A KPIX headline that's getting splashed around social media since last night proclaims "Even Techies Can't Afford the Bay Area Anymore," but there's a bit more to it than that. As Redfin CEO Glenn Kelman explained to CNBC last week, the home-buying website has seen a a significant uptick in the number of Bay Area people who are searching for homes elsewhere specifically less expensive metro areas where there might be jobs for tech workers like Seattle, Boston, Denver, and Austin.
In 2011, he says, one in seven Bay Area people were doing searches in these other parts of the country, and now it's one in four. And the primary reason is affordability and the income gap while incomes might be slightly or significantly lower in these other cities, the difference in housing price more than makes up for the difference, with the median sale price in Silicon Valley now topping $1 million.
The company where I work, Redfin, understands this impulse better than anyone. We are real estate brokers, with technology used by 10 million-plus people each month looking to move. And the simplest trend we see in American life is that Silicon Valley is no longer just the place talented people move to; it's the place those people are moving from.
Also influencing this movement, he notes on the Redfin blog, is the trend of big tech companies opening satellite offices in these other cities, now that it's no longer necessary for engineers, for instance, all to work in the same office. Among those companies that have opened Seattle offices in the last few years are Google, Facebook, and Dropbox.
This won't probably amount to an "exodus," however, given that industries like to cluster together, and as he points out, the population of Silicon Valley overall as remained pretty constant over the last decade and will like continue to do so while San Francisco's recent population boom, that's another story.
What Kelman expects is perhaps more ominous for these other smaller cities that have prided themselves on being cheaper and scrappier, like Portland. He predicts the "Valley-ification of America, a form of gentrification more extreme than most of America has seen before, with high-tech jobs, high incomes, and more expensive coffee, yoga studios and yes, houses too."