by Reginald Sylvester
What’s the biggest problem in Northern California today? Affordable Housing.
San Francisco, San Jose and Oakland California are 3 of the six most expensive places to live in America.
According to Zillow, Alameda County’s Median Home Price today is $869,100.
The median rent in the San Francisco, Oakland and Hayward area is $3,300 per month. That’s $198,000 in rent payments, over a 5-year period.
That’s more than the median home value in 26 other states.
The median home price in America today is only $225,300.
In Oakland, you can easily rent a 2-bedroom apartment for $2,500 per month. That’s $150,000 in rent payments over a 5-year period.
As a result of these rising home prices, many Bay Area families must decide, continue to rent or move to areas where they can afford to buy.
The median household income in Alameda County is $85,743. That’s $7,145.25 per month. According to the California Housing Partnership Corporation (CHPC), Alameda County residents need to earn at least $7,547 a month, just to afford the average asking rent.
That same monthly payment can buy a 5-bedroom, 3 bath, 2,500 sq. ft home in San Joaquin County.
The most common objection is the commute.
Many people don’t want to drive 90 minutes to work every day. However, more families are beginning see the value in driving 90 minutes everyday to a home they own.
The truth is, the extra 2 hours a day they will spend commuting, may prove to be the most profitable 2 hours of their day. The increase in home equity and principal reduction over time, may out turn out to be their best investments.
Let’s look at the facts:
The illustration below, show’s a side by side comparison of what will happen in the next 5 years for the family who continues to rent vs the family that buys a home.
The above illustration shows that buying a home in San Joaquin County is a far better investment after 5 years.
As far as commuting, it’s no longer an option for many who wish to buy. It’s a necessity.
Many people can remember a time when places like Pleasanton, Livermore, Hayward, Fremont, Walnut Creek, Concord, San Ramon and Danville. All were considered ‘way out’ and ‘too far to drive’. Today, they’re all considered prime real estate.
San Joaquin County now seems to be prime real estate for today and tomorrow.