Zuckerburgh Median House Prices Rise $205,000 YoY (Monthly Housing Costs Equal $8,330)

This is a syndicated repost courtesy of Online Course Notes For Financial Markets and Banking. To view original, click here. Reposted with permission.

Mark Zuckerberg, the co-founder of Facebook, has now surpassed Warren Buffet to the third wealthiest person in the world.  Where is Mark Zuckerberg’s home? The San Francisco Bay Area! (Specifically Palo Alto). We will now rename Palo Alto as Zuckerburgh.

There are a large number of tech firms in the San Francisco Bay Area, including Google, Apple and Hewlett Packard. All these tech companies on a peninsula with tight land use controls makes for ultra-expensive housing. In fact, San Francisco median house prices rose by $205,000 YoY so far in 2008 according to Paragon Real Estate Group.

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You know you have an affordable housing problem when the median condo price is around $1.25 million.

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How affordable in the San Francisco Bay Area? Only 15% of households in San Francisco are able to afford a median priced house.

Affordability_HAI-Percentages_by-County

How does $8,330 per month in housing costs suit you in San Francisco? Santa Clara County, the home of numerous tech companies, is slightly less costly at “only” $7,110 per month.

Affordability_Monthly-PITI_by-County-HAI

How do HUD, Fannie Mae and Freddie Mac encourage “affordable” housing in the mega high cost area? The conforming loan limit for Santa Clara County is $679,650, so Fannie and Freddie aren’t buying too many loans from Zuckerburgh! 

According to Redfin, there are not a plethora of sub-$1,000,000 houses for sale in Palo Alto (aka, Zuckerburgh).

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The San Francisco Bay Area is simply unaffordable for most American households.

Mark Zuckerberg could use some of his substantial wealth to lobby for removal of zoning and multifamily construction limitations if he REALLY wanted to help make housing more affordable. But that assumes that Zuck is not a member of the NIMBY (not in my back yard) crowd.

But at the national level, we see median new home sale prices pulling away from median household income.

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Is this a housing bubble or a Michael Bublé?

Wall Street Examiner Disclosure:Lee Adler, The Wall Street Examiner reposts third party content with the permission of the publisher. I am a contractor for Money Map Press, publisher of Money Morning, Sure Money, and other information products. I curate posts here on the basis of whether they represent an interesting and logical point of view, that may or may not agree with my own views. Some of the content includes the original publisher's promotional messages. In some cases I receive promotional consideration on a contingent basis, when paid subscriptions result. The opinions expressed in these reposts are not those of the Wall Street Examiner or Lee Adler, unless authored by me, under my byline. No endorsement of third party content is either expressed or implied by posting the content. Do your own due diligence when considering the offerings of information providers.

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