• A 20 percent deposit on an average-priced SF home is nearly $225,000.
  • Despite high home prices, buying is still perceive as a cheaper option than renting in San Francisco.
  • Rents are predicted to outpace home price appreciation this year.

Whether you’re using median or average home price data, the salary required to purchase a San Francisco residence is between $153,000 and nearly $181,000.

This salary range assumes you’re able to put down 20 percent deposit. Drop this deposit to 10 percent and you can bump the salary requirements up by $32,000.

According to Finder.com, $180,600 represents the annual salary required to purchase the average-priced home in San Francisco, which stands at $1.119 million.

This salary represents the highest requirement of the 78 metros analyzed and assumes a buyer is putting 20 percent down, which would equate to $223,900. A 10 percent deposit would come out to $111,950.

The city’s high salary requirement is attributed to its sky-high home values.

“The salary required to get a mortgage for the average home is higher than the salary required to cover mortgage payments, average debt and average expenditure,” Finder.com stated.

San Francisco homebuyers can’t skimp on a downpayment

Buyers looking to acquire homes priced around the city’s median home price, $809,400, will need to earn $153,152 annually, according to HSH. This assumes a 20 percent deposit ($161,800) and monthly payments of $3,573.

Drop the deposit down to 10 percent ($80,940) and HSH’s salary requirement spikes by $32,000 up to roughly $185,000.

For those that meet these salary requirements, buying is a cheaper option than renting in San Francisco. Several months back Trulia found it was 7 percent cheaper to buy then rent in the city, considering a median home price of $1.1 million and median rent of $4,400. It was also assumed a buyer would be putting 10 percent down.

Recent data from Zillow suggests buying should be the cheaper option moving forward, as rent growth is expected to outpace median home price appreciation in 2016. Rents are predicted to rise by 5.9 percent year-over-year to $3,536, with home prices growing by 3.7 percent.

Of note, Finder.com pointed to San Jose as having the second highest homeownership salary requirement at nearly $130,000.

Email Erik Pisor

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