Band of Brothers: New York & San Jose – United In Their Unaffordability

By Jeff Vasishta August 25, 2016
Photo courtesy of

Legendary songwriter Burt Bacharach wrote the hit, “Do You Know The Way To San Jose” for Dionne Warwick in the 1960’s. Had he written the song today he may have changed the title to “Do You Know The Way To Buy A House In San Jose?” The Northern Californian city is the first US metropolis where the median price of a home is now over $1 million. People don’t buy starter homes in San Jose, they buy them once they’ve got started.

Related: A Rent Freeze May Offer Temporary Relief For New Yorkers

According to the National Association of Realtors, home prices rose 83% across the U.S. in the second quarter of 2016 making the median home in San Jose $1085,000—$199,400 higher than the average price in San Francisco, a city that is well known for high-priced homes.

Fueling San Jose’s price hike is nearby Silicon Valley, where average incomes, five years into a career, usually top $100,000 per annum and billionaire tech execs keep the real estate market inflated. It all makes for a tall order for a mid-career employee to buy a home.

“Most buyers get onto the property ladder by starting at the bottom, although some first time buyers with a lot of cash from Google, Apple, LinkedIn can start much higher,” says Skip Levy, a realtor with the Sereno Group who has been involved with San Jose real estate for thirty years. “We recently helped some 30-year-old buyers purchase a $2.1 mil, fixer upper home in Mountain View. They both work for Google and make good money. They also were able to sell stock for their down payment of $900,000.”

Comparatively, Manhattan’s median income is around $148,000 according to the Bureau of Labor Statistics. Like Silicon Valley, buying a home in New York is about a challenging as negotiating a rent reduction for penthouse with a river view. The median cost of a Manhattan apartment is $1.95 million according to real estate firm Douglas Elliman. This may be why most Manhattan workers do not live in the city, but commute from outlying areas where the cost of living is less. But, like mold in a Jersey Shore basement after Hurricane Sandy, soaring sales and rents on both coasts have crept into the suburbs too.

Related:  How Do The Richest People In The US Buy Their Houses? It Might Not Be As You Expect.

According a a recent NY Times article, activists across Silicon Valley and the San Francisco Bay Area are pushing for a slew of rent control proposals. In New York, amid sweeping gentrification, affordable housing has become an oxymoron. The idea is being pushed to have a percentage of large developments in East New York, Bushwick, Harlem be set aside for affordable housing. However, many activists see the correlation as a scam.

“I don’t fully understand or appreciate the focus on new construction,” said Inwood resident Jennifer Fox to Gothamist. “What I see as the threat in Inwood specifically is the market pressures…the systemic abuses that we see in frivolous abuses, in landlords who charge preferential rents, and then, whoopsy daisy, four years after you can’t challenge your rent, now you’re up to what they claim is legal rent. I am frustrated with the fact that all of these re-zoning proposals are only talking about the new construction and not talking about the preservation.”

In New York and San Jose, it seems a legacy of increasing rents may be the only thing being preserved.

Jeff Vasishta



Jeff is a writer, husband and father but not necessarily in that order. As a music journalist he counts Prince, Beyonce and Quincy Jones amongst those he’s interviewed. He's also owned and flipped homes in Brooklyn, NJ, CT and PA.

    Avocado toasts are the reason why millennials can’t afford a home, says one Australian real estate developer. #AvocadoToast #Millennials
    Five years on since Superstorm Sandy, Queens’ coastal peninsula is in the midst of a development boom. #Development #Rockaways
    It turns out, renters can’t get enough of good ol’ no-doorman-no-frills apartments. Too bad developers aren’t building any. #Doorman #LuxuryRentals
The Housing Market In Shenzhen, The Silicon Valley of China, Slows In 2017
The city of Shenzhen has been on the real estate radar for quite some time. It is known as the Silicon Valley of China. Many…
Developers Jump Aboard The Trend To Revamp Transit Hubs And Remake Cities
Never has the often used marketing term, “close to transportation” been more important when attracting home buyers. These days it’s not just homes that are…
Millennials Are Fueling The Current Sizzling Real Estate Market
Ever wondered why the hosts of home improvement shows seem to be getting progressively younger, along with the fresh-faced couples getting their new properties made…
The Best Cities For Recent Grads To Rent – Without Blowing Their Entire Paycheck
What’s next post graduation? For most, the logical answer is to find a job. After the excitement of finishing your studies and the big celebration,…
Luxury Knows No Limit In Malaysia As A Deluge Of New Developments Hit The Market
The amount of newly constructed high-end real estate in Malaysia is almost as abundant as the lush vegetation which covers the tropical landscape. Despite vacant…
Don’t Call It A Commune – Upscale Co-Living Is Attracting Major Development
What may have once been referred to as a commune is today termed a co-living space. The big news that it’s not hippies with hemp…
It’s Official—New York Is Now The Most Expensive City In The World To Build
As if you didn’t already know, it’s expensive to build in New York City. Not just expensive but now officially the most expensive place in…
An Ultimate Destination For The Most Comprehensive Real Estate Data, Agorafy Prepares To Launch Nationwide
In the coming days, Agorafy will be entering a new chapter. It is the beginning of a new growth cycle in real estate technology with…

TOP 10