House hunting in the Valley
April 19, 2004
It’s hard to get over the sticker shock of buying a house in the Bay Area. America’s median home price of $205,500 will not quite get you a mobile home. $500K buys you (literally) a shack with a dirt yard in a semi-crummy neighborhood. You barely reach the comforts enjoyed by most of America’s middle class (small yard, 2 bathtubs, family room, dining room) at $700K. And this is at the end of a recession when a lot of people have moved away!
There are really only two ways to buy a house here. You can work as an engineer for like 10 years, saving diligently and never getting laid off; or you can win the lottery. This can be the genetic lottery of having rich parents, the stock option lottery, or an actual lottery. Almost all the people I know who own houses took the lottery approach. In fact, when you start a job with a startup, lots of people calibrate their potential option grants in terms like, “If we get sold, I’ll have a down payment; if we IPO, I’ll have a house.”
We’ve now looked at a bewildering array of houses, after which we settled on pretty much what we thought we wanted in the first place: a 40-year old ranch house in Sunnyvale with 3 bedrooms and 2 bathrooms. Last month we made an offer on a house, but at the last minute someone outbid us by $50K. We almost made an offer on a different place, but the subfloor there turned out to be almost entirely eaten by termites. In a Valley full of ranch houses, you wouldn’t think it’d be so tough to find a decent one.