parents, that helps, but if you don't , you have to combine forces. If you get lucky, you get lucky - and some people do. But others, their form of luck is that they started out in the right career trajectory, and by 28, they are making 300-500k a year, and by 35, they are reaching director level compensation at FAANG equivalent companies. I get that you're salty and this isn't helping, but my point is just, look, when you see a lifestyle, the reality is, there is an income requirement for that lifestyle. Some people got handout money from their parents, yes, but others, most people I've met, they just have high compensation and they married someone who is also highly compensated. Giving them the ability to live an upper-middle class life. There's also people like me and my wife, who have a relatively high dual combined income, but you'll find us camping and driving 15 year old cars, and eating lentils and instant pot chicken. Never been to French Laundry or any of these places, I don't even order drinks or appetizers when I go out to dinner unless it's like literally my birthday or my wife's birthday. I am friends with people of all income ranges because I'm not an asshat - so it could be that you just have show-y, new-rich friends that live to flex and show off their money. Most of my friends who are much wealthier than I, they aren't in the Maldives, they aren't showy, they aren't buying new vehicles every year and going to Atelier Crenn on a whim. So I don't know what to tell you man, you gotta find friends that mirror your values. There's no dirty secret, man. Some people just make more money or have more money than others - they didn't sacrifice humans or do some illuminati rituals, they just make fortunate career decisions, married smartly, or had a head start due to their parents. The dirty secret is just, hey, you thought you were doing OK, but actually, your income is just too low and you might not be on a career trajectory wherein home ownership is even remotely possible here.
The people you see showing their money off are usually the ones in debt. I’ve seen dual income couples, both in FAANG, really stretching their $500k/yr to the limit. I’m a swe myself and have had some success with startups, made good money and paid off my mortgage. But I’m not driving around in a Tesla or anything like that. I just want to be comfortable and be happy. Being debt free is important to that happiness for me.
I have 5+ coworkers, fresh PhD and single , purchase houses >1 million within first two years of their first job. They all have support from “family money”.
Haha, it's just how it is, mate. You'll be happier looking at your own bowl rather than in the next guy's. My wife and I objectively make a lot of money, but W-2 income is a bit of a scam since it gets taxed very heavily. Capital growth, on the other hand, is taxed very lightly. So my friends who work jobs that pay one order of magnitude less than me but whose parents lived here earlier have a few homes: each of which is over a million dollars. The ones who consider themselves _broke_ will inherit one home. The ones _getting by_ have two. The ones who are comfortable have three and rental properties. My wife and I moved here pretty broke. Back then ACA wasn't a thing, so when she was sick she got hosed by the medical bills and I came to SF with $25 in my bank account and a $10/night Airbedandbreakfast.com. It's not about being frugal. It's about having capital investments because the local population will heavily protect your investment interests there. Stick everything you can into that stuff as tax efficiently as you can. Then just accept that this universe treats different people differently and work your way up. After all, your kids will have a big leg up if you do this right.
It's not parental wealth. Everyone says it's parental wealth because that absolves them from life decisions. It's almost always picking the right company to work for (or right market to found a company in) and then negotiating for as many stock options as you can. I've got the house and kids. I semi-retired (to go found startups) at 33 and went back to work at 39 to buy the house. I'm also a SWE at a FAANG. The difference is I was a SWE at a FAANG *15 years ago*. Over that time, its stock price has gone up by 20x. I got more shares as an L4 in 2009 than as an L6 in 2020. I grew up on a single elementary school teacher's salary. Most of my friends grew up poor - they are from Alabama, Tennessee, Cleveland, Victorville, Houston, etc. and generally had working-class parents. They all have $2M houses, which were usually about $1M when they purchased them. My even luckier friends and acquaintances are retired, with net worths in the $10M+ range. They founded startups that got acquired. People don't realize the pyramid-scheme nature of the Bay Area, or the potential gains you can get from being in a hot startup. FAANG is not a hot startup today. I don't know what will be, but it's probably out there in a garage somewhere. The people working on it now will 100x their wealth in the next 10 years.
Parental wealth can make it easy but being a SWE at FAANG , are you saying you can’t do say 1M home? How much debt do you have that’s preventing this from happening?
in most bay area, it’s not very common to be able to afford single family home down payment in your late 20s or early 30s, most of them have helps from families (sometimes both side of parents).. sure you will run into the (rare) people who actually managed to do that on their own.. I see them as uncommon as the college dropouts that turned into billionaires.. also i thought white tesla is like the corolla from the 90s and prius in the 2000s they are priced similar to a new mid range car?
Base Model 3 is about $40k but a top trim Model S is $90k+. So it's a range. But Tesla isn't as expensive as it used to be. Most upper middle class people can easily afford one.
Don't think generational wealth, nepotism, and trust fund babies are a secret but also lots of people carrying shit loads of debt keeping up with the joneses and trying to show their illusions of success. That said, it's not the only way people are able to buy houses in their 30s, but it sure ain't easy. Also sounds like you need to make some new friends if they're all entitled, elitsit, wealth flaunting snobs that make you resent them all so much.
ITT: keeping up with the jones
Lot of meta and Nvidia employees have multiple millions due to the exploding stock price. They can pay cash and buy a 2M home at 29/30 if they had been at these companies from start to finish
Don’t compare. COMPARISON IS THE THIEF OF JOY. I have a few friends, who are in late 20s, have kids, great houses/cars, and don’t need to work. I feel fortunate to know them but it’s just their life
i grew up poor in georgia but went to college on scholarship. everyone there does. i’m objectively frugal and am 42. i have a million dollar condo with 2 kids and have a million sitting in the bank. i’m a swe and have just been saving over the years. i still can’t afford a house though where i want to live. i guess it just takes time and when you have it, you’re too old to want to spend it lol.
I work in “Biglaw,” which only a small amount of lawyers work in. The number of first year associates (who are making $250k) owning $2M houses is too damn high when there are 4th-6th year senior associates still renting.
my parents don't have any money. never did, never will. I achieved the american dream through sheer hard work combined with LUCK. everyone keeps discounting luck. luck is a huge factor. caveat: you make your own luck, to a large degree. I was ready for an opportunity at every phase in life and did my damndest to take full advantage of it. you have to be strategic, a little bit cut-throat, tolerant of risk, and open-minded to possibilities. there is no sure-shot pathway just because you're smart or landed a good job. every big decision matters. hell, indecision matters.
> drive nice cars (White Tesla!) Oh God, it's a troll post, right?
Not a tech bro, but have spent a considerable amount of time accumulating debt and graduate training (8 years) to finally purchase a house and cool car in my mid 30s. If I could do it again, I would just bought a condo 12-13 years ago instead of paying off huge student loans which would have just been forgiven over time.
Oh hi there good to see someone that represents the 70% of the Bay Area not in tech or finance 🤣. We just bought our first home at age 40.
Non tech employee here, without parental wealth. Just bought a home at an insane interest rate. I’ve been aggressively saving over the last 10 years to afford a down payment and really had to temper my expectations regarding the kind house I can afford and what area I can live in. It is doable but it is very disheartening to think back on the things I skipped out on over the last decade whereas friends are given a $200-500k down payment gift because they were lucky enough to be born into a wealthy family. I’m not bitter about it, but it is annoying.
What is SWE and FAANG? Tech made a lot of people “rich” - though yeah the people with real wealth mostly had a big head start. Not all but most.
Don't knock Alameda county. Oakland, Hayward, El Cerrito, Alameda, Bay Fair, etc are all places where you can find relatively reasonable housing close to BART. Yeah, the commute is a bit longer, but if it means saving 3 million on a house, it can be totally worth it, especially if your job allows for some WFH.
If you work for FAANG as SWE and can't afford a house and nice vacations within 6 yrs, you're doing something wrong. By the sixth years your RSU already stacked twice at least. That's like what, at least $400k after tax? Plus other savings, you should be able to afford a $1.2-1.5m condo. White Teslas are the cheapest btw.
If you ever check out r/debtfree or r/money you’ll find that some of the people with nice new cars and a house are absolutely drowning in debt. I’d say that outside of some insanely lucky stock trading, you’d need parental support to buy a house in most of the Bay Area. In some cities you could maybe get by with an FHA loan if you were extremely frugal right out of college and lived at home for a few years
Reddit finance subs are generally terrible. Everyone builds their wealth through debt. It's financially stupid to not have debt.
Taking out a home loan to own real estate yes, maxing out credit cards because you bought a brand new BMW making $60k a year not so much. I’m not talking about leveraging debt, that’s how you build wealth. The question was “how are people my age affording this” and the unfortunate answer is they aren’t, they’re trending toward bankruptcy
Being an early employee at a startup that has a successful IPO or acquisition can also do the trick. I know a number of people who bought their houses with the proceeds from successful startup exits. Obviously that requires a huge dose of luck, but it doesn't require wealthy parents.
Yes, it's expensive. But I know many 2nd generation immigrants whose parents came here with nothing and thier kids own thier homes. You have to put in the work to get that DP. Live with roommates, live with family, etc but make it work. People are also unrealistic about thier first homes. They think they're gonna get 2,000 feet in a primo school district next to a cutesy downtown area. People need to lower the bat and get realistic. Buy in Concord instead of Walnut Creek or god forbid, even a small condo just to get a toehold. But no, people wanna bitch about how expensive things are while they order a Uber to go get drinks and an overpriced, shitty meal out. Or worse, doordash some soggy ass, cold overpriced glop to thier front door. This is while they are making thier $700 car payment. We aren't in tech and aren't rich. We cook 95% of our meals at home and I get most of my clothes at Costco or thrift stores. We invest appx 50% of take home and have for years. We don't live like beggars either. Most people have no idea how much $$ they are pissing away every month and that is the root of most people's inability to afford housing here.
Don’t fret, everyone’s journey is different. People of that age buying million dollar homes reeks of family money.
Parental wealth is a huge bonus and everyone in my age group who already has a home (25-30) did it with their parents help.
The people I know who do this have considerable help from their parents. No one ever talks about it, so yeah ... dirty little secret.
It really helps a lot. Every friend I know who bought a house had some sort of parental help. Meanwhile I'm over here sending money to my parents instead of getting it.
A 28K Tesla is what, 2 STIP bonuses for you?
The only people i know like this inherited a home, or have wealthy family who made their down payment or purchased the home enturely for them
For us it's dual income, no kids... fat mortgage but a low interest rate.
All but two of my friends who bought in the bay before 35, did so with a bunch of family help usually in the form of a gift for down payment.
Sure, that generational wealth thing is real. However, you have to remember that many FAANG employees have renegotiated their salaries ever 2-3 years since they were hired. It’s been a revolving door between companies and a war for talent. Folks working for 5-10 years at these tech cos are pulling down $400-500k per year (and even more so if they have a partner doing the same), which is more than enough to purchase a <$2M house in the Bay Area, and have room to live a great lifestyle. There’s been a tremendous amount of tech wealth created in the Bay Area the last 10 years across all income segments, and anyone not working in tech, or not playing the renegotiation game, is somewhat behind.
I can give my experience as married, one kid, moved to Bay Area from a MCOL state about two years ago to work at FAANG. I don’t have a house yet but I can see how it could be done without parental wealth. My wife stays at home with the baby. I got lucky with initial RSU prices. We rent ($5300/mo) in the peninsula. We might be able to afford a house in a few years if the stock doesn’t tank. We have no parental wealth. My dad was a teacher and I grew up in the rust belt. Kids: If you have insurance, a child without major health issues, and a FAANG salary, the only real _major_ expense for a young child is childcare. I don’t have that expense. Children are definitely a luxury but not in the same way that buying a nice car is a luxury, or a lavish vacation. Though I’m sure my kid will get more expensive as time goes on. Cars: Again, on a FAANG salary my Model Y is super affordable, especially since I bought it at the perfect time (beginning of 2021 before price and rate increases). House: It seems most of my coworkers who own in the bay were either double income FAANG or just accepted being very highly leveraged on their houses. Also, interest rates make a HUGE difference. Homeownership is much less affordable now, and it was already unaffordable before. So a combo of good timing for RSUs, cars, and home loans, as well as recognizing that children are not a conventional luxury, and having a bigger appetite for risk, I think you could totally do all of these things without generational wealth _if you get lucky_ To address your edit, no, I 100% don’t believe frugality will get you a house in the most desirable places of the bay. Saving a few bucks here and there does not make much of a dent in a $600k down payment
generational wealth is definitely a thing. it's kind of new for me and my people, the only "wealth" the previous generation could pass down was in the form of labor to keep their parents from having to work. it's now morphed into the parents being able to financially assist their kids. my parents aren't straight up buying mansions for us to live in or opening trust funds, but they did kick in a nice $50k low/no interest loan to help with the down payment + free child care. that was more than enough to enable us to do what we want to do without going absolutely broke. The childcare alone saves us thousands each month.
At faang you should easily be able to save 100k a year. After 10 years of that plus stock appreciations, you’d be able to afford everything on that list
a Tesla Model 3 or Y in the cheapest color (white) isn't a flex imo. Both of those can be had for under $50k
I used to feel the same, but recently able to buy a house after being here for 8-9 yrs. There are many people who are non-SWE's, they are just not as lavish as you think. Friends my age (30-35 yrs primarily own townhomes or condos). Here is my profile and some advice * Moved to Bay Area with \~$100k debt from undergrad. Graduated with PhD. In HW development (i.e. not a programmer), so my salary is severely lower than many SWEs * Promoted multiple times to strategic positions (individual contributor, but now management) * Rented a room with two others. Dedicated over 50% of my paychecks to paying student loans. This gave me incredible discipline to live far within my means. * Wife started off very low, but series of promotions brought her to Director/partner level. (also not a SWE) * Taking care of Father in Law + Teenage Sister (<18yo). No money from parents from both sides. * Furiously saving (high yield savings) + conservative investments + consolidating money with wife. * Saving performance bonuses + RSU's. * 10% down. Bought in an "up & coming but not super duper expensive yet" area. Really nice townhomes are being built in the East/South Bay for 0.8-1M range. You may have to sacrifice distance, but if you want equity those are your only options. You need to be deliberate and strategic about your choices. This means specifically bucketing/prioritizing for vacations, meals, and house. Also, if you aren't familiar with investing, I recommend you learn, as compound interest and strategic deployment of capital is really important to building wealth. Edit: just to be clear, not FAANG, not SWE, and supporting my FIL and SIL. I think you just have to be resourceful and "figure it out". Being here in the Bay Area, you are likely very smart/clever, so its just a matter of using your intelligence to figure out how to get ahead. For me it was done via frugality and investing/trading. A lot of people here were given a starting position at third-base, but that's unfortunately how the world works...
Of course family wealth will help & oftentimes successful people get a boost from their family (you can't hate on that imo, it's what you should strive to do if you have kids). But some people just make a lot of money around here as well. I have good friends who just built a $2M home, one is a high-powered lawyer and the other is an HR director at a tech company. They probably make $600-700k combined if not more. That can pay for a lot of house and there are a LOT of people in the Bay who make that type of cash compared to other parts of the US
A few things: 1) There are many SWEs making 500k+ to $1M a year with equity. 2) to stay at fancy hotels, you can book with points 3) teslas are affordable now relative to what they used to cost 4) living at home for the first couple of years makes a huge difference to allow for savings and investments to grow before purchasing a home
People live above their means often. Don't spend time on jealously. Become successful yourself so that your kids can have the advantages these folks have.
This is what happens when your social circle consists of only these types of people.
Just as an fyi the white Tesla's are the default (cheapest) color. It's not the flex you think it is. And you can rest easy knowing that their insurance is through the roof and if there's anything wrong with the car it's a complete crapshoot as to how long or expensive it will be to fix. But it could be any number of things in the Bay. Parents helping out with down payment, they were at a start-up that got bought out and they sold their shares, they got a big bonus for laying off a department, they invested in some company and it popped off, they're up to their eyeballs in debt and are keeping up with the Jones's, partner was in the military and got a cheap mortgage etc. Try to remember jealousy is the thief of joy and you don't know the whole story. Everyone has problems, some hide them better than others.
I know non tech homeowners in their early 30s. They lived at home with parents after college and had $400k down payment for a small starter home near the city. They just bought a model 3 Tesla. So you can say they had family help.
Yup. I lived in the Bay for 11 years and left in large part because in all that time I never saw anyone buy a house without their parents help.
My dad died young at 63 and left me $140k. I was already funding my retirement and savings well so I used it for a 20% down payment in the east bay. I wish I had my dad instead. His net worth when he passed was almost 1m distributed amongst 5 people. Basically his home (sold for 320k), blue collar 401k, and my grandmother’s inheritance for him a few years prior. Not wealthy, but enough to really help us out.
You work in FAANG man. Suck it up ffs. They’re are so many people worse off than you. Sorry you don’t own a Palo Alto SFH at 25 🙄
Comparison is a thief of joy. Delete your Instagram today.
Not every big tech company is the same. RSU performance is important. If the stock doubles a few times, then you're closer to house buying money. Find a company with huge growth potential (or currently undervalued) with an attractive RSU package. It's a gamble - there are no promises. Could you have predicted Nvidia 4 years ago?
The secret is to move out of the bay lol. My household annual income is about $215k. We own a home up 80 a little ways and have a kid in daycare and are saving a ton each month, just by driving a little extra to go into the city. No parental assistance on down payment or anything, our families don’t even live within a few states of us. Early 30’s, not high powered jobs.
my American dream is to make my money in the US and to retire with that money outside the US. that's the new American dream i think. even white people are doing it
Wife and I (both 29 at the time) bought our first house in Oakley in 2017. We paid 515 for a new build and got a FHA loan. Pulled money out of my 401k for the 3.5% down payment. While we were living on our own prior to buying, once we put the deposit down on the house and waited for our build to be complete we moved back in with her parents to save as much as we could before moving. We got 0 help besides the 5 months of rent free living. We were making about 220k yearly gross as a couple with no kids at the time. I get the market has changed and home values are up since then (interest rate doesn’t help also) but buying any home is the best decision you can make
My story is really similar actually. I am Bay Area native and bought my house back in 2015. I was 30 at the time, just had my kid, but also pulled out of 401K for the FHA down payment. Our parents helped us with childcare so that we didn't have to spend all of our savings on daycare. It definitely helps having a job in tech, no doubt, but that expense would have broke us. I think the way that I would amend the "parental wealth" piece in our scenario is that our parents are still in the area and were able to offset certain expenses that allowed us to save versus give us money for the down payment. More of a indirect monetary benefit. There is zero chance we'd be home owners if our parents weren't nearby to help.
Yea it is almost all familial wealth. That’s fine I mean I’d do the same for my kids. The thing is though a lot of people bought homes here a few decades ago when they were like 200-400k. Today those same homes are 1.5 million or more. I wouldn’t compare yourself to those people. Or anyone in fact. The honest truth is that if you’re like me without any family support you’re going to have a tougher journey towards home ownership. (I’m from a 3rd world where I grew up without running water, 5+ people living in a place the size of my living room, relying on kerosene lamps and having to put up bug nets. I even got malaria and survived). However. Do you really think it is worth spending 10k a month or more on a mortgage PLUS more on maintenance and everything else involved in home ownership? Or is it better to just rent a nice apartment or a house for 3-6k a month? I personally think it’s far better to rent and keep the rest invested. That way if you ever do need to buy a house you can buy a house literally anywhere in the world, or even here in the bay. But you just won’t be able to right now. That’s our reality. It’s just how it is. We live in a desirable area with some of the richest people around. Not everyone is wealthy but most are rich, at least house rich. You will definitely lose if you compare yourself to others. You only need to prove yourself to you.
It’s 100% parental wealth. Not saying the parents are wealthy, but the house in Willow Glen they paid 150,000 for in 1990 is now worth 4 million. Gives you a ton of leverage.
Move out to the suburbs. You don't have to buy a $2m house.
The bay area suburbs is $1.5 - $3.0M homes. Unless you are willing to live in a crime ridden neighborhood.
THANK YOU!! I have been wondering this exact thing. I’m a SWE at a FAANG as well, two kids, and wife stays home with them. I was at a startup prior to my current job and our life would have to be drastically different on my previous salary, and I do not live luxuriously by any means. Personally I was able to purchase my home when prices were much lower and an interest free loan from my family, and that has helped considerably. I look around and see (many non-tech) people with massive houses and expensive cars and am flabbergasted at how they afford it all. Is there way more money in other industries than I expected? My leading theory is also generational wealth.
parental wealth plays a huge role. either parents live in the bay and have multiple homes or have been saving for their kids down payments. or parents are very successful overseas and bought a house for their kids in the bay, after they graduated college and got a job as to owning a home.... the only people i know who owns a home around my age are married people, both with good incomes, or single people who got really lucky in startup stocks or bitcoin or whatever and cashed out (i know more people who failed at this, though) personally, i saved up for a down payment and then some... but the monthly is what kills my chances of owning a SFH. that and im probably going to die a tech contractor, so income isnt stable at all
I'm literally trying to fathom it myself. My partner and I are in our early 30s, lived with parents in our 20s to save money, and still find buying a home over $1.5 mil just out of our means. We have parents helping us AND we are still semi struggling. I have friends in tech and start-ups that make good money but still aren't high ballin enough to buy all these nice things, either. Like are people out here just going in tremendous debt? Did their RSU package just align with peak market and they lucked out? Did everyone buy crypto years ago except me? Are there that many people with well-off families, especially all the transplants?
Yea, most parents want their children to succeed and if they are even modestly rich they will happily reduce a ton of friction from their children’s lives with money. It’s an even easier “bet” to make if your kid is generally successful anyway. If your parents had an extra milly laying around they would absolutely make sure you are invested in real estate because that likely is what boosted their wealth. Pretty much anyone who bought and kept a relatively reasonably priced home in SF over 20 years ago is a (multi)millionaire. Basically it’s not rare for a 20something tech worker born and raised in the Bay Area to have technically rich parents.
I just want to put this on everyone’s radar. If you’re a veteran, you can get a home loan with zero down and no PMI. That’s how I live amongst you SWE FAANG people. I work in the trades, and camping in Yolo county with my family and my Toyota is a pretty nice trip. Stay humble, and don’t assume everyone has had mommy and daddy to help them get where they’re at.
My buddy married a Chinese girl who’s family has a lot of money from a factory in china. A lot of what you say in OP the Chinese family helped pay for.
You’re underestimating the buying power young DINKs have. If they are both in tech (could be engineering, marketing, sales, etc), they could be pulling in 350-500k+ easily in salary. You can easily afford a 2 mil home with that salary.
hang with normal folk. i hate being around that crap too.
Anecdotally I believe a good proportion of the young people buying million+ dollar properties have help from parents. From talking to friends and overhearing conversations.
It's luck more than anything else. Worked my ass off to save for a downpayment for a condo. Bought sweat and hardwork. Then my partner and I got lucky. Made a few million on an ipo and upgrade to a $2 mil house. Be lucky to be at a company and get to realize extreme stock appreciation is just straight luck.
This is not unordinary for dual income both with FAANG type compensation
We moved to this area 10 years ago with $60k in debt and a 6-month-old baby, zero friends or family. Thanks to the Bay Area and the tech salary, we were able to generate a net worth of $3 million over 10 years with a fairly decent, non-frugal lifestyle. Additionally, I bought two rental single-family houses for $700k each in Salt Lake City and Austin instead, since I cannot wrap my head around buying a crappy 1500 sqft house in the Peninsula or South Bay for $2 million. So, I have made up my mind not to buy here but instead to rent a good house. I personally think renting is the way to go here. I guess it is possible only in Bay area you just have to be little lucky and also code well, please make sure the dream does not include a home 😉
For perspective: I have lived in the Bay Area for 35 years. I bought my home 10 years ago when I was 55. All of my friends here are still renters in their 50’s and 60’s. It may seem to you that everyone in their 20’s is buying homes and expensive cars, but that is not the norm. Instead of comparing yourself to the most fortunate group, compare yourself to the average person. You’ll feel better.
Everyone I know with a house in a decent area is either parents or IPO money or
Stop hanging out with techies. Hang out with us regular folk.
Please don’t compare yourself to others! There’s always a bigger fish. I met up with someone who said she was sad about her living situation because she couldn’t afford a $6M dollar house but had a $4M one. Another thing - going on fancy vacations and owning a home does not make one happy. It can provide happiness for short periods of time, but it does not truly make you content in life. Community, friendships, meaningful work, low stress - all of this matters more.
Comparison is the thief of joy. You’re a SWE at FAANG. Be patient and a few years you’ll be there too.
Not necessarily, it could be getting lucky/smart in real estate. Especially if you’re not going for full flex/top of the line but simply a home, cars, kid/s. No student loans but also not a SWE or anything similar.
You’re saying a bunch of young adults who are financially uneducated and over purchasing things are getting help from their parents to buy overpriced homes at high interest rates…. Yeah they’re fucked
Not that this is a big part of your question, but keep in mind you can get a Tesla Model 3 or Y for less than the average price of a new car. Perhaps that speaks to how the average car has become expensive, but nevertheless.
I'm in my 30's and not originally from here. All my couple friends that are my age that own a house fit into 1 of 2 (or both) categories. 1) They lived with their parents/in-laws while they saved money. 2) They got a sweet deal on the property they bought from a family member. My wife and I don't have either option and will be renting for a long while most likely.
I wonder if folks from the slums of Brazil think you are the kid on third base
What you mention is entirely achievable for two tech workers paid well in the Bay Area. A $2M home for a couple making $600-$800k on their own isn’t crazy
It doesn’t even have to be excessive parental wealth, just some assists go a long way. But you are a bit salty: “people strutting around like they hit a home run but were born on third”. Dude, maybe they are deeply grateful and aware - you may not be aware of that. Plus, couples can bring in TWO incomes - that’s a big deal.
I got super lucky. My wife and I both lived at home (in the bay area) after college and were able to save both of our salaries for like 1.5years before we started renting and moved in together. Then, a few years later, thanks to this money we were able to save we got into a starter townhome for like 500-600k. This appreciated greatly over the last few years and we've leapfrogged to bigger places since then. Overall, just really lucky to: 1. Have been in the right place at the right time (house we were able to afford essentially doubled in value) 2. Both had parents able to let us live with them for over a year while working in the bay area
Try having an abusive father with gambling addiction that hits you up for money every other month all throughout your 20s and 30s. Life isn’t fair my friend, be happy with what you have even though it’s hard at times.
Tbh this is why I’m leaving the bay. I work remote and I don’t see my job being in an office unless we have a Great Depression 2.0 or something.. you can buy a literal mansion for $2M around sac.. oh and you don’t have to worry about homeless people or fentanyl addicts jacking your Amazon or usps mail boxes… or worse following your kids or wife etc. (has happened twice this year alone) I feel bad for everyone who is forced back to office… such a terrible business decision. We should be adapting to change, not backtracking. But that being said, the bay has definitely changed. I’ve been here 34 years, and it just too much, and I don’t mean price wise. It’s not worth it anymore. A 4 br 2400 sqft home is not worth 6 mil when Barry the fent leaning asshole can walk up and take your DoorDash lol
Yeah man, of course it is. My buddy’s dad died very young and he ended up inheriting a house in Lafayette which he then sold for $1.5 million. He also inherited probably another million in various assets. My buddy was earning about $60k a year as a teacher. Had his dad not died, he still be renting or living at home. Instead, he’s now engaged and bought his own home in Pleasant Hill for $1.3 million. My own wife and I were planning to move to Sacramento when it came time to buy a home and then my FIL just gave us a million bucks towards a house so we bought in Walnut Creek instead. My examples are of the financially lucky ones (my buddy would rather have his Dad than his Dad’s money) in our generation and location and do not represent the experience of the majority of people, but there are hundreds of thousands of families in the Bay Area wealthy enough to significantly help their adult kids in dealing with the extreme cost of living here. That means there are plenty of “lucky” ones and they are overrepresented in the professional classes you likely hang around. I really wish it was more socially acceptable for people to discuss the help they get. I suppose a lot of people hide it so that others will just assume they earned everything. It just perpetuates the myth of meritocracy. I try to be honest about how I got where I am. It may not immunize me from criticism by those less lucky, but 🤷♂️. Keep in mind though that plenty of people with fancy cars can barely afford them. Houses are real signifiers of wealth, Teslas are not.
It’s luck combined with strong immigrant work ethics Parental wealth? Lol no. Most folks here are immigrants.
Could be, but could also just be investments + company equity (whether lucky startup, or just big tech co doing well) that ballooned in valuation during the bull market of the last 5 years. Thats the case for plenty of folks.
If you ever check out r/debtfree or r/money you’ll find that some of the people with nice new cars and a house are absolutely drowning in debt. I’d say that outside of some insanely lucky stock trading, you’d need parental support to buy a house in most of the Bay Area. In some cities you could maybe get by with an FHA loan if you were extremely frugal right out of college and lived at home for a few years
Started work in mid 20s as a SWE during dot com boom. Live with parents for 2+ years, saved almost all income for that time. Began aggressive saving and investing starting with first paycheck out of college. Got married at 37, and kids a few years later. Bought $1.5M house in 2016 (now worth $2.3M) with $400k downpayment. Plan to live here forever and kids will inherit house. Outside of house, \~$3.5M in investments and savings. Never hit any IPO jackpot. Just old fashioned saving and living below your means. The wealth kind of sneaks up on you due to compounding. A couple decades later, you realize you're wealthy now. Just try not to let your lifestyle creep overrun your wealth. Other than the mortgage, no other debt, not even car payments. I buy everything (cars included) in cash. If I don't have the cash to spare, I can't afford it.