According to data from real estate listings website Zillow, home values made the biggest jump from Dec. 2020 to Nov. 2021 in ZIP codes in more suburban and rural areas, while they had the smallest change in city centers, including many San Francisco ZIP codes.
The ZIP code with the biggest increase of about 38% was Sea Ranch, the small, rural community on the Sonoma County coast that boasts unique architecture and dozens of trails. Coming in second at 28% is another seaside town, Bolinas, that sits 30 miles north of San Francisco in Marin County. A third waterfront community, Bethel Island in Contra Costa County, had the third highest home value increase of 27%.
Matt Kreamer, a data spokesperson for Zillow, said the Bay Area, particularly San Francisco, has long been one of the priciest places to purchase a home, and also has a high share of remotable jobs.
“What you’re seeing in these rankings are exactly the trends we’ve seen in the Bay Area for several years, and they accelerated during the pandemic,” he wrote in an email. “Over the past two years, as more and more people became untethered from offices, we’ve seen home values in the suburbs shoot up much faster than in the urban areas.”
Zillow’s data attempts to reflect the typical home value in ZIP codes across the country. Home value estimates are not just based on the prices of those homes that recently sold, but rather estimate the value of all homes in a ZIP code based on trends in sale prices of similar homes in the area. We narrowed the data down to only ZIP codes in the nine-county Bay Area with at least 1,000 residents.
Contra Costa County appears 10 times in the top 20 ZIP codes in growth and Alameda County six times. Suburban towns are strongly represented: San Ramon, Pleasanton, Livermore, Castro Valley and Brentwood all appear on the list. Kreamer said the East Bay’s growth has been particularly rapid, simply because homes are more affordable in the region.
“The East Bay is less expensive than San Francisco, though prices are rising more quickly,” he said. “And buyers can get more for their money: larger homes and outdoor space, both of which became more desirable during the pandemic. But it’s still close enough to commute to the office a few times a week, and to take advantage of San Francisco amenities.
In the South Bay, many of the ZIP codes with the biggest growth over the past year are in San Jose. Home values in six San Jose ZIP codes all went up by at least 20%. Kreamer said the trends in the South Bay are a bit different.
“I think a big part of that is the home types,” he said. “People looking for more space don’t necessarily have to look farther away. So if that’s more important than lower prices, it’s much easier to stay in a more urban environment, and closer to amenities.”
At the bottom of the list is La Honda in Santa Clara County with a decrease in home value of 6%. Home value prices in the 95113 ZIP code, which is in downtown San Jose, went down 1%.
Six of the ZIP codes in the bottom 10 ZIP codes are in San Francisco, including 94108 that only increased by 0.3%, and includes Union Square and parts of Nob Hill and Chinatown. Kreamer said while home values are growing everywhere much faster than normal, San Francisco slower growth is not all that surprising.
“San Francisco’s home value growth is among the slowest in the country, but that’s all relative,” he said. “The Bay Area has the highest home prices in the country, so it’s more difficult to afford to live there. The fewer people there are who can afford to buy, the less demand there is, and that tempers home value growth.”
And, he said this doesn’t mean there is an exodus from San Francisco. In fact, he predicts it is actually likely to pick up because more people are arriving in the city now than during the heart of the pandemic.
“Home values there are growing much faster than typical, also, just not as quickly as in the suburbs,” he said. “But there definitely is still demand. San Francisco is one of the great cities in the country, and the world. We don’t see demand to live there tapering off.”
Kellie Hwang is a San Francisco Chronicle staff writer. Email: firstname.lastname@example.org Twitter: @KellieHwang