The U.S. Fish & Wildlife Service is proposing to put the Yangtze sturgeon on its Endangered Species list. A recent press release from Zillow suggests that game officials might also want to consider adding Silicon Valley home sellers.
Keeping a sharp eye peeled for home sellers.
Zillow says inventory plunged 27.1 percent year-over-year in San Francisco, by which it probably means the San Francisco Metropolitan Statistical Area, which includes San Francisco, San Mateo, Alameda, Marin and Contra Costa Counties.
Apparently Zillow’s monthly real estate reports don’t track the San Jose MSA, but I suspect that the South Bay’s decline in inventory was similarly precipitous.
The downside? “Aging millennials and young families may be able to find more affordable new homes for sale this year” but–wait for it–“they’ll most likely be in further-flung suburbs with more grueling commutes to urban job centers.” Let me introduce you to the Bay Area Megaregion.
And did Zillow just use “aging” and “millennials” in the same sentence?
The upside? Rents were essentially flat–up a paltry 1 percent year-over-year–which, considering the number of new and expensive apartments coming on line these days, indicates that rents have leveled off, at least for the moment. My recent experience in leasing strongly suggests that new or refurbished luxury apartments have been responsible for much of the increase in median rent locally, and that rents for less-than-new, less-than-luxurious units have been flat since 2016.
“Flat”, however, is not the same as “cheap”.
Yangtze sturgeon mulls its options.
None of this is surprising. Rents are flat because migration to Silicon Valley is way down, although in my experience those still coming are affluent or will be shortly. That’s taken some pressure off rents, although rising sales prices keep rents stable by keeping many renters renting.
The Case of the Disappearing Inventory isn’t much of a mystery either. New construction that’s just a drop in the bucket, move-up buyers hunkering down in their starter home because they don’t have a move-up home to move up to, a booming local economy that keeps highly-paid workers from moving to Nashville, rising home equity that’s made the phrase “distressed seller” so 2008…Sure, lots of people are leaving, but not enough of them are homeowners whose departure would mean more homes for sale.
But here’s the real problem: if you already own a home in Paradise, where do you move? And if you do move, will you be able to come back?
copyright © John Fyten 2018