These charts show which Bay Area neighborhoods are seeing normal growth in home prices vs. steep acceleration

Using this number, we found that many neighborhoods in the northern and eastern parts of the Bay have seen their home values increase faster in the past few years than earlier in the decade. In San Francisco, the opposite is true: Most neighborhoods saw the most growth in their home values in the early 2010s, followed by sluggish or even negative growth in the years leading up to and during the pandemic.

The area under the curve, or AUC, is a number used to calculate the acceleration of an object over time. The bigger the area underneath a curve is, the slower its acceleration is over a given time frame. That’s because curves with lots of area beneath them likely grew early on, giving them more time to collect lots of area beneath them. The smaller the area, the faster the acceleration.

A neighborhood with perfect linear growth in home values, for example, would have an AUC of half the total area of a chart, or 0.5 — we scaled the AUC to be from 0 to 1. What we’re measuring isn’t quite acceleration. In our case, we’re just looking at how change in value over the decade accelerated without considering its price at the start of the decade. But it still gives a good idea of how home value increases are distributed for each neighborhood over the last 10 years.

To look at which neighborhoods’ home prices have increased fastest in recent years compared to the start of the decade, we downloaded data from Zillow on over 500 neighborhoods in the nine-county Bay Area region. We then looked at how the median price of a home in each neighborhood has changed every year since 2011 (we filtered out a few dozen based on missing data to end up with 536 neighborhoods total).

For each neighborhood, we plotted the yearly share of the decade’s growth that had already happened as of every September, from September 2011 to September 2021, the latest month with data available. We then used a mathematical formula to calculate the AUC under every neighborhood’s growth line.

We found that, in most cases, neighborhoods with the highest acceleration — i.e., the smallest AUCs — were in the East Bay and Marin County (Zillow’s data does not include all neighborhoods in the Bay Area, including many in Sonoma and Solano counties). The neighborhood that accelerated fastest (with an AUC of 0.24) was Richmore Village, a neighborhood in the city of Richmond. That’s because the neighborhood initially saw prices drop in the first part of the decade, followed by a steep upward increase in values starting in 2018. Over 40% of the neighborhood’s decade of growth in home values happened in a single year: between September 2020 and 2021.

The neighborhoods with the least acceleration (and largest AUCs) were mostly in San Francisco. In fact, of the 20 neighborhoods with the slowest acceleration in home values in the past 10 years, 16 of them were in San Francisco.

Of all the 536 neighborhoods we looked at, Chinatown, with an AUC of 0.93, saw the least acceleration over the past decade, even though its home value increased by almost 50%. That’s because all of its growth happened early in the decade; home values in the neighborhood have actually declined since 2017.

Just because a neighborhood had less acceleration doesn’t mean the home values in those neighborhoods didn’t increase over those 10 years. In fact, the 10 neighborhoods with the lowest AUCs still saw home values increase by at least 50% over the past decade, and most of them grew by a lot more.

A higher AUC in a given neighborhood just means that home values in that neighborhood saw more growth earlier in the decade, and they didn’t see the same recent skyrocketing of growth that many outer Bay Area neighborhoods have experienced during the COVID-19 pandemic.

This finding fits in with other analyses showing that the pandemic is causing what some researchers are calling the “doughnut effect.” As remote work became the norm for many knowledge workers, many metropolitan areas that serve as professional hubs saw widespread migration out of their denser centers into less-crowded suburban surroundings.

San Francisco was no exception. While home values boomed across the U.S. in the first year of the pandemic, a previous Chronicle analysis found that a majority of neighborhoods in San Francisco actually saw home values decline.

The AUC calculation, aside from being a fun way to visualize the effect of the pandemic on housing prices, also confirms that neighborhoods in San Francisco have seen slower or even negative growth in home values during COVID-19, while neighborhoods in relatively less dense and pricey regions, like Contra Costa and Alameda counties, have seen much faster growth during the pandemic.

The data also sheds light on just how extreme the COVID-era housing boom has been for many neighborhoods in the Bay. When looking at the relationship between a neighborhood’s overall growth in home values and its acceleration, we found that neighborhoods with a larger share of growth in the last few years (i.e., a smaller AUC) also tended to have grown by a bigger percentage in the decade overall.

That is, the recent COVID home value explosion has been particularly acute.



Susie Neilson is a San Francisco Chronicle staff writer. Email: susie.neilson@sfchronicle.com Twitter: @susieneilson

Article source: https://www.sfchronicle.com/bayarea/article/We-charted-the-acceleration-curve-for-Bay-16623997.php

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