The current state of Bay Area housing bears resemblance to the years leading up to the dotcom bubble in 2000 and the 2008 housing market collapse. At the peak of the housing bubble in 2007, the median sale price for a home in San Francisco was $895,000 while renters were paying just over $2,400 a month on average.
There’s no doubt that the Bay Area real estate market is white-hot once again and it’s largely due to the surging tech industry. Over the last few years, San Francisco has begun looking more and more like Silicon Valley, with companies like Google, Twitter, Airbnb and LinkedIn scooping up office space.
Nine years since the 2007 peak, housing prices, home values and rental rates are once again climbing to unsustainable levels. In 2015, home values jumped by more than 14% and the median sale price, meanwhile, is hovering around $1.1 million.
According to the California Realtors Association’s Housing Affordability Index, just 20% of residents living in the nine Bay Area counties can afford to pay that much for a home. Renters aren’t faring any better, with the median rent for a one-bedroom apartment in San Francisco hitting a whopping $3,490 as of January 2016.