By: Mya Pham
Throughout the United States one of the most expensive areas to live in is the Silicon Valley. Within the past year the cost of living in the area has increased by 5.7 percent when renting a primary residence. One key factor to the expensive cost of living in the area is the high tech companies, such as, Google, Youtube, and Apple. Because of these companies and the new technology created, the median yearly income in the area is $125,233. With the high paying jobs, this leads to a higher cost of living.
Unlike the majority of the United States, making around $100,000 a year in the Silicon Valley is middle class. There are many factors that lead to the Silicon Valley being expensive, the location, weather, jobs, popular cities, and most of all, the high tech companies. A typical home within a 20 minute commute from these companies’ headquarters costs around $1.2 million. Because of the companies’ popularity this has been a leading factor in the high price of the housing market.
Furthermore, owning a home in the Silicon Valley for most of America is nearly just a dream. Some leading components to the costly living is the area is the high population. Around 3 million people live in the region. With the large population comes a number of people moving in and moving out. In the Silicon Valley this is a sellers market because as long as more people move into the area the more the sellers make. Because of the high tech companies and the cost of living, this has forced the lower class to move out and wealthier to move in and take over.
Overall, living in the Silicon Valley has become one of the most expensive places to live in America. One of the leading components to the costly living is the tech companies. With the higher salary careers in the region this leads to a high expense when it comes to the price of housing. High tech jobs have greatly affected the standard cost of living in the Silicon Valley.
Works Cited
Avalos, George, and George Avalos. “Bay Area Cost of Living Spikes in 2018.” The Mercury News, The Mercury News, 12 May 2018, www.mercurynews.com/2018/05/10/bay-area-cost-of-living-spikes-in-2018/.
Cao, Sissi, and Sissi Cao. “Study: Silicon Valley Housing Prices Baffle Google, Facebook Engineers.” Observer, Observer, 26 Feb. 2018, observer.com/2018/02/google-facebook-engineers-cannot-afford-silicon-valley-houses/.
Hess, Abigail. “The 10 Cities Where Tech Salaries Go the Furthest.” CNBC, CNBC, 29 Sept. 2017, www.cnbc.com/2017/09/29/the-10-cities-where-tech-salaries-go-the-furthest.html.
“Moving to Silicon Valley? 2018 Living Costs & Relocation Tips.” MoverDB.com, moverdb.com/moving-to-silicon-valley/.
I believe that it would be safe to say that only those who actually have one of the high paying jobs in Silicon Valley are able to afford the costs of living there. If this is the case, then it is very interesting to find out just how competitive the housing market is in Silicon Valley, because not every American that wants to live there could come close to affording it. I would also be interested to learn how the high tech jobs in that area impact other aspects of the free market, such as how much more expensive basic items such as food and appliances could cost, seeing as the businesses would be aware of how much money their customer base has. Or, maybe the housing market could be the only factor that has truly been impacted like this, where costs of living have just skyrocketed with the higher paying tech jobs.
ReplyDeleteIt’s really interesting that the cost of living in Silicon Valley has gone up so much in the past few years. Do you think that people that live in Silicon Valley are just there for their line of work or there to purely live there? I feel like a major rationale for people wanting to live there is to potentially receive jobs at these high tech companies and to try and gain more financial stability, thus giving the people living there more income but also fueling the insanely high costs of living and also allowing these companies to continue to grow more and dominate their technological field.
ReplyDeleteBefore reading this I never heard of Silicon Valley. Now that I know about it I 100% agree with this article that high tech jobs affect the standard cost of living. This is a prime example on the fact that there is big companies like Google and Apple and since those companies have been there the average income in Silicon Valley has skyrocketed. The average income in that city is over 100,000 dollars. To conclude all I have to say is the more big businesses you live by the more it cost to lice there.
ReplyDeleteI agree with you,the emergence of tech companies from the likes of Google,Youtube, and Apple in the Silicon valley has increase property price and value. Making it only accessible for the wealthy to afford staying in this region. This also explains how property value depends on what companies, resources, individuals, and landmarks are near it. For an example, you could compare this to west Hollywood, both location are famous in their own forms of media/production. On one hand, Hollywood is known for having a plethora of celebrities and famous film companies residing in it. Which make up for the average price of a estate around 814,000 dollars. While on the other hand, Silicon valley having the location of big corporate technological titans; has increased the market value which in terms impacts the consumers and individuals in those areas. Which indeed result in property prices to go up only allowing wealth individuals being able to afford residing in those locations due to the surrounding factors.
ReplyDeleteI think that you make a great point about how these big high tech corporations are causing all of the surrounding area’s economy to boost with the example of just the increased pricing of homes in the area, but in reality, with homes that are increasing in price, you are also going to be seeing an increase in prices for other things around the area. For example any businesses near there are going to have to pay more for their land since it is worth more, and with them having to pay more, they are also going to want to make more money to keep their profit margins or even just their businesses. So basically all these companies are doing are just causing so much development in the surrounding areas that it is making it a lot harder for the other people that are already living in the area to keep what they have, and to purchase items, with them then having to go to such distances that it would be more worth it to just move to a less wealthy area where everything is much more affordable without going to such far distances to get them.
ReplyDeleteYes, it is very expensive to live in Silicon Valley none to less California itself, but I don’t believe there is anything wrong with the expensive living in that area. With the high tech companies, that are some of the largest companies in the world, comes higher salaries. Now I would expect for living in an area with such a nice climate is a dream to most itself but with that dream comes an inspiration to work harder and try to make more money so that dream becomes reality. Sure the lower class living in the region may suffer from the living expenses but that is just the standard, like if someone were to move into a less populated region that isn’t as nice climate wise then obviously expenses in the area such as living will most likely decrease in comparison to places like Silicon Valley. WIth this being said normally the wealthier like to live in better areas and the less fortunate move into more affordable homes and nothing is wrong with this.
ReplyDeleteIt is very expansive to live in Silicon Valley but over call California is a very expansive place to live. But with how much it cost to live there equals the amount you get payed. When working for some of the biggest company comes a higher salaire. With this in mind to live there with the nice weather its going to be expansive to live there because so many people have a dream to live there. But this shows what people can do for themselves. The harder you work it's going to pay off and you are going to be able to live in suck nice area. But with this is going to be expansive to find a place to live and everything else.
ReplyDeleteBefore reading this article I had knowledge about the Silicon Valley to some extent. I knew that technology start up companies often move to there to open the door for the opportunities and to be near partners in business. This article did teach me though how the cost of living is changed by those huge corporations moving and increasing the populations and standard of living.
ReplyDeleteWith Silicon Valley being a compilation of high-tech billion dollar companies, it's no surprise the cost of living in this area is so high. Not to mention it is located in California, the state with the highest population. In an area with many people, and high paying jobs it's no surprise the economy has adapted with high paying jobs and costly houses. My question is what is the unemployment rate in this area, and how many people live below the poverty line. I would assume there is a large amount of income inequality in this area with many large companies and just as many wealthy CEO's. I also wonder how the people who have always lived near San Francisco have adapted to the expensive companies near by.
ReplyDeleteIt’s really interesting that more higher paying jobs aren’t actually good for the area surrounding them. People can no longer afford to live in a home close to their job because it drives up the cost of living there.
ReplyDeleteYeah, everything is more expensive, but everything is also better in California; the quality of what you're getting is higher. I have a friend that lives in the North Bay area and all the food is better because it's by Napa Valley, and all the buildings are nice and new.
ReplyDeleteThe reason that the cost of living and everything is expensive is because of the job quality in California. If you happen to get a really high paying job in a tech-savvy place of the state, you can probably imagine the standard and cost of living. The job that you hold is most likely proportional to the living standard that you can have. If you are only getting $50,000 per year, then your cost of living is most likely lower. If you work in the Silicon Valley, and your starting income is around $90,000 to $100,000, then you see directly how the cost of living will be.
ReplyDeleteCalifornia itself is an expensive area to reside in, nonetheless, Silicon Valley with the technological businesses that are driving today's economy. Some may enjoy the closeness of the dominant companies as they can offer ample opportunities for job seekers. However most do not as their presence shifts the housing market from reasonable to intractable. Places like Google can be good company in lowering the unemployment rate; yet, also raise the standard of living so much that their own employees are suffering. With development like this also comes another less significant problem bestowed upon the area, such as the traffic. Big companies like those in Silicon Valley have the opportunity to contribute to the solution because they have a big platform and are very wealthy. It just depends on whether or not they can decide to be conscious of the moral boundaries that they have crossed.
ReplyDeleteCalifornia is an expensive place to live in in general, but with all the high tech jobs, it increases the living cost for everyone. If the job opportunities are increased in a certain residential area, the cost of living tends to go up with the knowledge of how much everyone is making. With the high tech jobs tending to pay more, the general cost of living would make sense to go up. And with all the high tech jobs being mainly concentrated in silicon valley, the workers would make a good amount of money. With that amount of money, they would tend to choose to live in a house that they can afford and is a good size. California in general is an expensive state.
ReplyDeleteLike Ryan, I have never heard of Silicon Valley until reading this. What I found most interesting was the fact that Silicon Valley is a sellers market because as long as more people move into the area the more the sellers make. Which makes sense because the people working at these high tech companies are pretty wealthy that they need to live close to their jobs, making Silicon Valley the hot spot for them as they kick lower class/income families and move in.
ReplyDeleteIn general, the cost of living goes up in areas of higher income jobs. California alone has a higher minimum wage and better paying jobs compared to other states like Wisconsin. Adding the high tech companies into the mix only drives the cost of lving up espeically becasue some of these companies are competitors. With these companies, they are able to supply many jobs to people in the area. When the demand of labor rises, their wages goes up as well. Although this may seem good for the people in this area along with surrounding business that feed off of the higher salaries, it increases the poverty rate. Those peeople who are lving paycheck to paycheck cannot afford to live in such an expensive area forcing them to live elsewhere.
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ReplyDeleteThe high-tech jobs, though they make the cost of living higher, benefit the society through their exclusivity due to the high prices. With self-interest in mind, the motivation for having a residence may just be the hallmark aspect of it. But that is an positive external impact on the economy as well as it inspires people to increase their innovation and goals to live in a location with high cost of living and property value. As established in class, every company is fueled by profit and gains. The increase of a sense of entitlement for staying in a place such as silicone valley induces the rise of innovation and may cause extra competition, which in turn benefits the consumers as they get better products (technology in the case of Silicone Valley). So the want for being the new Google or Amazon causes for one location's prices to be absurd, but the cost of that area has the result of better products for the general population. In the long run, these high tech jobs should be excused for inadvertently raising the cost of living as the economy benefits through the high competition.
ReplyDeleteCalifornia is an expensive place to live in,due of their high demanding software companies. Since a lot of companies are located in this certain city most people tend to move there. Because working in an expensive urban city would definitely increase salary, which tempts a lot of people to move to California. What makes California rich, the increasing population and it's companies. Establishment of new companies makes a lot of people want to join and work their because of money. The apartment owners or real estate businesses people make profit out of this by selling $900 apartment at a rate of $1800 due to the popularity of that city and they know that everyone could afford the apartment because their salaries are high. But it might benefit other businessman, as the population and the rate increases a lot of people tend to make money out of it buy selling same apartment for $50 less.
ReplyDeleteThis is super interesting! I've never really thought about how the high paying jobs have an impact on the cost of living in California -- I always just thought it was so high because of the location and weather. My brother worked for Facebook in San Francisco for two years and experienced this effect in a massive way. His cost of living sky rocketed and his salary partially compensated, but he was only making nominally more than he was during his time in university.
ReplyDeleteAfter reading about Silicon Valley, I am not surprised it is so expensive to live there. California has always been a very expensive state to live in due to the beautiful weather and the amount of celebrities that live there as well. What I was surprised about, however, was the fact that living near one of those big tech companies is one of the main factors the cost of living in that area is so high. I am also surprised that it is the most expensive place to live. I would have expected it to be L.A. or another big city in California.
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