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Spring home-buying season in the Bay Area exploded in April, with brisk sales and prices topping $1 million for the second straight month.

The median price for an existing single-family home in the nine-county region reached $1.15 million in April, driven by tight supply and intense demand for suburban space. The price marks a 12% increase from March, signaling a favorable trend for home sellers but more costly bidding wars for buyers, according to CoreLogic and DQNews data.

Still, economists and agents say the frothy market isn’t a bubble — just a reflection of the Bay Area’s economic strength, home buyer demand and too few available homes.

CoreLogic deputy chief economist Selma Hepp said pent-up pandemic demand is driving prices. “It’s traditional buyers, not speculators,” Hepp said. “When you think ‘bubble,’ you think some speculation is going on. But it’s not speculation.”

An analysis of FHA loans by housing researchers at the American Enterprise Institute of Bay Area properties — especially in San Francisco, Santa Clara and San Mateo counties — supports Hepp’s point. It found the Bay Area had the lowest loan delinquency rates in the U.S. last  April.

The research suggests property owners with government-backed loans are making mortgage payments in the Bay Area, unlike the rising loan defaults that led to the housing crash of 2007.

Prices are leaping in once relatively affordable East Bay communities, while Silicon Valley techies are bidding $100,000-plus over list prices to buy into Peninsula cities. Low interest rates, hovering around 3% for a standard mortgage, have allowed buyers to expand their budgets.

The burst in Bay Area home prices was led by Contra Costa County, up nearly 25% from the previous year to $972,000, Alameda County, up 17% to $1.18 million, and Santa Clara County, up 11.5% to $1.52 million, according to CoreLogic data. The year-over-year median price rose 8.5% in San Mateo County to $1.75 million and climbed 2.9% in San Francisco to $1.79 million.

The median prices grew 28% from April 2020 — a low water mark for real estate, with few sales closing in the initial lockdown of COVID-19 restrictions.

Sales of all homes, including condos and new and existing houses, rose 15% from March to April. The number of transactions more than doubled from the previous April.

Hepp said some of the intense demand is driven by buyers’ fear: “I won’t be able to get in unless I get in now.”

Agents and real estate professionals say the market has accelerated to peak levels last seen in 2018. Desirable homes are drawing multiple offers the day they hit the market.

In  Alameda and Contra Costa counties, the average number of days on the market dropped from 25 to 13 between January and May. “The price increases in the East Bay are breathtaking,” said David Stark of the Bay East Realtors Association.

Michelle Ronco of MLSListings said home inventory has started to increase but not enough to keep up with demand. In Cupertino and Saratoga, for example, homes are being listed and sold the same day. “What’s coming on is coming right off,” Ronco said. “It’s just basic supply and demand.”

The common Silicon Valley trend of homes selling for a premium above their listing prices has spread to Santa Cruz and Monterey counties, as well as Hollister, she said. Those regions have all hit record home prices in recent months, according to MLSListings data.

Cupertino agent Ramesh Rao said professional couples continue to bid up single-family homes near tech offices on the Peninsula. He cautions clients they may need to bring more money to clinch a deal, as prices have sometimes jumped $250,000 or more over listings.

One of Rao’s clients, a tech couple in their 30s, came into their search with an initial budget of $1.3 million for a single-family home with a nice yard in San Jose. They were told to expect to stretch their finances — and eventually won a bidding war with a $1.75 million offer for a spacious 4-bedroom with a collection of fruit trees in the back yard.

Rao said demand for space remains strong even as pandemic restrictions have loosened. “Which buyer ever said, ‘I want a small house?’ “They always want a bigger house,” he said.

The market has been a challenge for many buyers, said Pleasanton agent Tina Hand. She’s had to help clients adjust to the fast pace and inflation in the East Bay. “A list price is just a number. The appraisal price is really just a number,” Hand counsels new buyers. “What are you really willing to pay?”

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Article source: https://www.mercurynews.com/2021/06/05/bay-area-home-prices-top-1-million-in-april

About 20 years later, Pourshams is working as a physician at Stanford University, and he remembers well how he’d drive home from Davis every weekend, where he’d help his father with his real estate business, work on his grueling pre-med homework, then drive back to campus. 

At 18, while pursuing medicine in his undergraduate studies, he received his real estate license, which he studied for between classes in high school (“I finished my finals at Davis, then went to Oakland and took my real estate exam.”) He went onto medical school at Ross University in the Caribbean, where he put his real estate career on hold.

“I paid for college [as a realtor], then I paid my way through the first year of medical school,” he said. He next joined a program that will pay off his remaining student debt after he works for 10 years in public health.

We in the Bay Area are all too familiar with side gigs. But Pourshams’ moonlighting as a realtor-broker is unusual, even for this expensive region. But the physician seems to enjoy the constant switching. Currently, he works four-and-a-half days a week at Stanford as a post-doc researcher. He does real estate in his “free time.”

Pourshams keeps two cell phones — one for medicine and his personal life, and one for real estate. Each has a different ring tone and text chime, so before even looking at his phones, he knows which hat to wear. During breaks on his rounds or in his research, he’ll respond to inquiries, check on the status of a sale or post a listing. 

“I think I’ve always been good at compartmentalizing,” he said. “I grew up doing martial arts, so my mental fortitude comes from that training. They used to push us hard and say, ‘It’s all in your mind, you can control it.’” 

The key, he says, is completely disengaging from one task to focus on the other. 

When I asked which profession made him the most money — medicine or real estate — Pourshams didn’t hesitate.

“I make more money as a realtor,” he said. “It’s hilarious, I know.” 

With that comes a drive to give back to his region. He started a nonprofit called Mina’s Wellness, focused on helping children learn to make good health decisions. And he recognizes the insidiousness of the cycle of debt and renter-dom. 

“It’s like, you need an education in order to get a job. But then you have all this debt, so you need a home so you’re not constantly paying a landlord,” he said.

He knows the cycle himself. Pourshams says he still has nearly half-a-million in debt from medical school. At 37, he’s just now starting to look at buying a house, but he’s priced out of the town where his family lives (Los Gatos).

In 2018, Pourshams founded his own real estate company, called TuuKasa. His dad handles most of the day-to-day and operates the company under Pourshams’ broker license. “Real estate,” he affirms with a laugh, “is essentially a hobby.”

And he’s quick to acknowledge his privilege in all of this. He says he would never have gotten into real estate if it weren’t for his familial ties. He finds much of the industry altogether unsavory. And he can’t believe the rates most Bay Area realtors charge — about 5% per sale, he says. Pourshams charges about 2% by comparison. 

Pourshams discusses this region’s housing situation with a jaded clarity. He says he “hates” realtors who drive Lamborghinis just for the image. He loathes the “Trump mentality” that some of his peers have. 

“I know realtors considered the best of the best that don’t pay their stagers. They have debt toward them, which they never pay back.” 

“For example, when these people close a deal, they tell a roofer, I’ll pay you when escrow closes,” he adds. “They don’t pay them. It’s like, you’ll have to come after me if you want your money.” 

Pourshams has even more pursuits on the horizon. He eventually wants to open a health clinic-gym, where he can teach his patients exercises firsthand. Pourshams, naturally, used to work as a personal trainer. 

In the meantime, he’s pursuing his “smaller” goals. He’s been studying law under his neighbor “as a hobby.” In the fall, he plans to take the California Bar Examination. 

“It’s not because I want to practice law or anything, I just see it as an interesting challenge,” he said. 

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SAN FRANCISCO, Calif. (KRON) – Is “pandemic pricing” behind us?

San Francisco real estate consistently made headlines throughout the pandemic. But since January, San Francisco rents have increased by over 17%, according to a national report from Apartment List.

For the month of June, rent prices in San Francisco went up 2.7%. This is the fifth straight month that the city has seen increases in rent.

Currently, the median 1-bedroom price in San Francisco is listed for $2,329 and 2-bedrooms are listed for  $2,695. Consistent increase in rental prices may have you questioning: should you rent or buy?

According to Compass Chief Market Analyst Patrick Carlisle, the SF housing market softened in the first 5-6 months after the pandemic struck, but then it heated back up.

Value for condos typically runs higher than that for houses. However, condo values are well below their peak, while house values have hit new highs, according to the Compass report.

Additionally, higher demand means a greater percentage of listings sell and sell more quickly.

There’s been a “rebound in overbidding.” The higher the percentage of sales closing over listing price, the higher the buyer demand. And the percentage of sales over original listing price in San Francisco is up 77%.

Zillow economist Nancy Wu says that inventory in the Bay Area is up 6% and up 25.6% from last year.

Wu says the fact that more properties are hitting the market now could be a good thing for buyers who have been frustrated by constantly being outbid by other people who are willing to go far above the asking price and pay with cash.

Article source: https://www.kron4.com/news/real-estate/rent-keeps-going-up-in-san-francisco/

Article source: https://www.sfgate.com/local/article/Bay-Area-man-makes-more-money-as-a-realtor-than-a-16265596.php

SAN FRANCISCO (KGO) — It’s not just homes that are flying off the market in San Francisco. The rental market is heating back up as dozens of major companies return to the office this week.

From eerie ghost town to a bustling city bouncing back.

“This time last year it was a ghost town,” said real estate agent Neil Canlas. “You could see the tumbleweeds on the streets of San Francisco.”

RELATED: San Francisco turned ghost town? Here’s how empty the city really is

But, this year the city is starting to come back alive again – one indicator being the rental market.

“During the Pandemic, rentals were sitting on the market for a long time. At least a month or two, now they’re going off in a week or two,” said Canlas.

Canlas says in July last year only 25 rental listings closed on the MLS. Whereas, in just the past three months 188 rental listings closed.

“People are coming back and they need a place to live,” he said.

VIDEO: Golden State’s real estate market among hottest on record

With people back, the prices are coming back too. The Canlas brothers say overall average rent for a two bedroom, two bath has increased up to 20 percent. But, that all varies on location. ABC7′s data analysis of closed MLS rental listings from the second quarter of this year show the biggest rent spikes were for condos in Mission Bay, South Beach, the Financial District, and parts of Polk Gulch.

Stephanie: “What’s the average rental rate for a two bedroom in Polk Gulch right now?”

Daryll Canlas: “The average is anywhere between $2,500 to $3,000.”

Stephanie: “What was it two quarters ago?”

Daryll Canlas: “Around 10 to 20 percent off, probably looking at $2,000 to $2,800.”
The heightened demand also impacting the city’s commercial real estate.

“People are moving back to the city,” said Robert Sammons, a senior researcher for commercial real estate firm Cushman and Wakefield. “It’s a great sign for our economy.”

RELATED: The Bay Area county where pandemic home sales skyrocketed

“We are closing out the second quarter today and we will finish out with 7,000 sq. ft. of new leasing activity,” Sammons said. “That is the best since the first quarter of 2020.”

Signs of progress, but there’s still work to do. 20 percent of the city’s commercial buildings are vacant – the highest figure reported in the last two decades.

“It’s going to take time, maybe 2022 until we fully recover,” said Sammons. “But, we’re making progress and that’s a great sign.”

According to data compiled from Cushman and Wakefield, of the 140 major companies the firm tracks that are mostly based in San Francisco, 70 percent indicated they will have returned to the office in some capacity by July 1. That figure is expected to jump to 78 percent by the end of the year. Whereas, 22 percent of that group indicated they will be working from home indefinitely.

Article source: https://abc7news.com/san-francisco-real-estate-rentals-coronavirus/10848750/