Pricey House Rents Scare Tech Workers Away From San Francisco
San Francisco, popularly known as a social media mecca that’s home to Uber Technologies Inc., Twitter Inc., and Airbnb Inc. may be running out of savvy-tech workers these days. Why? Expensive house rents in the city are driving tech-workers to move out and relocate to Seattle, Portland and Los Angeles.
According to Zillow data, San Francisco’s average house value was $1.1 million and the average monthly rent was $4,547 in February, the highest among the 50 largest American cities.
So this number is scary enough to drive David Nichols, 34, chief executive officer of Automation Resources Group to move to Portland, Oregon, together with his pregnant wife. Once they learned the house rent is expected to soar 50 percent, without hesitation, they left San Francisco.
“When you look elsewhere, the cost of living is totally different.” – David Nichols.
Goodbye San Francisco, Hello Portland
Like Mr. Nichols, many are jumping onto the wagon and saying goodbye to San Francisco.
Looking for affordable cost of living and high quality of life, tech workers move to Seattle, Denver, Austin and the Los Angeles areas.
Mehul Patel, CEO at Hired Inc., a San Francisco startup that connects job seekers to employers said re-locations out of San Francisco are increasing.
“If you actually factor in cost of living, there are much better places to live.” – Mr. Patel
Tech workers consider San Francisco as the best place to establish themselves before moving to more affordable places to live.
Tech Job Growth Going Down in San Francisco
San Francisco may lose its reputation as a tech hub because it is becoming pricey for tech workers. And they really are running away from the expensive city. Tech employment is affected too. In fact, tech job growth in San Francisco is only 5 percent this year compared to a 10.3 percent increase last year. In comparison, tech job growth is accelerating in Seattle with 7.8 percent and 7.6 percent in Portland.
Zillow data shows home prices in those cities are at least half of those in San Francisco, with an average cost of $351,700 in Portland, $536,700 in Seattle and $569,500 in Los Angeles.
Oops Not All Are Leaving San Francisco
Amid decline in job postings in San Francisco and to mention the pricey cost of living, some tech workers still consider the tech hub city as the best place to live. And, some tech workers stay they can afford iit because they have high-paying jobs.
This was attested to by Huey Lin, chief operating officer at Affirm Inc., a San Francisco-based lending startup. She said people are still drawn to the area despite the expensive cost of living and higher house rents.
“While they may be potentially paying higher rents to live in smaller homes, this is a sacrifice they are willing to make to work in a highly innovative environment, be surrounded by nature and enjoy pristine weather year round.” – Ms. Lin told Bloomberg.
Also, some have moved just a small distance, such as to Oakland, the Oakland Hills or other places where the rents and home prices are lower. It just means commuting if their offices are right in San Francisco, or further down in the Bay area.
Lifestyle and weather can help keep people in the Bay area, too. The number of annual days of sunshine is much higher in San Francisco and further down the bay, than in often-dreary and rainy“While they may be potentially paying higher rents to live in smaller homes, this is a sacrifice they are willing to make to work in a highly innovative environment, be surrounded by nature and enjoy pristine weather year round.” Seattle.