The typical San Francisco or San Jose home earns more money per hour than actual human beings working average jobs in most of the country, according to real estate site Zillow.
In a report published last week, Zillow considers how the value of a median U.S. home changed year over year:
The typical U.S. home appreciated 7.6 percent over the past year, from a median value of $195,400 in February 2017 to $210,200 at the end of February 2018. That $14,800 bump in value translates to a gain in home equity of $7.09 for every hour the typical U.S. homeowner was at the office last year (assuming a standard 40-hour work week), a shade less than the federal minimum wage of $7.25 per hour.
Of course, homes have the advantage that they’re earning (i.e., accruing value) essentially all the time when markets are in an upswing.
If we assume a 24-hour workday for a home, the annual $14,800 bump is more like $1.68/hour, closer to the federal minimum wage of $1.60 that was in place from 1968 to 1974 (not adjusted for inflation)—which is still a bit unsettling.
Zillow also considered the case of some of the country’s most expensive markets:
The median U.S. household earned roughly $60,000 in 2017 ($58,978 to be exact), or a little more than $28 per hour. But in six U.S. cities—New York, San Diego, San Jose, San Francisco, Seattle and Oakland—owners of the median-valued local home gained more than that in home equity alone.
As Zillow crunches the numbers, earnings for Bay Area cities are rather startling. A typical San Jose home appreciated at $99.81 per hour, again assuming that the per day appreciation is condensed into the period of an eight-hour workday. For a San Francisco home, it gained $60.13/hour. And in Oakland, it earned $38.57/hour.
Note that Zillow relies on estimations of home values, which are not necessarily equivalent to home prices. However, actual price data is likely to send some workers into an existential crisis.
According to the California Association of Realtors, the median sale price of a San Francisco home increased by $454,000 between February 2017 and February 2018.
That’s more than 30 times what a worker at the federal minimum wage of $7.25/hour earns in 52 working weeks at 40 hours per week. ($15,080 before taxes.)
It’s also nearly 7.7 times the median U.S. per hour income of $28. And it’s more than four times San Francisco’s estimated median income of $103,801 in 2016, which is among the highest in the country.