San Jose rents remain crazy expensive—even for IT professionals making six figures—with the gap between wages and housing costs officially the largest in the country, outpacing other tech hubs such as San Francisco, Atlanta, Boston and Seattle.
According to a new study from rental listing site RentCafe, IT wages in San Jose still lag far behind rental prices, even as housing costs have started to flatten. From 2016 to 2019 rents increased by 6.9 percent, while between 2014 to 2017 IT wages fell by 0.8 percent.
The study used different time periods because rent prices are usually affected a few years after there’s been an increase or decrease in wages, Florentina Sarac, the author of the study, told San Jose Inside.
San Jose has the most tech jobs of any city in the U.S.; they comprise 12 percent of the market. The number of IT jobs has only been increasing as multinational companies and startups continue to flock to Silicon Valley for its proximity to talent and venture capital. The tech boom has for years been putting a strain on the rental market as demand shoots up. The average rent in the San Jose metro area is $2,871, according to the study.
“As it happens with most tech hubs, following a big boom in the IT job market, a considerable number of people start relocating to the area,” Sarac said.
But while IT workers in San Jose still have the highest average wage at $126,000 compared to other tech hubs, wages have decreased slightly in the area. Boston was the only other tech hub that saw decreasing IT wages, according to the study.
Sarac said this may be because employers are doling out more non-financial perks such as flexible working hours, more days off or the possibility to work remotely.
The combination of increasing rents and decreasing wages may make renting a challenge even for IT workers making six figures. Rents have been steadily increasing since 2012, Sarac said, while IT wages tend to fluctuate.
“IT professionals living in San Jose metro should keep in mind that rent prices might continue to rise in and around the area,” Sarac said. “It would also be a good idea to keep an eye on nearby emerging tech-hubs like Portland metro and Salt Lake City metro, where the cost of living is considerably more affordable at the moment.”