With remote working more popular than ever – companies like Google and Facebook now say employees can work from home well into 2021 – people are leaving SF en masse. A new Zillow report further supports this idea, showing a 96 percent increase in local inventory lists over the previous year.
It’s a bit common these days to find Craigslist ads under $ 1,000 for single rooms in areas like Lower Haight, Inner Sunset, and The Castro – all neighborhoods where you’d be hard pressed to find anything close to that price before Prepandemic. For the first time in over a decade, San Francisco now has both a tenant and a buyer’s market, with property prices falling steadily as the Bay Area property market continues to depend on poor business.
There is definitely some suburban madness that mostly sees apartment buildings in San Francisco lying in the dust.
Oakland and Berkeley (Inner East Bay) haven’t changed much, and people are still buying single-family homes in San Francisco. pic.twitter.com/tkW8temvpv
– @ 🍫 𝔒𝔴𝔢𝔫𝔰 (@IDoTheThinking) August 14, 2020
The recent (and widespread) Exodus event in San Francisco was highlighted in the 2020 Urban-Suburban Market Report by Zillow, an online real estate company, which found the city’s real estate inventory to be 96 percent year-over-year. In contrast to every other metropolitan area mentioned in the study, vacant SF houses came on the market in large numbers.
It’s also worth noting, however, that the inventory of homes for sale in San Francisco this time of year has been consistently low for at least a decade … not to mention that the city is predominantly populated by a rental cohort. Since the current average price for a home in town is $ 1.4 million, and most financial advisors recommend that you pay a 15 percent down payment on the home you want to buy – which, if you do the math, translates to $ 210,000 would charge in this scenario – it’s no wonder why thousands of locals choose to rent instead of their own.
The reasons for the enormous influx of new offers? They are as diverse as they are similar. But by and large – and what we’ve also found in our own reports on San Francisco’s “pandemic prices” and mass losses – is that people are looking for “more comfortable living” elsewhere.
People are moving to cheaper cities (like Chattanooga, Tennessee) to “take their time back”; Former Franciscans swim in the sunshine and cut the cost of living in Palm Springs and Lake Tahoe. Austin’s startup culture, nestled in the Texas Hill Country, is now even more enticing for twenty and thirty.
And with city dwellers increasingly working for large tech companies that have now essentially adopted near-permanent remote working structures, it’s understandable why people are fleeing the Bay Area’s notoriously high cost of living.
Although the theory that the recent San Francisco exodus was solely related to a distant rise in lifestyle is not as straightforward as one might think, according to SFGATE.
“It may be tempting to attribute the city of San Francisco’s inventory boom to the advent of remote working that came with the pandemic, but one only has to look to San Jose to question that narrative,” said Josh Clark, an economist at Zillow to Andrew Chamings from SFGATE. “The San Jose subway, which is technically dominated like the city of SF, has not seen a similar increase. Two things that could make the difference are the density of San Francisco and the lower proportion of family households.”
And … well: the cost of living. According to PayScale, a website that compares and contrasts the cost of living in cities across the country, the cost of living in San Jose is 17 percent lower than San Francisco – with a whopping 25 percent cheaper housing costs.
In the report, the 96 percent year-on-year increase in new vehicle registrations for the San Francisco metropolitan area is described as a “significantly larger jump than in the surrounding suburbs,” the report said. Other metropolises in the state like Los Angeles and across the country – Miami, Boston, Seattle, and others – are actually seeing a decline or at least a flattening of their overall listings.
You can read the entire Zillow report here. Check out these two $ 25 million properties (one overlooking Marina Green, the other overlooking Pacific Heights) that recently hit the market.
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PICTURED: Aldric RIVAT