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SAN FRANCISCO (KGO) — Students are back in the classroom, so are parents heading back to the office?

After a long year and a half, students across the Bay Area are leaving their virtual Zoom classrooms at home and finally stepping into a real one. The question is, will parents follow suit? How many employees are actually going back into the office in San Francisco?

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“Our arithmetic tells us less than 20% of employees are back to work in the entire financial district,” said Clint Reilly, the owner of a commercial real estate firm in San Francisco leasing space to companies in the hospitality, media, finance and tech industries.

“Originally we were expecting after Labor Day, there would be a large contingent of workers that would return to work, but the new Delta variant has caused us to reassess that number.”

So how many companies are physically back in the office?

“I would say part time, 50% are back in the office to some extent, but again, it’s not full time,” said Robert Sammons, a senior researcher for commercial real estate firm Cushman and Wakefield. “It’s not five days a week necessarily.”

Cushman and Wakefield is one of the largest commercial real estate firms in San Francisco and overseeing 85 million square feet in inventory. Sammons says 60% of their clients are tech companies and most of them aren’t planning to return to the office until January.

“Tech firms have been a bit slower in getting back to the office,” said Sammons. “The big players have delayed their return because of the Delta variant. But, we see that ticking up by the end of the year and by 2022.”

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Tech giants Facebook and Amazon announced employees won’t return until Jan. 3 Google pushed back their return date to Oct. 18 and Twitter just closed down its city offices in late July due to concerns over the Delta variant. Sammons says none of these big tech companies are terminating any lease agreements, which signals parts of downtown may continue to feel empty until January.

“Our vacancy rate is still clearly elevated,” he said. “But, we see that improving next year and the mid-part of the decade.”

The city’s unemployment rate has declined slightly this year from 6.2% in January to 5.4% in April, according to data compiled from the San Francisco Chamber of Commerce. But Reilly says compared to other major cities, we have work to do.

“For instance more than 40% of the workers are back in New York City,” he said. “San Francisco is really lagging the country in terms of the number of people who’ve returned to work.”

A recent poll conducted by the Washington Post found nearly one in three U.S. workers under the age of 40 has considered changing careers or their field of work since the pandemic began.

“Are you getting a sense of fear from these companies, given what we’re all going through?” ABC7′s Stephanie Sierra asked.

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“Not really,” Sammons said. “I think we’ve been through so much over the past two years, we are more or less learning to live with it.”

Most of Cushman and Wakefield’s clients that have returned to the office part time include companies in the professional business sector like law firm and accounting agencies.

Take a look at all of ABC7′s Building a Better Bay Area stories and videos here.

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Article source: https://abc7news.com/return-to-office-work-from-home-students-in-classrooms-remote/10962897/

Although Bay Area rents fell through the early months of the COVID-19 pandemic, one group benefited less than others — low-income tenants.

The cost of older, cheaper apartments, usually rented by low-wage workers and others on fixed government incomes, dropped far less than newer properties. And in Alameda County, rents for low-cost apartments by May had risen rose above pre-pandemic levels

An analysis of Bay Area apartment prices found any savings gained by moving into an older complex has evaporated in the East Bay, even as luxury properties continue to entice professionals with months of rent-free discounts.

“It’s becoming difficult to keep up,” said Lorena Plancarte, a housekeeper and San Jose resident fighting a rent increase. “As beautiful as it is to live here, I don’t know what the future will bring.”

The economic impact of the resurging COVID-19 pandemic has struck low-income residents harder, and the fiscal pain has been most acute in housing costs, economists and advocates say. Nonprofit advocates have been vigilantly challenging landlords over pandemic tenant protections and bans on certain rent hikes.

Adam Couch, market analyst for real estate services firm RealPage, said increased demand for affordable apartments has driven up the prices of older units. Young workers living with their families have returned to the hunt for apartments and roommates as pandemic restrictions lift. Families struggling with lost income have also sought cheaper housing, adding to the competition for lower-cost apartments.

“There’s demand, really, across the board,” Couch said. Rents began to rise early this year as pandemic restrictions eased and workers returned to cities. “Demand has showed up in a huge way.”

Apartments are generally categorized by classes according to cost: Class A consists of the top 20% most expensive units; Class B encompasses 60% of the less expensive units in the middle of the market, and Class C are units in the lowest 20% available.

Class A properties typically are new or extensively renovated, offering amenities such as large common areas, gyms, pools and modern security. Luxury prices in Bay Area metros range from $3,550 in San Francisco to $3,140 in San Jose to $2,750 in Oakland. Class B and C properties are usually older and offer fewer amenities, with Bay Area prices ranging from $1,950 to $2,235 a month in the lowest category.

The cheapest apartments in the Bay Area had the smallest price declines of any sector between March 2020 and June 2021. In Oakland, Hayward and Berkeley, low-end rents actually increased about 1 percent during the pandemic. Meanwhile, prices for Class B apartments in San Francisco and San Mateo County fell 14%, the biggest discount in the region. At the top of the rental market, the cost of a luxury apartment dropped 12% in Santa Clara County, about 14% in San Francisco and San Mateo County, and nearly 11% in Alameda County, according to RealPage data.

Professionals able to work remotely escaped largely unscathed in the pandemic economy. But workers in the service industry and in other hourly-wage jobs that cannot be done remotely have seen their incomes fall and dipped into savings or tapped family members to make rent.

The Bay Area unemployment rate in June dropped to 5.4%, declining slightly from the prior month but still twice the pre-pandemic levels. Workers in the hospitality and leisure, retail, manufacturing, transportation and warehouse sectors have been among the slowest to recover their jobs, according to an analysis by the Bay Area Council Economic Institute.

The results have shown up in the flood of applications to state and local rental assistance programs. Nonprofit attorneys have stepped into rental disputes to assert new protections for tenants in rent controlled apartments in some cities.

Emergency price gouging protections in California generally prohibit landlords from increasing rent during the pandemic by more than 10%. Bay Area cities have enacted additional tenant protections.

Plancarte, 45, and her family have lived in the same two bedroom, rent-controlled apartment in San Jose for 17 years. She has asked her landlord to fix her kitchen and windows for years, and the property owner finally did the repairs early this year, she said through a translator. Her long-time landlord raised the rent from $1,700 to $1,850 after the work — a surprise to Plancarte and an unexpected new cost.

The Law Foundation of Silicon Valley argued that the increase violates San Jose’s emergency ban on hikes for renters impacted by COVID-19.

Plancarte and her husband, a handyman, have lost work during the health crisis, and cut back on buying groceries so they could pay rent. The entire family, including Plancarte’s three children, caught and suffered through the virus last fall. But, she said, she and her husband have started to find more opportunities for work and “things are starting to look up.”

Instead of finding pandemic discounts, working-class families, punished for years by the region’s high housing costs, are seeing apartment prices climb beyond their budgets.

Kimberly Linares, 55, has struggled to make rent on her disability check and the modest income from her two sons’ part-time work. When her landlord told her rent would increase $200 a month to $1,700, Linares contacted the Law Foundation.  Advocates successfully argued to have the rent increase reduced and are helping Linares and her landlord apply for rental assistance.

Linares considered moving, but knew from the experiences of friends and family another apartment would likely be more expensive.  “I know I wouldn’t be able to afford it,” Linares said through an interpreter. “It’s not an easy thing to live here.”

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Article source: https://www.mercurynews.com/2021/08/02/covid-19-rents-plummeted-but-not-for-everyone

We can now reveal that the house sold for exactly $1,000,000.

Some readers speculated that the seemingly high price was due to the 0.32 acres of land in the East Bay’s pricey 94598 ZIP code — that includes Walnut Creek and Mount Diablo — where the median house price is $1,375,000.

But Byrne told SFGATE on Thursday that she assumes the buyers will renovate what’s left of the home, as extra permits for a tear-down may be expensive. 

The home at 254 Tamarisk Drive was almost destroyed by the fire on Sept. 11 last year. The roof collapsed and the garage was reportedly fully engulfed in flames. Firefighters determined that the blaze appeared to have started in the garage, though a cause wasn’t revealed. 

“Bare bones opportunity to renovate/rebuild/restore. Extensive damage from a fire has this house stripped to the studs on both floors. This one is ready to start fresh and build to suit your style preferences,” the listing blurb read. 

“Opportunities like this are rare to make dramatic changes to a home and floor plan … this is more than a fixer and the potential is limited only by imagination.”

It’s now official, in the Bay Area, $1 million gets you the burned down remains of a four-bedroom house. 

Despite record-level Bay Area home prices, high-end incomes have grown faster than housing costs in parts of the region, suggesting for some a previously unthinkable description of the home market: “Affordable.”

Single-family home expenses — mortgage, insurance and taxes — took up less of the average annual local wage in most of the Bay Area in recent months, according to an analysis by real estate analytics firm Attom. The survey of wages and home prices found Bay Area houses more affordable in all but Contra Costa, Solano and Napa counties.

Although the Bay Area remains among the most expensive regions in the world, Attom CTO Todd Teta said local wages have risen between 10% and 21% during the last year, while median home price gains have topped out at 9%, and in some cases — like San Francisco — have fallen for the first time in years.

“There are signs in parts of the region that things are looking up for buyers, with major expenses on single-family homes taking up less of the average local wage in the second quarter of 2021 than in the same period a year ago,” Teta wrote. “That contrasts notably with the rest of California and other upscale parts of the country.”

Although the analysis is promising for highly paid and steadily employed home buyers, it doesn’t tell the entire story, brokers and economists say. Strong stock market returns and stable remote work lifted incomes for tech professionals across the region. But the federal wage data used by the real estate company does not factor in unemployed workers — many coming from lower-paid service-industry jobs. The regional jobless rate was 5.45% in May, twice pre-pandemic levels.

Bay Area Council economist Jeff Bellisario said high housing costs are still driving people and families out of the region and making it harder for companies to attract talented workers. For many workers, it presents a difficult choice, he said.

“It becomes a question of whether you become a renter forever,” Bellisario said. “Home prices create all of the challenges in our economy.”

The Attom quarterly analysis of federal data showed the average annual income needed to buy a Bay Area home — and still have money left for living expenses — ranged from $93,000 in Solano County to $246,000 in San Mateo County.  Average wages in the region range from $63,700 to $162,700. The median monthly cost of a Bay Area home still takes up far more than the 28% of income recommended for home purchases.

The region is home to the four most expensive counties — Santa Clara, San Mateo, San Francisco and Marin — in the U.S. Median home values in these Bay Area counties are between $1.3 and $1.4 million, according to Attom.

“Without a doubt, most people earning average local wages are priced out of the house-and-condominium market throughout the Bay Area,” Teta said.

There are signs of hope for buyers. Inventory in the San Jose metro and San Francisco and the East Bay inched up in May, giving shoppers more choices now and possibly slowing future price increases. Different parts of the region saw between 2% and 3% more homes for sale in June than May, according to Zillow.

Bay Area buyers have shown they are willing and able to run prices up to record levels. Median home prices have hit $1 million, and desirable Silicon Valley properties have drawn bidding wars that drive prices hundreds of thousands of dollars over listings.

Santa Clara agent Alan Wang works with many tech couples looking in Santa Clara and San Mateo counties. He doesn’t see homes becoming more affordable for most residents. But for well-heeled professionals, he said, “it feels like they have gold bars in $100,000 increments” to drive bidding wars.

“The single-family home sector is insane,” Wang said. “I don’t see how it’s affordable.”

In the East Bay, Pleasanton agent Tina Hand said buyers are still stretching budgets to land a house. Some recent buyers have backed out of deals, and others have just left the market in frustration, she said.

“For first-time buyers, it’s still tough,” Hand said. More homes have been going up for sale this month, she said. Prices do not rise forever.

“There has to be some sort of correction,” she said. “It’s not sustainable.”

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Article source: https://www.mercurynews.com/2021/07/24/have-bay-area-homes-become-more-affordable

“The market is kind of normalizing after having been just so imbalanced for such a long time,” said Jordan Levine, the association’s vice president and chief economist. “We do expect that the pace of home sales and the price of home sales will moderate.”

The median cost of a single-family home in the Bay Area dipped 3.6% in July compared to the previous month, the report found, and prices declined or plateaued in all but two of the region’s nine counties. The number of homes sold last month compared to June dropped significantly in several counties, including a 26% decline in Napa County and a 21% dip in San Francisco.

The biggest regional price drop in July was a 7.7% decrease in Sonoma County, to a median $761,700 sale price, followed by a 7.3% dip in San Mateo County to $2.1 million. Prices dropped 5% in San Francisco, to a median $1.9 million, and stayed flat in Alameda County at $1.3 million.

Still, all price changes are relative in one of the world’s most expensive housing markets. July’s Bay Area home prices were still 24% higher than the same time last summer. And while the pandemic changed the dynamic in many local housing markets, California home prices have long been boosted by more systemic factors like restrictive zoning laws, uneven property taxes and a consistent lack of new housing.

Linda Ngo has seen how these cycles play out before. The Coldwell Banker real estate consultant grew up in Marin and found herself at the center of the exodus from San Francisco last year, when Millennials and other clients were moving out of the city and into homes with offices and outdoor space in Oakland, Marin, Livermore and beyond.

In the last few months, she’s seen another shift. Where homes in Marin were regularly going for 15% or more over the asking price as recently as this spring, many are now going for more like 5% over. It was rare a few months ago to see houses last more than about a week on the market, but some are now available for 20 days or more.

“I am seeing that demand soften a little bit,” Ngo said. “Now that companies are talking about having their employees come back to the office part time, people are realizing that maybe they do need to go back to the city.”

Across California, demand for houses continues to outpace the supply of homes for sale, with 70% of homes sold last month going above the asking price, the California Association of Realtors report found. Another recent analysis by mortgage site HSH.com concluded that it takes an annual income of $254,532 in San Jose and $208,015 in San Francisco to afford the average mortgage — far more than the $129,444 needed in San Diego or $86,833 in Portland.

All the housing competition in recent months has also highlighted glaring inequities in the Bay Area market. Backlash to homeless encampments and concern about renter evictions are both hitting a boiling point as emergency pandemic programs wind down. Some people who already own homes have also spoken out about problems like potential racial bias in determining the value of a house.

One thing Levine will be gauging in the coming months is whether more homes go up for sale months, and if familiar seasonal buying patterns — busier in the summer, calmer in the winter — return after being derailed during pandemic shutdowns. One wild card, he said, is what may happen with the rise of the delta variant of the coronavirus.

“It seems like every time the public health numbers get worse, folks get more interested in housing,” he said. “Those suburban markets in particular start to punch above their weight.”

Ngo said she’s still seeing a “domino effect,” where former San Francisco dwellers move to houses in places like Oakland and help boost the prices there, in turn encouraging existing homeowners to sell and take the proceeds to more affordable places like the Sacramento area.

Lately, Ngo has also been seeing more interest from investors as ordinary home buyers grapple with fatigue from unfruitful searches. Some are just waiting to see what happens, hoping there’s still a bigger dip to come.

“A lot of people think there’s no way this market can keep going like this,” Ngo said. “But I think they’re wrong.”