It is no secret that the Bay Area is one of the most expensive places to live in the country. The booming tech industry has catapulted its status as a premiere living center for high earners. Even with these attributes, many workers in the tech industry are still keeping their eyes peeled for more reasonable prices. In our last blog post, we discussed the effects of the work-at-home method being implemented long term, due to the ongoing COVID-19 pandemic. This new found flexibility for commuting has made the East Bay a much more viable place than ever before. Recent real estate data has shown that the market is currently thriving, as an increasing number of people look to move to a more affordable area with more space for their family.
Current Housing Prices
Since the start of the tech boom in 2012, there has been a rapid increase in the median house sales price in San Francisco throughout the past eight years. The limited space and active economy within the city has kept the prices from dropping, despite the pandemic and wildfires. Many wealthy buyers are continuing to pick up high end homes in the most expensive counties, which has led to current median prices ranging from $900,000-$1,700,000. According to sources from Mercury News, there has generally been a rise in demand from tech worker families for more housing space, especially during a time of periodic lockdowns that are keeping people indoors. The ability to cut back on megacommutes has made moving to the East Bay more palatable for prospective homeowners. This has been a major factor to the current bidding frenzy for properties in the area, especially in Walnut Creek and Pleasanton.
Both Contra Costa and Alameda counties have seen a much higher percentage of accepting offers compared to 2019. Contrast this with San Francisco condos and houses seeing an inverse effect. This indicates that the East Bay is a buyers market and the trend will continue as single family households within the city are assessing more affordable options.
East Bay Real Estate
The East Bay prices have kept their stability through the pandemic. Many metrics from the California Association of Realtors have indicated that the market is thriving right now. More specifically, the Months of Supply Inventory (MSI). MSI quantifies how many months it would take the market (in its current condition) to absorb the entire active inventory. If MSI is displayed as less than 4.0, sellers have gained asking power. If MSI is above 6.0, buyers have gained negotiation power. The MSI (as of August 2020) is 1.9 for East Bay counties, which is lower than California’s average of ~3 MSI. This further indicates a sellers market and that there are many lucrative opportunities to invest into the area and profitably divest. Our firm is looking to tap into the potential of the East Bay becoming a new home for many in the near future. If you are interested in our current investment proposals, please give us a call!
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