SF is most expensive city for home ownership

[pm]

I don't recall if San Francisco was on this cert ot not, but it's now the most expensive city in the US for buying a house, beating New York. San Jose came in third, beating Honolulu.

www.sfgate.com/cgi-bin/blogs/ontheblock/detail?entry_id=40104

"SF is most expensive city for home ownership in U.S.

The cost of buying a home in San Francisco relative to local wages makes it the most expensive city in the country for home ownership, according to a Center for Housing Policy report.

The report, which looks at wages for roughly 60 occupations compared to home prices and rents in 200 metropolitan areas in the U.S., found that San Francisco, where the 2008 median home price was $575,000, was the most expensive place for home ownership, topping New York (the second runner up), San Jose (the third most expensive) and Santa Cruz and Honolulu (which tied for fourth most expensive)."

[privateatty]

Yes, either you bought early on, you rent a small place, or like the vast majority of civil servants, you live in Bezerkeley, East Bay communities or the Walnut Creek area and take BART.

[pm]

Exactly, but it's just another example of things that have to be considered before accepting some positions.

[carjack]

This raises a question I've had about the cost of living adjustments for cities. Isn't the adjustment supposed to be so that the expensive cities are brought into line with the cheaper places, or is it something else? Why, oh why, is Houston the highest city, higher than all of the high priced housing cities - SF, DC, LA, NYC? After a house or place to live, most other things are relatively even. A person can live quite cheaply in Houston. My only thought was that it had something to do with the average wage for government employees in an area and Houston has lots of NASA people. But DC must have lots of high priced govt people too. Other than that, it smells like a crony fix for Houston, or the person collecting the Houston data really messed up. Getting Houston would be like getting a bonus. I know it has terrible traffic, but so do most cities that sprawl for miles, and I can't think they would try to compensate for commuting. Anybody know?

[ruonthelist]

May 18, 2009 13:44:23 GMT -5 carjack said:

This raises a question I've had about the cost of living adjustments for cities. Isn't the adjustment supposed to be so that the expensive cities are brought into line with the cheaper places, or is it something else?

Carjak: You ask a very good question. Intuitively it makes sense to think that locality pay would be based on cost of living, but it is not. By statute, it is designed to reduce or eliminate disparities between federal and non-federal pay. Of course, to the extent that labor markets are efficient, cost of living and rates of pay will tend to change at similar rates from one region to another, but they don’t track each other precisely, so the highest cost of living cities won’t necessarily have the highest locality pay.

5 USC §5301 provides:

It is the policy of Congress that Federal pay fixing for employees under the General Schedule be based on the principles that—
(1) there be equal pay for substantially equal work within each local pay area;
(2) within each local pay area, pay distinctions be maintained in keeping with work and performance distinctions;
(3) Federal pay rates be comparable with non-Federal pay rates for the same levels of work within the same local pay area; and
(4) any existing pay disparities between Federal and non-Federal employees should be completely eliminated.

5 USC §5304 specifies how local pay disparities are to be “identified and reduced.” Note that the statutory language refers to pay disparities, not cost of living disparities. Section 5304 creates a Federal Salary Council which makes recommendations to the President’s Pay Agent. If you want to see what kind of recommendations the FSC makes, here is a link to their recent reports:

www.opm.gov/oca/fsc/

Note that I am not commenting on how well the FSC does its job. I am not qualified to assess either their data or their methodology. I just wanted to explain the statutory mandate that they are following. Whether they achieve that goal is a different issue.

[Deleted]

I have been told on more than one occasion that the difficulty in getting highly qualified engineers to re-locate to Houston for NASA was the primary reason for the locality pay difference. Apparently, it does not cost that much more to live there, but it costs more to coax your MIT grads down South into Federal employment.

As stated above, difference in cost of living is only one part of the equation. Or, so I'm told.

R

[carjack]

Thanks, that answers a question that has been bugging me since I found out about the pay differentials. I'm still not convinced it's valid or that it couldn't be improved, but, once again, I wasn't consulted.