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But in the Bay Area, $1 million homes are considered on the cheap side. According to Zillow, a typical single-family home in San Jose — the most expensive market in the country — was valued at over $1.5 million in July, and homes costing $1 million or more are the norm in the San Jose area, constituting 72% of the market.

In San Francisco, the second-most-expensive market, the typical home value was $1.46 million and $1 million-plus homes accounted for 62% of the market.

So, it stands to reason that buyers with $1 million to spend in the Bay Area are getting the least square footage, said Matt Kreamer, a data spokesman for Zillow.

“Just like toilet paper rolls and candy bars, houses have experienced ‘shrinkflation,’” he wrote in an email. “As the price of homes has skyrocketed over the past couple years, you just don’t get as much for your money as you used to.”

Among the 42 largest U.S. markets examined, the San Jose metropolitan area, which consists of Santa Clara and San Benito counties, had the lowest median square footage of 1,399 for a $1 million home for the quarter ending in April 2022, according to Zillow. The San Francisco metro, which also includes Alameda, Contra Costa, Marin and San Mateo counties, followed at No. 41, with a median square footage of 1,636.

That compares to New York, at No. 37 with 2,500 square feet, Sacramento at No. 34 with 2,541 square feet, and Chicago in the middle at No. 21 with 3,375 square feet.

In Dallas, at No. 10, $1 million will buy 3,818 square feet, and in No. 1 Hartford, Conn., it will buy a very roomy 4,873 square feet.

“The higher homes cost in general, the less you can get for your money,” Kreamer said. “Also, land is at a premium in the Bay Area, because of geography and population, so homes generally have smaller footprints than they do in areas where there is more room to build.”

In 2016, the typical home in the Bay Area cost $915,000, and $1 million would get a buyer nearly 2,000 square feet, Kreamer said.

“Now, the typical home costs nearly $1.5 million, and so the size of a house you can get for $1 million has shrunk to just over 1,600 square feet,” he said.

From the quarter ending in April 2020 to the same period ending in April 2022, the median square footage for a $1 million home decreased 84 square feet in San Francisco and 150 square feet in San Jose. The median square footage has dropped 20%, or 343 square feet, in the San Jose metro, and 17%, or 324 square feet, in the San Francisco metro since January 2016, when Zillow first started tracking the data.

“In much of the country, people picturing a $1 million home are thinking luxury,” Kreamer said. “It’s a big number, to be sure. But in the Bay Area, the typical home is already much more than that, so many home shoppers would be thrilled to find a home that meets their needs for just $1 million.”

With million-dollar-plus homes already constituting the majority of the Bay Area market, Kreamer noted that the decrease in square footage for $1 million homes there since 2020 was relatively small compared with other metro areas such as Seattle, with a decline of 421 square feet since April 2020, Los Angeles, with a drop of 544 square feet, and Indianapolis and Jacksonville, each with a whopping 1,000-square-foot drop.

The U.S. median square footage for a $1 million home declined 397 square feet, or 13%, since April 2020.

“The prices in the Bay Area might make an analysis like this a little less relevant, but it sure brings into context just how expensive it is there compared with most of the country,” Kreamer added.

A comparison of what $1 million homes look like helps illustrate the Bay Area’s reality as well: San Jose sets the floor for the U.S., at three bedrooms, two bathrooms and just under 1,400 square feet. At the other end of the spectrum is Hartford, where $1 million buys more than three times as much: four bedrooms and four bathrooms in 4,873 square feet.

The price per square foot for a $1 million home in the Bay Area has steadily increased over the years. In the San Jose metro, it’s gone up 25%, or $141, since January 2016, and 11%, or $69, since April 2020. In the San Francisco metro, the price per square foot increased 20%, or $101, since January 2016, and 5% or $30 since April 2020.

The housing crisis is an issue across the country, but it’s especially acute in the Bay Area, Kreamer said, with its severe supply shortage compounded by strict rules on building.

“The fewer homes there are, the more they cost as a growing number of people compete for them,” he said. “We’re in an affordability crisis that we need to build our way out of, and a good first step is eliminating roadblocks to construction.”

Kreamer said it’s fair to say that the situation is becoming “increasingly unsustainable.”

“At some point – and it seems like that’s happening now as interest rates have risen this year — we’ll hit an affordability ceiling, where people just won’t be able to afford to buy homes and the market will have to rebalance,” he said.

As interest rates have increased in recent months, inventory has been increasing, price growth is slowing and homes are staying on the market longer, which could bring things “closer to normal,” Kreamer said.

Kellie Hwang is a San Francisco Chronicle staff writer. Email: kellie.hwang@sfchronicle.com Twitter: @KellieHwang

In recent months, Stuff owners Will Lenker and James Spinello said they have been trying to negotiate with the new property owner, Aralon Properties, which bought the building in 2015. The couple is nearing the end of their existing 12-year lease, which runs out in 2024, Spinello said.

“It’s felt very personal to try to keep this going for” the vendors, said Spinello, referring to the 60 vendors who support themselves through their sales at the store. “This is their livelihood.”

After the building’s previous owner passed away, the property was listed at $6.1 million, according to broker advertisements, where it was described as an “excellent investment opportunity” that also held the opportunity for redevelopment and expansion along the “bustling Valencia Street Retail Corridor.”

The Chronicle was unable to reach Thomas Murphy, president of Aralon Properties, which purchased the property. Aralon Properties is a private real estate company in San Francisco that develops and manages commercial real estate, according to its website.

Over the past few months, Lenker and Spinello were under the impression that Aralon Properties was interested in either selling the building to the couple or renting to them after the lease expired. Aralon already has spiked their rent from $20,000 a month to $25,000 a month, Spinello said.

But in the past week, Spinello said he was given two options: Either pay $10 million to buy the building, or pay $75,000 a month in rent, which would come out to $900,000 a year.

Those scenarios will likely make it impossible for Stuff to remain open, Spinello said.

“This is bohemian San Francisco,” said Stuff manager Marty Scibilia, 58, who has been there ever since Lenker hired him on the spot not long after the shop opened. “We have everything from $5 records to a $50,000 vase. To encompass all of that in the word ‘stuff’, was I thought, brilliant.”

When the space first opened, it “literally sucked the air out of every room,” said Judith Thorn, 78, one of the vendors who has been with Stuff the longest and is also the mother of famed podcaster Jesse Thorn. “There was so much power and beauty in one place that a lot of shops closed.”

Judith Thorn, a scholar of hip-hop who previously taught at Santa Rosa Junior College but has struggled to make a living her whole life, said the loss of Stuff is far more than just income — it’s a reality she can’t even imagine.

“I’ve never seen anything like it in America,” she said. “Stuff has hip things, as opposed to stuff that your grandma discarded. If this goes, the city is going down the tube.”

It would be a loss for the long-timers, too, employees say: the customers who come in every day, and the expansive network of collectors and aficionados who make a trip to Stuff a regular part of their lives.

Over the years, actress Jennifer Coolidge, personalities from the Mythbusters, Metallica, Chris Isaac and others have made trips to the store, said Scibilia, who added that Coolidge’s purchases have included ‘creepy dolls’ that she gives out as party favors at her annual Halloween party.

“Will and James set it up with this idea that it was going to be this destination,” said Scibilia, describing the red carpets, the familial feeling, and the upbeat music that’s always ringing through the space. “We all did not want a dusty, dirty antique store.”

Located 45 miles east of San Francisco, the city of Pleasanton has become a high-end hub of the East Bay, and according to Niche, has about 80,000 residents. What makes this town great is that Pleasanton offers all the convenience and accessibility of a small city, yet still is a majority suburban neighborhood. With a Bay Area Rapid Transit station, it’s easy to commute to all corners of the Bay Area, including San Francisco, Oakland, and San Jose. It is also home to a charming and historic downtown district with over 550 diverse businesses including restaurants, bars, boutiques, coffee shops, galleries, and a variety of other local gems, according to Pleasanton Downtown Association.

Pleasanton is nationally recognized and has been ranked on a variety of lists including 24/7 Wall Street’s “America’s 50 Best Cities to Live” and Money Magazine’s “Best Places to Live” (via City of Pleasanton). With all that Pleasanton has to offer in terms of outdoor space, public education, and a busting downtown district, along with its continued growth, owning a home in the city provides significant value. The median home sale price is around $1.6 million, making purchasing a home in Pleasanton slightly cheaper than many other distinguished Bay Area suburbs (via Redfin).

Article source: https://www.housedigest.com/979118/the-best-neighborhoods-in-the-bay-area-to-buy-a-home/

108 Caine Ave.

Neighborhood: Ingleside

Sold for: $960,000

Listed as a four bedroom, one bathroom, this single-family home was described as an “absolute bargain” in the listing. There are no photos and not much more in the description aside from the fact that the garage has 8-foot ceilings, so it’s unclear if it was the bargain it was advertised to be. Originally listed for $799,998 in 2021, before a price drop to $749,998 later in the year, it eventually sold for 28% over asking.

View the full listing here.

1619 Quint St.

Neighborhood: Silver Terrace

Sold for: $930,000

This classic two-story home has three bedrooms and one bathroom with an updated interior and a double garage. The kitchen has been renovated, and there’s lots of potential in the backyard space. Still, it ended up selling for nearly 7% below the asking price.

View the full listing here.

72 Argonaut Ave.

Neighborhood: Visitacion Valley

Sold for: $900,000

This home looks basically brand new — you’ll just have to ignore the bars covering every door and window. It has new floors, granite countertops and even a small patio. Four bedrooms, three bathrooms and over 1,700 square feet in this city for under $1 million? Seems like a downright steal.

View the full listing here.

276 Ellsworth St.

Neighborhood: Bernal Heights

Sold for: $878,000

This is a killer Bernal Heights location, and this “fabulous fixer” sold quickly for its “good bones.” No photos were available, but those bones apparently include two bedrooms and one bathroom upstairs, and a lower level that includes a 310-square-foot studio with a kitchenette, full bathroom and separate entry.

View the full listing here.

14 Ina Court

Neighborhood: Excelsior

Sold for: $860,000

This one is a “contractor’s special” right on McLaren Park. It has three bedrooms and one bathroom, in addition to a “full basement with a room downstairs that is not warranted by broker or sellers.” The listing says that on a clear day, you even have panoramic views to downtown and a view of the Bay Bridge. This is another rare, sold-for-under-asking property. Maybe the market really is cooling?

View the full listing here.

109 Blanken Ave.

Neighborhood: Visitacion Valley

Sold for: $775,000

Another “fixer opportunity,” this time featuring two bedrooms, one bathroom and an “unwarranted room in the garage which has potential for a small inlaw.” This listing suggests there’s plenty of work ahead for the city’s contractors.

View the full listing here.

132 Prospect Ave.

Neighborhood: Bernal Heights

Sold for: $699,000

This one-bedroom, one-bath cottage can only be called adorable. It’s tiny, but it has an open-floor plan, skylights and every inch of space is used for efficiency. There’s even a cute little patio off the bedroom.

View the full listing here.

1370 Quesada Ave.

Neighborhood: Bayview

Sold for: $600,000

This single-family was listed as a four bedroom, two bathroom, but it’s “looking for some TLC.” No photos were available, but the listing said rooms are large and there’s even a bonus room downstairs. You may not get many “move-in”-ready homes under $1 million, but you’ll get … something.

View the full listing here.

Article source: https://www.sfgate.com/realestate/article/homes-sold-for-under-1-million-sf-17414009.php

Two downtown San Francisco office buildings that were put up for sale last spring have been yanked from the market after bids came in far below the sellers’ most pessimistic projections, according to commercial real estate brokers familiar with the deals.

In June, Wells Fargo, San Francisco’s second largest private employer, listed its 13-story building at 550 California St. for $160 million, about $450 a square foot. While the guidance price was a good 25% below what the 355,000 square-foot building would have fetched before the pandemic, the bids submitted were much lower — about $250 a square foot, which is about 45% below expectations. That’s 70% below likely 2019 values.

Wells Fargo declined to comment.

Meanwhile, a few blocks away, on the south side of Market Street, UBS Realty Investors sought a buyer for 455 Market St., a 374,000 square-foot complex that is 80% leased. While the seller sought close to $280 million, or $750 a square foot — pre-pandemic values would have been $900 a square foot — bids received were closer to $500 a square foot, about $187 million.

Ken Rosen, chairman of the Berkeley Haas Fisher Center for Real Estate and Urban Economics, said the two broken deals are an indication that “San Francisco has a very big problem.”

“At the moment San Francisco is not a market investors want to be in,” said Rosen. “People are not feeling good about buying San Francisco office buildings.”

While San Francisco’s residential rents have bounced off of pandemic lows, the office sector is struggling with 24% vacancy rate, according to the brokerage CBRE. Rents have declined from $83 a square foot pre-pandemic to $75 a square foot today.

Colin Yasukochi, research director at CBRE, said there are too many uncertainties to make investors comfortable with committing to transactions.

“Price discovery is still in the early stages, in terms of where rents may be headed and where office occupancy is headed,” said Yasukochi. “As long as those two important variables are unknown it’s going to be hard for investors to establish value, and if forced to, most buyers will undervalue an asset.”

The office building sales market is stuck in a bit of a pickle: Buyers and sellers are unable to come to terms because of a lack of solid comps, but there will not be reliable comps until a few properties are sold, according to attorney Tony Natsis, chair of Allen Matkins’ Global Real Estate Group.

“We don’t have a dip, we have a complete standstill,” said Natsis, who represents some of the biggest office landlords and developers in California. “There is a classic disconnect between buyers and sellers about what those buildings are worth. The problem is that there are not enough data points to force the buyer or the seller to admit their number is wrong.”

Natsis said he expects the picture to become clearer this fall as more companies settle on work-from-home policies.

“All it’s going to take is the stock market stabilizing, inflation to stabilize and companies to mean it when they say ‘You’ve got to come back to work,’ ” he said. “Even if you don’t like the answers you can then price an asset.”

J.D. Lumpkin, executive managing director with Cushman Wakefield, said perspective buyers of the 550 California building saw it as a “complete gut.” He compared it to 680 Folsom Street, a former phone company building that TMG Partners completely redeveloped during the Great Recession, adding a new glass curtainwall exterior and all new systems and interiors. But while that building was quickly leased out to Macys and Riverbed Technology in 2012, tenant demand today is less of a sure thing.

“It takes a lot of courage to do something like that,” said Lumpkin. “And as of now there is not a solid demand thesis — you can’t look at a deal and say, ‘I have a pretty good idea of who is going to lease that.’ ”

Lumpkin said several investors looked at the Wells Fargo building as a residential development site, but the mid-block location — hemmed in by office buildings on both sides — make that a challenge as well. In the end, offers in the $200 per square foot were similar to what an investor would pay per buildable square foot for land prior to the pandemic.

“Basically, (bidders) were attributing no value whatsoever to the structure itself,” he said.

The decline in the value of downtown office buildings will have long-term implications for the city’s tax base, as building owners petition for reassessments. A recent Chronicle analysis found that sales tax revenues in District Six — which includes Financial District, Oracle Park and SFMOMA down to Mission Bay — have declined from $28.3 million in 2019 to $17 million in 2021.

Already property owners have started petitioning the assessment appeals board to have their property values adjusted downward. The owner of 301 Battery St. is looking to have its assessment adjusted from $154 million to $101 million. That cases, along with eight others, will be heard in September. The owners of 222 Second St., currently assessed at $535 million, had filed an appeal arguing that the tower is worth $267 million. That appeal has been withdrawn, according to building owner Tishman Speyer.

Beyond the work from home trend sending less people into office spaces, the city’s central business district is suffering from a lack of conventions, empty storefronts, homeless encampments and open air drug dealing, Rosen said. He said the city’s budget would likely take a major hit as more and more property owners have their assessments lowered to reflect the new realities.

“It will be a wake-up call,” he said. “We are losing our economic base and that will continue until we change our politics in San Francisco. We have a crisis in business confidence.”