Prices in the Bay Area are dropping, but the real estate market is still tight
Despite dipping prices and slower sales activity, finding a bargain in the Bay Area still remains a challenge.
According to a recent study from Redfin, home buyers throughout the nine-county region are most likely to pay above list price, waive contingencies, purchase swiftly, and create a financial windfall for long-time homeowners.
The study reveals some of the prime spots for Bay Area sellers, which are:
- Contra Costa Centre
- Mountain View
- Palo Alto
- Pleasant Hill
- San Carlos
- San Leandro
- San Lorenzo
Most competitive in the country
There were nearly 70 Bay Area cities in Redfin’s competition index that were rated 90 and above, making the region the most competitive in the country.
The real estate firm ranked more than 1,000 cities in the US using information from agents along with sales and listing data to take a look at the length of time a home spends on the market, the number of offers it received, whether buyers chose to waive contingencies, and other important factors.
While the Bay Area real estate market has slid down from last year’s peak, it still continues to frustrate buyers and make long-time homeowners happy with record-high prices. The intense bidding wars among Bay Area buyers may have already cooled down, but compared to other markets in the country, the region is still one of the most difficult to buy into.
Employment opportunities continue to grow
Last July, nearly 5,000 jobs were added to the Bay Area, with skyrocketing employment growth in Santa Clara County, San Francisco, and the East Bay. The nine-county region was responsible for four out of ten new jobs in California during the first half of 2019.
Jobs have helped the Bay Area stay resilient and retain its status as one of the most competitive markets in the US. While it might be difficult to measure the effect of tech IPOs on the market, the availability of new, high-paying jobs can stabilize and eventually increase prices in the market.
Home prices are undervalued in certain Bay Area cities and counties
Despite a record-setting streak of soaring home prices, some economists think homes in a few Bay Area communities might be considered a bargain, even with median price tags clearing the million-dollar mark.
After analyzing historic and current income and housing trends, real estate data firm CoreLogic discovered that expensive markets in San Francisco, San Mateo, and Marin counties are undervalued to some degree. Their analysis, which considered factors such as past market experience, home values, and disposable income, revealed that the Oakland and San Jose metro areas were priced fairly according to historic standards.
It’s great news for Bay Area homeowners, but something that could make it more challenging for home buyers looking for properties in some of the priciest counties in the country, such as San Francisco, San Mateo, Marin, Santa Clara, Alameda, and Contra Costa.
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