Well, if that is the case, they will have to raise salaries. If people are willing to commute, they won’t have to.
Many teachers would much rather teach in a well funded school district that doesn’t have as many of the problems that might happen in a cheaper-to-live area. They will travel for that. I imagine cops are the same.
If the commute becomes too bad, then the city raises salaries until they do, or provide housing assistance (which is the same as raising salaries).
Have you not noticed the fact that inventory is piling up in both these places? And there won’t be any more buyers coming out of the woodwork, now that zero-down loans are pretty much a thing of the past.
Roboto, how can you see statistics that show it takes $200K annual household income to buy the median house in an area and that the median household income is well under $100K, and think that prices will do anything but continue to drop? Where is the disconnect? Who will magically be buying all those houses?
And especially with teachers, this is becoming less and less of a problem in SF, since city dwellers are increasing childless-- it has the lowest number of children per capita of any large US city. And not just because of the large concentration of gays, either. 
Well…if that is the case, wall it off, wait a 100 years, then open it back up to colonization. 
Exactly my point. Supply now outweighs demand. Prices by default will now have to go down until people start buying again. How far down is determined by what they buyers are willing to pay. 10%? 20%? 50%? You won’t know until they start selling again.
I think if the Fed drops the interest rate another half-percent, the housing problem goes away. Just a guess.
And I heard someone today refer to the “mortgage meltdown” as more of a “self-cleaning oven”, burning out the garbage loans that should never have been written in the first place.
Long term, CA goes up. People who are in it for the long haul will be just fine. I, however, am thinking of cutting and running! 
I have lived here all my life, but I want to do more than tread water in paradise…
Frist of all, itis you that switched locations. You first post talked about Silicon Valley, not just the City of SF. “The trend is already happening to some extent. In places like Silicon Valley, government employees, and workers in other (necessary) sectors with lower paying jobs cannot afford to live in the communities they serve.”
And then, you see, you can ride your bike to SF from cheaper cites (So SF for example). So the fact that rents are expensive in one particular neighborhood means nothing when you are talking about.
Both **John Mace **and I actually live here. You do not. You have no didea of what the housing situation really is. All you are doing is reading alarmist newspaper articles that are designed to sell papers, not reflect reality. I posted cites and facts.
And if you want just SF, according to Craigslist today, there are 1824 listing in SF proper. 654 (or 36%) are under $2000.
In South SF (borders right on SF) over half the listings are under $2000.
You living there means nothing when you clearly have no understanding of what the market is really like. I tend to trust respected newspapers and the SF Chamber of Commerce, et al. more than I do some guy on the internet who is talking out of his ass and appealing to his “brother’s” supposed authority.
The link earlier had a map based on Craig’s list prices. The average the guy came up with was close to $2000. So yes, many listings will be under $2000. That is by no means affordable. You’ve done nothing to prove your point other than whine about how your brother is an expert on these matters and how you live in the area. Learn how to debate, and come back with some cites that validate anything you are saying, and maybe there might be a discussion to be had. Cites that state any of the following things:
Teachers, Nurses, Cops, etc. have no problem finding affordable housing to either rent or buy in Silicon Valley, and/or San Francisco.
The SF Gate and the SF Chamber of Commerce are alarmist.
The housing crunch has been overstated.
That those in the aforementioned jobs have a decent chance to buy a house in the areas we spoke about.
No one, I mean no one “respects” the Chronicle. It’s a joke. Really.
I gave you a cite from the City of San Jose. Not a second hand cite from a “Chamber of Commerce”.
Again, you don’t know what you’re talking about. **John **and I live here.
As someone who does, indeed, have intimate knowledge of the Bay Area housing market, I can say it sucks. I despair that I will never be able to own a house in my state.
A lot of those “under $2000” apartments have some strings. I know a girl who rented a front porch in Santa Cruz for $400. I know a lot of people who live in somewhat affordable situations, but their apartments come with wierd strings like they have to leave on Wednesday nights so the owners can have cult meetings there (true story) or the place is so rotten it’s about to fall down, or it’s a illegal sublet where everyone is in a risky insecure situation.
What do people do? They work several jobs. Or they pack three people into each bedroom. Or they put everything they can on their credit cards and hope things start looking up soon.
Anyway, I’ll be getting back to California around next June. I hope finding a place to live is a little easier this time around.
But the fundamental problem is that you really really want to live in an area that millions of other people really really want to live in, too. When you and millions of other people want X, and there’s only a limited amount of X, then the price of X is going to rise until people give up in disgust.
Do you want to own a house, or do you need to own a house in the Bay Area? If it absolutely positively has to be a house in the Bay Area, there’s a million other people just like you who absolutely positively have to have a house in the Bay Area. And in that situation, it’s easy to do the math.
Maybe not your home town or it’s immediate area, but your state? Sure. It’s just not in areas where you would want to live (or maybe you would- I don’t know), like San Bernardino & Riverside counties, plus probably a bunch in the central CA.
Wanna good laugh? My grandfather bought a house in Balboa on the beach for $4500 in the 1940’s, and my parents scored a 5 bedroom house on a huge lot in Newport for about $60,000 in the 1970’s (my parents still have them both). The beach house would go for over $2 million as a tear down, and the other for about $1 million. Go figure.