October 21, 2014|Lauren Hepler| Silicon Valley Business Journal| Link
Forget, for just a moment, all of the hype about Silicon Valley’s mythical millennial tech talent clamoring for newfangled luxury apartments.
New monthly data for September from Realtor.com reveals that the region’s for-sale housing market is also crazy as ever.
Homes listed in the San Jose and San Francisco metro areas have only been on the market for a median 36 days, which leaves the Bay Area locales tied for the designation of the second-fastest-moving residential real estate markets in the entire country.In what could be a testament to concerns about skyrocketing prices in San Francisco and Silicon Valley sending prospective buyers fleeing to farther-flung Bay Area housing markets, the neighboring Oakland metro area boasted homes with the shortest median time on the market at 35 days. Oakland also had the most inventory, with 4,175 homes on the market as of September, compared to 2,050 in the San Jose area and 2,397 in San Francisco. Median home prices were $500,000 in Oakland, $718,000 in San Jose and $949,000 in San Francisco. See the chart at the bottom of this story for a breakdown of how the Bay Area housing markets stack up against other fast-growing tech hubs like Austin and Seattle when it comes to pricing and the amount of time homes are listed for sale. The upshot for those looking to buy homes in the Bay Area — in case you haven’t heard the horror stories of competing with all-cash buyers or brokers specializing in selling homes before they even hit the market — is that competition to buy is extremely fierce, even if you can afford high boom-time prices. As I have reported, median home prices that have in some areas surpassed $1 million also undermine the ability of even middle- or relatively high-income area workers to buy a home. Unaffordability pushed some would-be homeowners into the crowded rental market and some into buying in cheaper areas that can entail grueling commutes — that is, if they don’t decide to pack up and move somewhere much farther away that offers much more house for much less money. Recognizing the potential economic threat posed to the region by unaffordable housing, local cities are now deliberating how to pay for and build new housing for workers at all income levels. Part of that debate is how much new housing should be single-family homes versus rentals targeted for more dense areas.
When it comes to the bigger picture for national home sales, Realtor.com Chief Economist Jonathan Smoke notes in the new report that baby boomers adjusting their real estate portfolios before retirement and booming employment in STEM fields (science, technology engineering and math) are likely two big factors driving the market.
“When we see homes moving quickly in a particular market, we expect the trend to be supported by signs of local health like growth in industrial production and employment,” he said. “This month, we also observed more out-of-the-ordinary trends, including high proportions of math and science professionals, as well as baby boomers in each of the fast-moving markets.”]]> Follow Us