Given how small SF is, and given how many multi-millionaires are minted with every big and even not-so-big tech company exit -- not to mention a steady population of bankers, traders, lawyers, doctors, etc. -- it seems like there is absolutely no end in sight to what is happening in the housing market there. There are probably more people flush with 7+ figures of cash to buy there than there will ever be available inventory in the foreseeable future. I would be extremely curious to see the demographics of all home buyers over the last few years, and/or what percentage of sales in the city are all-cash offers or at least could be done as such if the buyers desired.
Recently went to an open house in Hayes Valley. Asking price 2.595 million. Checked back with a real estate agent later, and got these stats: There were 6 offers, 5 of which were all cash. The winning offer was for 3.3 million.
My Uncle in-law sold his house a couple months ago in Santa Clara (right next to Levi's stadium) and was asking for $1.2MM hoping to actually get 1.3 for it (a problem unto itself..). They took a $1.5MM offer (from about 5 other similar offers) from a young couple who both worked at Uber and also got significant help from parents. Wasn't all cash but I believe they put down like $500k. So it's not just tech but sometimes tech with the help from family.
And what an awful area. Oh it's clean and safe enough. But basically landfilled industrial parks (and Levi Stadium). I despise going to the Santa Clara Convention Center for events.
I agree, I lived next door to him for 5 years. The stadium, Great America, Ace/Amtrak train, and being in the direct flight path of San Jose airport made for quite a bit of noise. Every house in the neighborhood had double-pane windows for that reason.. Not to mention the occasional waft from the nearby wastewater facility makes me more than happy that I no longer live there.
Not really sure what the buying couple saw in the area. The house was really well-kept and updated but I feel there were other homes in much better surrounding neighborhoods for a similar price-point..
Probably close to 101 & 237 and within their budget. Most of Sunnyvale & Mountain View are in the $1.7-$2.3M range, and to get back below $1.5M, you either need to go south of Central Expressway or into a very old, non-renovated home in the middle of a subdivision. If you work along the 101 corridor that can easily add 20-30min to your commute.
Amazing. Would kill to see the respective employer(s) of each bidder. That would be fascinating. I still wonder how much developers and/or foreign buyers are in the mix, but I have a feeling that's not the dominating factor here.
I'm thinking of all the people who did/will make that much or more with each large-scale exit. How many 3+ millionaires will the combined exits of Airbnb, Uber, and Pinterest create? (Any of which could be in the next few years.) Easily more than a thousand, I would guess.
I'm hoping there's a point where people are going to say, no... an old 1 bedroom apartment isn't worth $4k/mo. And where we collectively realize that maybe it's not great to be sending so much of our money to landlords.
I don't know if it will be collective, maybe more of a trickling off. I've already moved out to east bay; my company's generous work from home policy helped a lot in this regard.
Every time one of these Bay Area real estate articles gets posted, I yearn for a corresponding link about large numbers of new housing getting built somewhere in the Bay, or breakthrough approvals of transport infrastructure, or greater corporate acceptance of remote work, or further development of other tech hubs. The alternative is to despair in this bizzaro land of misery in unequal prosperity.
The article mentions 68,000 units in the new development pipeline (essentially all condos/apartments) but, yeah. In the current environment, you could probably double or triple the planned building rate and not have much of an impact--beyond making it that much harder for people to get around.
Especially since the cost of living is providing a "cap" to how many people stay, relative to how many newly minted millionaires and lucky startup exit employees there are.
That is, those companies "overflow" into other cities/countries because it's too expensive and there's not enough supply, but the moment you build more and the price would go down, some people who would have left don't, and so the price won't move downward. You'd have to flood the market faster than the big companies hire and startups grow to make a significant change, and that's a LOT of extra capacity to create.
Realistically, making other cities more desirable, encouraging the big tech companies to open more satellite offices than they already do, and more focus on working from home for people who can is likely to make a bigger difference than anything SF itself can do on its own (bonus, it would help other cities like NYC and Boston too!)
I get the VC dynamics with startups. Well, sort of.
But, with the big employers, they're sufficiently big that everyone's no longer co-located in any meaningful sense anyway. Amazon seems to have already gotten this message with respect to Seattle (not just HQ2 but also, e.g., their Alexa building/hiring in the Boston Seaport).
I'm not sure how this plays out. Hopefully not with some massive tech crash. But I have to believe we're hitting (or have hit) peak salary for new hires in the Bay area and, at some point, most people are not going to live in a dorm to work for Facebook. And, if they are, that's sad.
The big employers, for better or worse, in may cases still favor their mothership. Give the choice they seem to favor the HQ if they can. The satellite offices are required for scalability, but as long as they have capacity in the main office, they'll try and fill those slots up first.
Oh. I don't disagree. I think it's hard to give up the mothership vs. satellite mentality. I work for a company that had two major locations fairly early on (not including SV) for historical reasons and that's doubtless one of the factors that's made it easier to be pretty distributed as time's gone on.
