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The San Francisco Bay Area housing prices are so extreme, even a torched single-family home is selling for $800,000.

The fire-gutted house is located in the affluent Willow Glen community in San Jose. Pictures of the home appear to show a charred roof partially separated from the remaining structure, while exposed paneling and particle boards cover the fixer-upper’s facade.

This home in San Jose is on the market, but it’ll cost you. Despite being charred by a fire, the asking price is $800,000. Courtesy: Holly Barr

The property’s appeal doesn’t lie in the architecture, but in its proximity to the tech industry, the real estate agent representing the property told Newsweek.? It’s about one hour out from Facebook headquarters, and the YouTube and Google campuses are also nearby. Real estate listings accessed on Wednesday, many of which boast about proximity to the bustling tech industry, showed homes in the same neighborhood selling for twice as much.

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To many, however, the Willow Glen house and others like it are emblems of the region’s housing crisis. A web of factors—including incoming tech companies, overeager speculators, landlords and local governments—have sent housing prices skyrocketing. Thousands of low-income, working families from the region were displaced within the last decade. That, in turn, has contributed to a homeless crisis so dire that several cities in Northern California have declared a State of Emergency.

Within two years, San Jose’s homeless population jumped 13 percent, ballooning to more than 4,300 people. In San Francisco, more than 7,499 people reported being homeless, a decrease of .05 percent from 2016.

Michael Rawson, director of the Public Interest Law Project based in the Bay Area, told Newsweek that the Willow Glen house is “symptomatic of the whole problem in the Bay Area.

See all of the best photos of the week in these slideshows

“We need to look at it like we’re looking at climate change,” Rawson said. “We’re at a tipping point. We need to recognize that things are way out of control, or we’re going to lose—or maybe we’ve already lost and will continue to lose—an entire generation of people. “

Residents in the Bay Area have bee grappling with gentrification and displacement for years. Google Maps

He continued, “The way the economy in the Bay Area is right now, it’s like the demand is on steroids. It drives the land prices through the roof.”  

The housing bubble doesn’t show signs of bursting anytime soon, according to industry forecasters. Real-estate firm Zillow reported earlier this month that San Francisco and San Jose are poised to be among the most expensive markets in the country throughout 2018. The median home value in San Jose is $1,1128,300, besting San Francisco’s average $893,000 price tag. To live comfortably in either market, a renter or prospective home buyer would need to be pulling in at least $170,000 per year, HSH.com wrote.

Scores of coalitions and community groups have sprung up in an effort to ease the displacement and gentrification swallowing up swaths of Oakland, Palo Alto and San Francisco. Among the oldest in the state is SPUR, the San Francisco Bay Area Planning and Urban Research Association, which was founded more than a century ago. Sticker shock is long gone for those familiar with Bay Area housing, Teresa Alvarado, the San Jose director for the group, told Newsweek.

“It doesn’t surprise me at all. Affordability has become so out of reach for so many who are trying to survive and make it here,” Alvarado said. “People are now forced to now live in trailers or in tents,cars, RVs, vans. Anything that they can use for shelter.”

There aren’t any quick fixes to help with the state’s homelessness and affordability, Alvarado said.

“We have to identify not only solutions for people who don’t have housing, but also dramatically increase the housing supply,” she said, noting community opposition to building projects. “We also need more involvement in housing issues.”

“Especially,” she stressed, “from the companies that come here.”

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Article source: http://www.newsweek.com/bay-area-sanjose-sanfrancisco-housing-prices-fixer-upper-882115

Silicon Valley may be the world’s tech paradise, but it’s a hiring nightmare for many local startups now forced to venture from Portland to Boise in search of talent.

Enormous salary expectations — driven by the Bay Area’s soaring cost of living and competition from well-paying giants such as Google and Facebook — have made it too expensive for a growing number of local startups to recruit employees here. Others say the workers they do have want to leave, frustrated by their inability to buy a home as the region grapples with a chronic housing shortage.

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Now local startups increasingly are opening satellite operations in cheaper markets — no longer expecting all their employees to congregate in one Silicon Valley office for work, free food and ping-pong. It’s a cultural shift shaking up the startup eco-system that has long been credited with powering Silicon Valley’s iconic tech industry.

“As we’ve been looking to hire, we’re running into the same issue that everyone else is running into — in that the Bay Area is broken,” said Michael Dougherty, co-founder and CEO of San Mateo-based advertising tech startup Jelli.

Jelli, founded in 2009, opened a satellite office last June in Boise, Idaho, where Dougherty says average salaries are about a third lower than the Bay Area. The startup has 10 people in the office so far and plans to add another 30 or 40.

“The community’s cool,” Dougherty said. “There’s a lot of really great folks there.”

As with many startups that operate satellite offices outside Silicon Valley, Jelli’s 30 employees in San Mateo generally make more than their counterparts in Boise. But the money goes farther in Boise.

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School-shooting hoaxes across the country, San Jose’s city travel bills, and Amazon’s guide to perverted photography are the stories featured in today’s The Current.

The median home value in Boise is $236,200 — compared to $1.3 million in San Francisco, $1.1 million in San Jose and $755,600 in Oakland, according to Zillow.

San Francisco-based startup UrbanSitter, which runs an online platform for on-demand babysitters, recently started recruiting engineers in Portland, Oregon. About two years ago, one of their top engineers said he was moving to Portland because he wanted to a buy a home in the Bay Area and couldn’t. Not wanting to lose him, the company let him work remotely from his new home. The next year, two more UrbanSitter engineers announced within a week of one another that they, too, were moving to Portland in search of cheaper real estate.

“We said listen, maybe this is a huge opportunity for us,” UrbanSitter co-founder CEO Lynn Perkins said. “Maybe we should open an office in Portland.”

UrbanSitter now has four engineers in a WeWork space in Portland — about a third of its engineering team. The company invested in Zoom video conferencing technology to bridge the 600-mile gap between the two offices and tries to share the fun events that have come to be synonymous with startup culture. Workers in Portland and San Francisco connect via video chat for lunches, happy hour drinks with online trivia games, and even the occasional in-office yoga session.

Those efforts help, but working in the satellite space isn’t the same as being in the main office, said UrbanSitter lead engineer Travis Dobbs, who moved from the Bay Area to Portland in October.

“I would say there definitely is a small bit of longing,” he said. “You feel like you’re missing out a little bit on things that are happening in San Francisco.”

Dobbs was fed up with renting a tiny, two-bedroom home in Berkeley with his wife, two kids and their dog. The family was so short on space that their son, now 1, slept in a room with Dobbs and his wife, and the dining room also served as the kids’ playroom and an office. Shortly after moving to Portland, the family bought a five-bedroom house for just over $700,000. Now the kids each have their own room and a yard to play in.

Seeking talent outside the Bay Area is a major change, because Silicon Valley remains one of the world’s premier tech talent pools, said Chris Nicholson, co-founder and CEO of open-source artificial intelligence startup Skymind. From the company’s inception more than three years ago, Skymind’s founders decided they weren’t going to limit hiring to the San Francisco headquarters. Now about six of their 37 employees are in the Bay Area. They also have large engineering teams in Japan and the Ukraine and other workers scattered in Canada, Australia, Germany, India, Ohio, Tennessee and Los Angeles.

Nicholson says not paying everyone Silicon Valley wages is saving the company millions annually — a sum that can make or break a fledgling startup.

“It’s a painful decision to make,” he said, “but we did that to increase the likelihood of our survival as a company.”

Remote working is becoming increasingly viable as Silicon Valley shifts its focus from hardware — and the silicon chips that gave the region its name — to software and app development, Nicholson said. Engineers can code from anywhere, and there’s no shipping costs associated with transporting their code around the globe.

“Startups that decide to keep all their employees physically in one office in the Bay Area,” Nicholson said, “by default become vehicles that transfer cash from venture capitalists to Bay Area landlords.”

Toni Schneider, a partner at San Francisco-based venture capital firm True Ventures, said nearly every company his team invests in has some remote workers — it’s become a “best practice” for a Silicon Valley startup. Schneider is the former CEO of Automattic, the company behind the WordPress blogging website, which started 12 years ago with a mostly remote team of employees who worked from home. Over time, Schneider said, Automattic began attracting tech talent who lived in the Bay Area but wanted to leave, and those who wanted to stay in the Bay Area but ditch their nasty commutes.

“We never had a problem finding people,” Schneider said, “whereas every single startup in San Francisco, we ask them what their biggest problem is, and it’s always hiring. And that’s directly related to the cost of living.”

Article source: https://www.mercurynews.com/2018/04/09/the-bay-area-broken-why-local-startups-are-hiring-outside-silicon-valley/