The Bay Area braced itself in 2019 for a tsunami of tech cash that seemed poised to sweep away the region as we know it, but now it seems that this most recent year in housing was mostly a wash.
While some sources predicted that tech money would “eat San Francisco alive,” Compass real estate group, which assessed the state of the Bay Area in a report released last week, described the results as “basically flat—down a little bit up a little bit, or unchanged” depending on the city in question.
But mostly we saw changes in inches and degrees instead of leaps and bounds. Here are some key takeaways from the report.
- In San Francisco, a median single-family home in 2019 cost 1.6 million, and a median condo $1.24 million. While those are both increases compared to last year—and are both huge numbers—the growth is pretty modest, just 1.6 and 3.3 percent, respectively. For comparison, between 2017 and 2018 SF’s house median leapt more than 12 percent.
- In the South Bay, despite runaway prices in San Jose, Santa Clara County writ large actually declined from $1.33 million to $1.26 on average for a house, and $880K to $825K for a condo. Analyst Patrick Carlisle notes that “Santa Clara probably had the hottest major market in the country,” so things were bound to drop eventually.
- The East Bay region that includes Oakland and Berkeley dropped the most for home prices, sliding four percent to $860K, while the median price of a condo was exactly the same year over year in 2019 at $620K. Tough break for anyone hoping to flip.
So why the mostly quiet season? Carlisle offers a few speculative analyses, suggesting that slower population growth, bad press from regional social issues, and the federal government’s recent changes to the tax code might have blunted demand.
In 2018, data firm Core Logic hypothesized that the Bay Area may gradually but inevitably be growing too expensive to maintain growth (now there’s a concept!), and it could be that played out in the year to follow.
And of course, generally speaking the performances of many big-name Bay Area tech companies disappointed market watchers last year Although perhaps the IPO wave of 2019 just hasn’t hit yet.
The lock-out period for Lyft employees ended in September, and in November for much-bigger rival Uber. A lot of demand-side money is only in the last couple of months able to potentially spread; maybe some industry insiders are now considering digging into their shares in hopes of making some initial offers of their own.