The current explosion San Francisco has seen recently in terms of being a hub for startup innovation is largely based on technology. Twitter, Uber, and Airbnb all call San Francisco home and they, and companies like them, have been attracting workers to the city and compensating them very nicely for a while now. But as more and more highly paid, skilled workers flow into the city of 800,000, the higher the prices of homes and apartment rentals are becoming.
In February, as Bloomberg reports, the median home price in San Francisco was $1.1 million and the median monthly rent was $4,547. Remember, those are median numbers, meaning half of all homes and apartment rentals cost more than that. With prices like these, even those making six figures can find it difficult to afford to live in San Francisco.
Many have already decided enough’s enough and are fleeing the city and its king-size housing costs and are heading to areas like Seattle, Denver, Austin, and Los Angeles. Over the last year, there has been a constant flow of workers out of San Francisco and into these areas. Cities like Denver, Seattle, and Austin have all become very tech-savvy cities in their own right and, while not exactly cheap, have housing costs that will feel like a cool balm being applied to the burns left by San Francisco. Seattle, for example, has a median home value of $536,700, less than half of what San Francisco offers.
For the year ending in February, tech employment (Internet, software-publishing, and data-hosting companies) grew 5 percent in San Francisco, which was down from a 10.3 percent increase for the prior year. Meanwhile, in cities like Seattle, Portland, and Phoenix, job growth in the tech industry is increasing correspondingly at 7.8 percent, 7.6 percent, and 5.8 percent.
While San Francisco is still growing, the growth is definitely starting to slow as surrounding cities begin to offer similar amenities and lifestyles without such excessively high costs.