Home prices in these 10 Bay Area cities jumped the most during the past year of the pandemic

But, in particular, the past year has seen Alameda and Contra Costa come into focus as real estate hot spots: The 10 big cities with the highest percentage growth in home prices from February 2021 to February 2022 were all in those counties.

Union City, Dublin, Pleasanton, San Ramon and Danville were at the top of the list, as prospective buyers entered bidding wars to snap up desirable properties, according to Zillow.

“People like location,” said Ronnie Escalante, a San Francisco-based Realtor. “People also like quality of life. These are nice neighborhoods where … you’re in the middle of everything.”

A typical home price in Union City in February 2021 hovered at $1.05 million, according to Zillow. A year later in February 2022, that was closer to $1.38 million, a 32% increase year-over-year for the Alameda County city — the highest in the metropolitan area.

In San Ramon, the average home sold for $1.43 million in February 2021. In February 2022, that number was $1.83 million, a 27% increase year-over-year and the highest in Contra Costa County.

Typical home prices are calculated by Zillow economists by averaging the median 30% of homes sold.

Buyers are considering a wider range of cities now that remote work is here to stay. Although some workplaces have returned to the office, whether fully in-person or in a hybrid setting, more than 60% of companies nationwide expected to keep their expanded work-from-home changes after the pandemic ends, according to a February report from the Bureau of Labor Statistics.

They’re also evaluating social and cultural life in each city. Before the pandemic, people rented or bought homes in big cities such as San Francisco and Oakland for the access to restaurants, nightlife and museums.

But as availability of those amenities shrank during the pandemic, so did demand to buy in those areas, said Jeff Tucker, a senior economist at Zillow.

Before, the I-680 and I-580 corridors may have felt far from bustling employment and nightlife centers. Now, suburbs with easy access to BART and freeways are appealing to people seeking more space.

“The East Bay is looking attractive as a sweet spot where you’re close enough to participate in urban life, get to offices or hang out with friends but still your money goes further,” Tucker said.

Still, San Francisco homes got more expensive during the pandemic. Typical home prices went up nearly 12%, from $1.41 million in February 2021 to $1.58 million in February 2022, according to Zillow.

Some smaller locales throughout the San Francisco metropolitan area have also seen spikes in price growth. Emerald Lake Hills in San Mateo County and Bolinas in Marin County experienced the largest year-over-year growth in their counties, at 24% and 28% respectively.

The data provided by Zillow looked at 99 cities in Alameda, Contra Costa, Marin, San Francisco and San Mateo counties. Only two communities, La Honda and Pescadero in San Mateo County, saw a decrease in typical home price from February 2021 to February 2022.

Those places are small, with populations of under 1,000 people, according to the U.S. Census Bureau. A few more homes may have been built there during the pandemic, but their low housing stock makes it hard to determine why prices have changed, Tucker said.

So, with interest rates starting to tick upward, will housing prices drop anytime soon in the region? Experts don’t think it’s easy to predict.

“We are seeing so many people throwing down offers, and everyone’s looking for a deal,” Escalante said.

Tucker, the economist, thinks the pandemic accelerated the dreams of many who might otherwise have put off purchasing a house for a few more years. A combination of low interest rates, remote work and restricted access to their social lives has prompted them to re-evaluate their priorities, he said, and snap up homes as fast as they come on the market.

“People don’t mind paying more money than God for a house,” Tucker said.

Gwendolyn Wu (she/her) is a San Francisco Chronicle staff writer. Email: gwendolyn.wu@sfchronicle.com


Article source: https://www.sfchronicle.com/realestate/article/bay-area-home-prices-17089346.php

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