The cheapest international city in the world is San Francisco. I have visited over 60 countries and over 150 cities and it is clear San Francisco provides the best lifestyle and wealth-building opportunities.
Although you might see headlines that San Francisco is one of the most expensive international cities in the world, you've got to dig deeper. With 23-year-old college graduates making $150,000+ a year, the income opportunities make San Francisco affordable.
So many of my friends who live in New York City or around the country like to say that the median rent and home price in San Francisco are our country's highest. It's simply not true.
If I had to pay $2,500 a square foot for a condo in Greenwich Village, I'd be a little bitter too about equally amazing SF property costing 40% less. Heck, you can even get panoramic ocean view properties in San Francisco for under $1,000 a square foot. There's no other city in the world that can boast such value. Other international cities have ocean view properties at $1,500+/sqft.
This article will argue why I believe San Francisco continues to be the cheapest international city in the world, despite all the tremendous income opportunities. Now with artificial intelligence boosting real estate, San Francisco is even cheaper compared to income upside.
Long-Time Resident Of San Francisco
The media have a great way of misleading the public because they like to take averages and extrapolate. I am in the trenches, actually visiting open houses in NYC and SF and bidding on places. Cities are priced a certain way due to income and wealth-building opportunities.
I'm also a landlord who is very in-tune with market rents and wages for the 22-35 year old crowd. Based on the rents and incomes I've seen, San Francisco is affordable if you can land one of the many tech, internet, software, healthcare, consulting, and finance jobs.
I was just in London for Wimbledon, and places in Knightsbridge and Chelsea make Pacific Heights in San Francisco feel like Costco prices!
I think buying San Francisco real estate in 2025 is a good move. With the strong performance of the NASDAQ, declining rates, pent-up demand, new city government leadership, and the artificial intelligence boom, buyers of San Francisco will likely be very happy 10 years from now.
The Cheapest International City In The World
Let's say you are a skeptic and still think San Francisco is not the cheapest international city in the wold. That's fine. Don't listen to me and my 40+ years of experience living everywhere and working internationally.
Take a look at this fantastic cost-of-living index from The Economist, which pegs New York at 7.
As you can see from the chart, San Francisco is nowhere to be found! The reason why is because San Francisco is one of the cheapest international cities in the world. It is also one of the best cities in the world to buy real estate. Well actually, I did find San Francisco rank at a lowly #34 after looking hard enough.
Here's another Cost Of Living Index from The Economist. Once again, notice how San Francisco is not even on the map. Yet, San Francisco and the Bay Area have major companies that pay very well. We're talking Google, Apple, Facebook, Twitter, Clorox, and more.
For those of you wondering what is the definition of an “international city,” let's put it out there.
An international city is a city where there are large amounts of foreign office hubs, foreign visitors, wealthier immigrants, and foreign property owners. An international city faces a foreign demand curve of buyers.
The pandemic has throttled foreign buyers of U.S. real estate since 2020. But expect foreign buyers to gobble up U.S. real estate once borders reopen again. The wave is happening in 2023.
An easy way to think about an international city is to ask yourself whether you'd consider vacationing there. New Delhi? Absolutely. Karachi or Fargo, North Dakota? Not so much. San Francisco, Los Angeles, Seattle, Boston, Washington DC, and New York City are international cities of America.
Exploring Honolulu, Hawaii
To prove that San Francisco is one of the cheapest cities in the world, let's go explore other cities.
In early 2014, I was thinking of renting out my house, increasing passive income, and moving back to Honolulu to be close to my parents. I went searching every weekend for five weeks for property, and here's an example of what I found. This isn't even the most expensive of the bunch.
This house is at 4657 Aukai Avenue in Kahala, Oahu. It's a great neighborhood close to the Waialae Country Club where I could play golf in the morning, get some lunch in the afternoon, take a nap on the beach, and then play tennis after 4pm when the sun isn't too hot. Not a bad life right?
With 4 bedrooms, 4 bathrooms, 3,430 square feet of living area, a pool, and 0.25 acres of land, the house would be just perfect for a family of four and the occasional guest. It's certainly not one of those mega-mansions by any means.
What About The Price?
Here's the problem. The asking price is $3,475,000! I mean, seriously? How the heck is the normal person supposed to afford this home? There are simply not enough jobs in Honolulu for locals to pay so much.
I worked in finance for 13 years, saved 50-75% of my after tax income, and have the largest blog in my zip code that starts with the letter “f,” and there's no way I could afford this home. I'd have to come up with a $2,475,000 downpayment to get to my ideal mortgage amount.
Even if I could come up with a $2.475 million downpayment, earning $150,000 a year in passive income just barely comfortably covers the $4,000 a month PMI mortgage payment if I were to have kids. You might be wondering why I wouldn't just get a job then?
Here's the thing. In 2024, this house hasn't changed in valuation! Not only was the house expensive to buy, it also didn't provide a proper return. In contrast, San Francisco home prices continued to go up. If you were long SF property, San Francisco now has become even cheaper to live in.
I had to look on.
Related: Retiring In Hawaii: The Pros And Cons
Exploring New York City, NY
Despite New York City being grey, cold, or muggy for half the year, NYC is still the best city in America for the other half of the year. The food, the entertainment, the people, and the buzz are incredible!
My biggest regret was not buying a $730,000, two bedroom, two bathroom, double balcony condo at 24th and Madison with a view of the Chrysler building in 2000. The 1,300 square foot condo is probably worth much more today. But how much more, I'm afraid to know.
Undeterred and always hopeful, I went looking online and offline for my retirement condo in NYC and here's what I found.
Expensive Condo
A 569 square feet West Village condo at 366 W 11th St #10A with a deck for $1,445,000. I like the indoor/outdoor living, but come on. $2,539 a square foot is outrageous for what it is.
I'm a middle-aged man who doesn't want to go back in time and live like a college student. 569 square feet is tiny, especially if there will be two or more people inhabiting the space. Let's keep looking.
Expensive Brownstone
I was thinking to myself, why not try and find a home in Manhattan that is similar in size and in location to my home in San Francisco. A fair trade in property, despite the inferior weather of NYC sounds like a decent goal.
I couldn't find a 2,400 square foot brownstone in Manhattan. All of them were at least 3,500 square feet with four stories. Fine, I'm happy to entertain bigger properties if the value is there.
Here's a 3,500 single family home at 112 Washington Pl in the West Village. One big problem. It just sold for $11,000,000 million! The brownstone is gorgeous, but come on Gina. That's $3,141/sqft and where am I supposed to park my lady-killer Honda Fit? On the street? Ridiculous. Look how skinny the lot is.
New York City, Manhattan specifically, truly highlights how San Francisco is one of the cheapest international cities in the world. Although, there are cheaper Burroughs such as Queens wear, the median household income is lower to afford a typical home.
Luxury Condo With View
OK, now I'm thoroughly depressed. There's no way I can afford $11 million fo a brownstone. New York City is definitely not the cheapest international city in the world. Although, prices have been coming down post pandemic.
Forget a single family home in Manhattan. Let's go back to looking for a condo in a great location. I've always wanted to live near Central Park. Having the combo of a big city plus nature would be incredible.
I found this great 2,021 square foot, two bedroom, two and a half bathroom condo at 15 Central Park West #2E. The size is perfect and it has a nice terrace, but I was hoping to have a third bedroom in case I have guests or kids. Oh well, I'm willing to compromise if I can save a little bit of money. Unfortunately, the asking price is $8,990,000 or a whopping $4,448 a square foot!
Thoroughly depressed, and still amazed by how often people say that San Francisco is the most expensive city in America, I decided to give up my plans of moving to Honolulu or New York City. New York City makes San Francisco look so cheap.
PS: New York has six ZIP codes among the Forbes' top 10 most expensive zip codes list. Long Island’s Sagaponack 11962, in the town of Southampton, grabs the No. 2 slot after Atherton, CA at #1. Number 3-5 are New York City ZIPS: Lower Manhattan’s 10013 (No. 3), the Upper East Side’s 10065 (No. 4) and 10075 (No. 5).
How About Paris, France?
Maybe Paris is the cheapest international city in the world. I spent a week in Paris in May 2016 and San Francisco is definitely dirt cheap in comparison. Notice how Paris ranks #5 in The Economist's list of most expensive cities above.
I stayed at a Junior Executive Suite Deluxe at the La Reserve Hotel for a week and it costs 1,700 Euros a night. That's about $2,000 a night.
The hotel room is nice at ~500 sqft, but $2,000 a night seems a tad much doesn't it? In San Francisco, you can stay in a similar size suite for about $500 – $700 / night. Not cheap, but 70% cheaper than Paris!
Food is super expensive as well. It didn't matter where I went, each meal cost $80 for two at a minimum for dinner. Below is a light dinner we had off the Champs Elysees for about $74. The French Onion soup cost about $28, the Caesar Sald $31, and the beer about $15.
Why Is San Francisco The Cheapest International City?
Maybe people are afraid of large earthquakes, which happen once every 25+ years. I would rather chance having a large earthquake than having hurricanes or tornadoes every single year. Or maybe people believe SF is so expensive because the media has successfully scared away people at the margin.
For 13 years, I had no idea there were homes with ocean views in San Francisco for so cheap until I decided to actually go look. San Francisco residents are more financially satisfied. They don't require as big of a net worth to feel wealthy. And this is partly due to a beautiful environment, nice homes, more diversity, and more opportunities.
You would think that with amazing weather, world class universities in Berkeley and Stanford, huge companies like Apple, Google, eBay, Genentech, Facebook, Twitter, Uber, Lyft, AirBnB, Uber, Clorox, Chevron, SalesForce, Yelp, Yahoo, Levi's, plenty of VC and PE funds, and nation-leading low unemployment, San Francisco would be way more expensive than Honolulu and New York City.
But San Francisco is so much cheaper in comparison. You can buy a panoramic ocean view, 2,000 square foot, single family home for $2 million ($1,000 / sqft). Yet, you can still earn the same income, if not much more than if you lived in Honolulu or New York City.
Some might have thought me crazy for buying a fourth property in Golden Gate Heights. But I found it insane that prices weren't even $800 a square foot for properties with panoramic views back in 2014!
Job Opportunities Are Huge In San Francisco
Then there was this 26 year old guy who went to programming bootcamp and told the world he received a $250,000 a year total compensation package at Airbnb! Just look on LinkedIn or Angel.com for jobs and you'll see plenty of $100,000 – $200,000 a year opportunities.
Six figure jobs are a dime-a-dozen here in San Francisco. One ad agency rep with only one year of experience moved to Netflix for $140,000. Not bad for a 24 year old right? Every single one of my 23 year old tenants makes over $150,000 a year given they work in finance and tech. My MBA grad tenant makes over $280,000 a year, if not much more based on her carry.
Even if there was a great house with views in Honolulu for $1.5 million, I wouldn't feel as comfortable spending the same amount of money there as I would in San Francisco because the job markets are so different. In Honolulu, I was thinking about working at Cold Stone Creamery for $10 an hour. At least I could hook my friends and family up with some free ice cream.
I could probably find a six-figure job in New York City in finance or internet/tech. But the problem is that New York City is so much more expensive than San Francisco that I would need at least a 50% pay bump to afford something similar.
Now there is a massive artificial intelligence boom, where San Francisco is ground central for all the largest AI companies like OpenAI, Anthropic, and Databricks. If you can't get a job in AI, then you should buy real estate in cities that are home to the largest and fastest-growing AI companies.
Buy San Francisco Real Estate
It's pretty evident that San Francisco is undervalued in terms of rent and property prices compared to other major cities in America and around the world. All you have to do is spend hours pounding the pavement and searching online to realize the truth.
The first picture in this post is a $8.9 million, 9,500 sqft mansion in Presidio Heights, San Francisco. This would be well over $25 million in New York City if such a place could exist.
When you can earn the highest incomes in the nation and not even be included as one of the 100 most expensive places to live according to The Economist, you know you've discovered an absolute steal.
The key is to buy your slice of heaven before everybody locally and internationally find out. I fear what will happen when China's capital account gets liberalized.
I'm buying all the panoramic ocean view single family homes possible in Golden Gate Heights, the best area to buy property in San Francisco. There is a demographic shift towards living and working on the west side of San Francisco. As a result, I would buy as many single-family homes there as possible.
It is clear thanks to high incomes, San Francisco is the cheapest international city in the world.
Invest In Real Estate More Surgically
If you can't afford San Francisco real estate, then buy U.S. real estate. U.S. real estate is one of the cheapest developed country real estate. Foreigners know how cheap U.S. real estate is, which is why they are buying our properties.
If U.S. real estate prices ever got as hot as Canadian real estate prices, U.S. real estate prices would be up 70% more today! Yet, the United States has way more opportunities to build great wealth.
If you don't have the downpayment to buy a property, don't want to deal with the hassle of managing real estate, or don't want to tie up your liquidity in physical real estate, take a look at Fundrise, one of the largest real estate crowdsourcing companies today.
Fundrise has an investment minimum of only $10 and predominantly invests in Sunbelt residential and industrial real estate, where valuations are lower and yields are higher.
Real estate is a key component of a diversified portfolio. Real estate crowdsourcing allows you to be more flexible in your real estate investments by investing beyond just where you live for the best returns possible. For example, cap rates are around 3% in San Francisco and New York City, but over 8% in the Midwest if you're looking for strictly investing income returns.
Sign up and take a look at all the residential and commercial investment opportunities around the country Fundrise has to offer. It's free to look.
Private Real Estate For Accredited Investors
For those of you who like to invest in individual real estate deals, check out CrowdStreet. CrowdStreet focuses on real estate investments in 18-hour cities, those cities with potentially faster growth and better valuations.
With technology and the growth of work from home, I believe there will be continued migration to 18-hour cities. CrowdStreet is also free to sign up and explore. That said, you must do extra due diligence on every sponsor and build your own select real estate portfolio.
I've personally invested $954,000 in private real estate since 2016 to diversify and earn more passive income. The older I get, the more I love earn 100% passive income. Sunbelt real estate is a multi-decade trade we should benefit from!
Both platforms are sponsors of Financial Samurai and Financial Samurai has invested over $270,000 in Fundrise.
Invest In Private Growth Companies
In addition, consider investing in private growth companies through a fund. Companies are staying private for longer, as a result, more gains are accruing to private company investors. Finding the next Google or Apple before going public can be a life-changing investment.
One of the most interesting funds I'm allocating new capital toward is Fundrise venture capital product. It invests in:
- Artificial Intelligence & Machine Learning
- Modern Data Infrastructure
- Development Operations (DevOps)
- Financial Technology (FinTech)
- Real Estate & Property Technology (PropTech)
Roughly 65% of the Fundrise venture product is invested in artificial intelligence, which I'm extremely bullish about. In 20 years, I don't want my kids wondering why I didn't invest in AI or work in AI!
The investment minimum is also only $10. Most venture capital funds have a $250,000+ minimum. In addition, you can see what Fundrise is holding before deciding to invest and how much. Traditional venture capital funds require capital commitment first and then hope the general partners will find great investments.
The Cheapest International City In The World is a Financial Samurai original post. As the real estate markets softens due to aggressive rate hikes, I'd look to buy San Francisco real estate at a discount. Long term, you and your children will thank you!
Funny you say you wouldn’t consider visiting or vacationing in Chicago, as it’s consistently a top US destination. 30+ million visitors per year.
I’ll have to change that then. Chicago is great during the summers. Great steak and sports!
Changed to Fargo, North Dakota during winter!
This article doesn’t really account for industry differences in pay by city or state. A lot of people like to say that you make more money in a big city like San Francisco.. Depending on industry this may not be the case from a housing cost to income ratio. For example I am a Physical Therapist in Las Vegas, NV with total earnings of about 110-115K. Decent homes in good part of the valley are 300 – 350k. Lets compare to SF. Could maybe up earnings to about 120-130 but Las Vegas is one of the higher paying cities for Physical therapists because of demand. As you can see it doesn’t make sense in this example to barely earn more than I do in Las Vegas to move to a place where a shack is 900k…. Also people tend to compare things they can relate to. It’s all relative. Nobody really cares what things cost in other countries. The only thing we have control of as American citizens are what the costs are here.. This country also has a huge student debt issue that those other countries don’t have. Overall, If you are part of an industry where you can make > 200k a year in San Francisco then sure it would be a nice place to live. If you’re not then I don’t think it’s a move that makes much sense.
I’m totally blown away that AirBnb engineers can have an annual salary of close to $300k! Most engineers I’ve known are in the $100k to $170k region with only ultra rockstars getting close to $200k. Then those that want to earn more jump into management, their own startup or the dark side – enterprise sales – to clear the $300k mark and above. Would love to know where you found these numbers?
I agree with the premise of your article that SF is cheap. Coming from London I sold my teeny tiny (ex council) flat for $800k in 2016. I couldnt believe that I could get a cool 3 floor loft apartment+parking in the Mission for $1m.
Personally I am jumping in ASAP as when the next liquidity event happens all bets will be off for everyone else. The other good thing about SF is that even if we had a 10% decline/crash there is so much liquidity sloshing around that others would jump in and pickup the slack.
I just wish the local women would take a page from LA women, alas we need dreams.
Not bad right?
It’s actually total compensation, including stock grants. Check out: Why The Rich Should Pay More Rent: An Airbnb Employee Explains to find the source of the salary.
Okay a ton of RSUs. All of those businesses are sound so an engineer would just have to wait it out and put his faith that management will help them get rich ;-)
But many of them dont have a $20k+ salary available today, its closer to $10k pretax and the RSUs *could* happen in the future.
I have friends waiting for their own liquidity event at Mulesoft where they’ve been told an IPO is coming for the past 4 years – apparently this year is the year – but there are inevitably people who drop out of the rat race no longer driven to grind out 12 hour days.
I really don’t think you live in the real world. Most people cannot afford these multimillion dollar properties you rattle on so casually about. The average income is only around $84K – before taxes. Most people I know struggle to afford even just to rent and have to live with multiple roommates or are pushed out to the East Bay. Most people I know in tech don’t make 6 figures. Actually, closer to $70K.
I don’t get the sense you’re deliberately being dishonest, just that you’re more shrouded in perceptions that come from being in a certain socioeconomic group.
What are your thoughts on why your real world is more real than my real world? I grew up in six different countries from ages 0 – 13 before coming to the US. I speak three languages, which helps understand the Chinese, American, and Hispanic customs. I’ve visited over 50 countries, most recently Cambodia, Thailand, S. Korea, Taiwan, and Vietnam last year, and Czech Republic, Austria, Hungary, and France this year. I’ve clearly seen how much more it costs to live in Vancouver, Paris, Hong Kong, London, Singapore, NYC (where I lived for 2 years) compared to SF.
I worked $4/hour minimum wage jobs growing up, went to public schools all my life, and still drive for ~$20/hour (just gave several rides yesterday).
As an investor, you’ve got to think ahead and think about the demand curve. Otherwise, how else are you going to make better returns? I personally feel SF is very undervalued as an international city with a huge amount of six figure jobs and a growing tech/internet industry.
Why do you discredit my views? Why do you think your reality is more real? I’d love to know more about you.
Thanks
The real world is full of people who do not travel. While I understand your argument, that you have a cosmopolitan upbringing which gives you a worldly perspective, when CeeCee said he/she doesn’t think you grew up in the real world what he means is that living in 6 different countries before the age of 14 and having visited 50 countries in your life makes you part of the elite. Most poor and regular people, like me, think that a lot of rich people live in a bubble because they think their lifestyles are normal when in reality they are the 1% (or some tiny fraction of humans live like you). you have probably spent hundreds of thousands of dollars on airplane tickets alone, and this is not normal in our world. While I concede that you appear to have written this article for a super wealthy audience, the world of the super wealthy is not the real world, it is a perspective reserved for a privileged few who often cannot see the struggles of those living around them (who they frequently are exploiting).
Now because you always ask people who comment about their personal lives, about me: I was born in Italy and grew up in Marin County, California, across the Golden Gate from SF so, if I know about one thing, its about people living in a bubble (including myself and you).
I have totally bought into the media stories about how San Francisco is so expensive but I am looking on Zillow right now and see that you are right. A beautiful 1500 square foot home with ocean views is listed for just over 1 million. You can get a two unit building further from the coast for 1.25 million. I would rent out one unit for at least 1500 a month and live in the other. Considering the incomes in the area, the climate, and the amenities of the city I do agree it is a pretty good value.
And not only that, $100,000 plus a year jobs are a dime a dozen.
You can get part-time consulting gigs working 25 hours a week over $100,000. I know because I’ve done it and they just keep on coming. There’s so much demand for labor out here it is crazy. The media doesn’t focus on how much people can make in the wealth here.
1) SF is heavily rent controlled. Your cash flow will suck if you are not living there yourself.
2) Tech salaries are cyclical. Many SF companies make no profits. Airbnb, uber, twitter, salesforce, facebook even make little to no profit compared to their market value. The market value they have at the moment is all based on future projections and not based on any tangible present earnings.
[…] At $1,800 a month, the rent was cheap compared to the $2,100 a month studio + alcove apartment I rented with a colleague in Manhattan earlier. $300 less a month and 25% more space. What a steal in the world’s cheapest international city. […]
[…] all day long if you never take action on your beliefs. I currently believe San Francisco is still one of the world’s cheapest international cities. There’s no other coastal big city that I know of where you can buy panoramic ocean view […]
[…] per square foot in places like Hong Kong, London, and Manhattan. San Francisco is turning into a major international city before our eyes with all the cranes downtown due to the profitability of tech firms e.g. Facebook […]
[…] where price per square foot are in the $2,000 – $3,000+ range. San Francisco is one of the cheapest international city in the […]
This is not a rational statement:
“Surely, The Economist wouldn’t just inadvertently leave off the greatest, and “most expensive” city in America, would they? Of course not, although where the hell is Hong Kong?”
How do you know? And what was the source of their data?
Youre comparing apples to oranges. The logical comparison is AVERAGE INCOME TO AVERAGE COST OF LIVING.
SF does not trump other places with that one. There are plenty of poor people in SF.
I found this post beyond amusing. San Francisco is a very expensive city to live in by just about any measure. The whole idea of an “international city” is pretty dumb. And New York is an acceptable comparison but Chicago is not because of the weather?? Come on! Chicago and NYC have similar weather.
I don’t think one can see Chicago now given the Omega Storm. An International City is all about attracting the FOREIGN DEMAND CURVE.
Do you think foreigners from Nov – April are thinking, I must get me some Chicago property? No. Think how others think.
Maybe this should be titled “The Most Economical International City in the World – San Francisco” because you take into account income earning potential, and it carries such a big weight.
My friend brought up that, for example Berlin and Tallinn are much cheaper, international cities than San Fran. Unless these cities didn’t meet the criteria for international cities, it’s hard to prove him wrong.
I think it’s because SF is small and feels pretty suburban – and it’s very isolated from Europe and Asia. (It’s a daunting 11-12 hour flight to get to either.) I was born here and live here now, but I lived in Paris and London for many years. Those cities are big cities, and much more international destinations. Paris gets nearly 30M visitors a year and I imagine London is similar! I love SF, but it’s a city where you need a car (hence hideous traffic that kills your soul and commuting from SF to Silicon Valley in a car is really not worth any salary!) and reminds me more of Boston, Seattle, or Portland than it does Paris or London. Those are huge, world-class destination cities. I like SF, but it’s definitely sleepy and a one-industry town.
You do realize you are committing heresy here? You best be careful. You might get burned at the stake! It is forbidden to say anything which might be construed as “negative” about North Korea….. I mean San Francisco.
The traffic is hideous. It was hideous 30 years ago. It’s much worse now. Mostly because the majority of folks working in the city, live in the suburbs, and public transit is so so (if available at all).
I like the old San Francisco (pre-internet) better. I think it was more fun!
Oh well….
I really like all your articles. But, your numbers don’t make an international city.
No one- NO ONE in Europe talks about San Fransisco in conversation. There are 3 cities: LA, NYC, and Chicago that you don’t need a state.
If you say “San Francisco” you say- San Francisco, California. That is all.
Maybe we talk to different Europeans? I visited around 10 European countries over the past three years and everybody knows where SF is when I tell them that’s where I’m from. But many have never been.
If what you say is true, all the more reason to be bullish about SF because once the Europeans start “discovering” San Francisco and realizing it’s like some of the beautiful cities along the Mediterranean, but with huge wealth opportunity, SF will rocket in price. The Euro rich vs Asia rich will create a frenzy!
I’m curious about the Hawaii bit, was their no chance at anything below the 3.5mm, you know maybe a bike ride further away for a couple million less? Is it possible to live with your parents for 6 months out of the year, I mean maybe ask them to build a guest house, just an idea.
The average house price on O’ahu is under 800k. The house and neighborhood he used is literally where the richest people on the island live. You could go 20 minutes east or west and buy a house for under 750k in a middle class neighborhood.
(Cont.)
If you compare SF to HK, London, NYC, etc., APPLES TO APPLES, SF is not much cheaper! Sure, the heart of London is expensive, most of Manhattan is expensive (not way uptown)…but other areas of London, and other NYC Burroughs are nowhere near $1000+ PSF.
Also, SF is much smaller, so most of it is prime, and expensive. You really need to compare the Bay Area to NYC inc. all the Burroughs. Same for greater London.
Not sure how I’m not comparing apples-to-apples:
1) Compared three prime locations in Hawaii (Kahala), San Francisco (Presidio Heights), and New York (Greenwich Village and Central Park West)
2) I live in SF and go to open houses for fun at least once a month. I go to Oahu 1-3X a year and look at open houses. And I go to NYC 1-2X a year and also check out property.
3) I’ve lived in SF, Honolulu, NYC, and visited a majority of the cities on The Economist’s list. The Economist’s list is just ONE list. Here’s another list from the Cost Of Living Index which puts SF below NYC and Honolulu as well.
I’d love to know about your property and living experience. Where do you own?
thx
Because you can find plenty of nice places in Manhattan for $2000 psf. Same as a nice condo in pac heights. Yes in general Manhattan is pricier and there are less SFH’s, but there is plenty of price overlap with SF. Also, lower Manhattan is cheaper, as well as Harlem.
And someone else gave you a $700k SFH example in Hawaii.
I agree that SF has solid growth potential wrt intl city status, and the tech industry plays a large roll, as does asian money coming here to purchase assets and RE. But it’s still is, and has been for decades, a pretty expensive city (maybe not the most expensive, but always in the top tier.) Since the tech industry became such a powerhouse the last two decades you could say that SF has become less of a prime niche city and more of a global destination.
The $700k example is not apples to apples. I thought that’s what your pain objection was? I’m comparing across tier 1 properties.
Please share with me your ownership and living history. Id love to understand more of where you are coming from. Do you live in SF now? Have you lived in Honolulu or NYC?
Thx!
Claiming SF is cheap because it’s not on the economist list is a ridiculous argument! How do you know the economist didn’t consider SF as part of the pool? Example, Monaco is expensive as hell and isn’t on the list either. And propping up a home that you like in golden gate heights as the primary example is also misleading. Yeah it’s an undiscovered little pocket, but anecdotal only. SFH’s in SF average closer to $1200-1500 a sq ft if you average most good neighborhoods. Just like I can get a cheaper place in Manhattan way up the avenues, that doesn’t reflect the average price in the established neighborhoods.
You really need to compare apples to apples.
Hi Sam,
Where is Bangkok on the list? It is a cheaper city and I see more white faces on the streets of Bangkok than when I walk around in some parts of the Bay Area…
-Mike
Great question! Where is Bangkok and Kuala Lumpur on the list? Two of the cheapest cities I’ve ever lived in.
They don’t make the cheap list because this list I’ve got is based on wealth-creating potential. Job pay is low in Bangkok and KL, and the wealthy entrepreneurs all seem to be firmly entrenched with the government. Hard for any immigrant to come in and create their own fortune. Whereas in SF, I feel anybody with smarts and determination can make a very good income or create something valuable. Thoughts?
I linked to this at BiggerPockets.com
https://www.biggerpockets.com/forums/99/topics/153140-san-francisco-real-estate-is-cheap?page=1#p1026215
I hope that’s OK.
You should come over some time. Mark Ferguson is a regular there.
Hi Jon,
Definitely OK! Thanks for sharing my work there. I’m supposed to do a podcast at BP one day. Just need to get around to filling out their 2-page questionnaire.
Thx
I found this article very interesting. I had always heard how outrageous prices were in San Fran but they look positively heavenly compared to New York. I guess it really depends on your yearly income in terms of affordability. If San Fran really has that many great jobs, then I guess the sky is the limit with the quality of life you can find there.
Where I live, you can get 3 bedroom houses for less than $100k so affordability is off the charts!! The only thing is that incomes tend to start much smaller here versus other big cities.
As a O’ahu native, You’re comparison to Honolulu is a bit off. Kahala is one of the richest neighborhoods on the island. There are plenty of single family homes that are much cheaper and still in desirable areas.
I’m trying to do like-for-like comparisons of the neighborhoods I like in San Francisco, to the neighborhoods I’d live in Oahu, and New York City.
Any other suggestions for Oahu? Hawaii Kai, Diamond Head, and Wai’alae Iki seem nice.
I’m not real sure what the neighborhoods that you like are actually like in San Francisco (I’ve never been). I can tell you that Kahala is where most of the 1%ers and old money live in Hawaii (along with a couple other places). Hawaii Kai has a lot of upper middle class families as do some towns on the Windward side. If you’re doing a comparison of the richest areas in each city, then I guess you’re on point. Although, most of the housing on Oahu is nowhere near that expensive.
I think Kaimuki is the best location with the best value don’t you think? The houses have nice views and just need to be updated.
Yes, Kaimuki is a nice area. Close to downtown and Waikiki. Close to a few good private schools (most people opt of the public school system in Hawaii). Also close to the University of Hawaii campus. It’s centrally located, not too expensive, and close to everything so you don’t have to deal with the terrible traffic. I have friends who live in Ewa Beach and Kapolei and spend at least an hour each way when they commute. The houses out there are newer and the communities are planned so it attracts a lot of families. My friend bought a 5 bedroom duplex in Kaimuki for 700K. It needs to be updated but you get a clear view of the ocean and diamond head out the kitchen window. You can update a house, but you can’t update a view.
Sounds like Kaimuki is the best value in town then! :)
I’m a fan as I’ve been going back there for 37 years.
The views, oh the views. Where do you live?
I think I would shoot myself if I had to commute from Ewa Beach or kapolei.
Maybe SF Real estate has a built in discount due to its volatility, much like the volatility of the valuations of main employers outlined in this thread. What if many of these “momentum” or “social” companies and their respective stocks fall out of favor. Stock price goes down, layoffs occur, pay gets cut. The chances of this happening for the core tech SF companies are higher than most other industries. I work in NYC and live directly across the river. You can buy a 2400 square foot brownstone on my block for 1.8 million and commute in the city. Sure, you dont have Manhattan zip code, and thats what important…but my point are there are options if you love/work in NYC. FS, using 15 CPW as an example is a bit extreme!
Have you tried looking for comparable condos in Brooklyn? It’s where all the young, dynamic people have gone, and New York is bigger than just Manhattan.
With one million dollar or even less to spare, one can comfortably retire pretty much anywhere in SE Asia. Cheaper cost of living, happier people, better food, etc.