[A version of this story was published in Bay Area Disrupted, The Chronicle's newsletter about the Bay Area's pandemic transformation. Sign up for the newsletter here.]
At the start of the month, around two dozen big ships were waiting in line to unload at the Port of Oakland, an “unprecedented” challenge that could delay everything from electronics to clothing to, yes, boba tea from reaching consumers. The port reported record-high container volume for both imports and exports in March, including a 45% surge compared to last year, as the pandemic was taking hold. The port expects the surge to last for months or more.
The ports of Los Angeles and Long Beach, the nation’s two busiest, are seeing similar traffic jams.
“The shortage isn’t just about boba, but the entire ecosystem that depends on overseas inventory,” said the owners of popular chain Boba Guys, which also runs a Hayward boba factory, on Instagram last week. “The point is, this is going to be very messy. And if it’s messy for us, it’ll be messy for small businesses across the country with much less infrastructure.”
They’re now considering a pause on selling their namesake boba across stores and urging customers to buy other toppings.
On one hand, this is a sign of an economic boom: Factories in Asia have come roaring back, and economists predict a robust U.S. recovery this year. (The International Monetary Fund predicts 6.4% GDP growth this year, compared to a 3.5% contraction last year.)
On the other, it’s a sign that the wounded regional and global economy may struggle to keep up, and old struggles persist. A major challenge for ports is a shortage of workers. As Bay Area restaurants reopen for indoor dining, they’re facing similar staffing challenges, which was already the case before the pandemic. Now it’s exacerbated by all the workers who have left the region or the industry.
Consumer demand, especially for online shopping, is also reshaping our cities. The East Bay industrial market — which includes the warehouses that store items unloaded from ships — has a tiny vacancy rate of 2.8% and new projects totaling 1.28 million square feet are under construction, according to real estate broker CBRE. Office vacancy rate is 10.2%. In San Francisco, Amazon is trying to build a last-mile delivery center on a site where housing was previously proposed.
How has the pandemic changed your shopping habits? As restrictions lift, do you plan to do more in-person shopping, or are your pandemic preferences becoming permanent? Have you noticed any shortage? Get in touch with me atroland.li@sfchronicle.com or on Twitter @rolandlisf.
(NEXSTAR) – The average home in Oakland, California costs about $866,000, according to Zillow, which is all the more reason that 7135 Pinehaven Rd. is getting attention.
The 25,000-sq.-ft. property costs only $575,000.
The property features a log cabin built in the 1890s that overlooks a sloping, tree-lined lot.
7135 Pinehaven Rd. in Oakland is for sale for $575,000. (Courtesy photo)
But there’s a catch: The cabin is currently uninhabitable. With some TLC, it’s possible it could be brought back to its 1890s grandeur, but in all likelihood, it’s a teardown.
“It’s a cool property, but not in great shape,” said listing agent Nick Flageollet. “The terrain is sliding out from under the foundation.”
7135 Pinehaven Rd. in Oakland is for sale for $575,000. (Courtesy photo)
But, Flageollet acknowledged, “It’s very unique. I don’t know if I’ve seen anything like this or even this old in this area.”
For someone with a knack for renovation, the property is promising. It sits in the Forestland neighborhood of Oakland, near bustling Rockridge, and is close to nature and hiking trails.
The Vallejo-Fairfield metro area was No.1 on the list in February and has been on the company’s top 20 list for the last several years. But during the pandemic, homes in that market have been selling at a particularly rapid pace.
In February, half of Vallejo homes sold under 14 days, 21 days faster than last year and 49 days quicker than the U.S. average. And while the median listing price increased 7.8% from February to March, it’s still much more affordable compared to its large Bay Area neighbors, San Francisco and San Jose.
Realtor.com takes into account market demand and pace of the market to determine an area’s “hotness.” That is determined by the number of unique viewers per property and the number of days a listing is active on Realtor.com’s website.
In the latest hottest housing markets report, California had six in the top 20, more than any other state. Nicolas Bedo, economic research analyst for Realtor.com, said California has always been a popular place to live since 2016, the furthest back the company’s data goes.
“Temperate climates and tech jobs have buoyed major California markets for a long time,” he said. “Tech hubs like San Francisco and San Jose have drawn substantial homebuyer demand over the years. However, as those markets became too expensive to sustain the demand, ‘spillover’ markets like Vallejo and Stockton have risen to take their place as homebuyer hot spots.”
He said California’s “continued and expanding economic growth” consistently produces up-and-coming markets that offer affordability compared to major cities, and the draw for cheaper markets has only escalated with declining mortgage rates that hit a historic low of 2.86% at the beginning of the year. But now they are starting to tick back up, reaching 2.99% in March, which is the highest rate since September 2020.
“The combination of rising prices and rising rates adds a ticking clock for buyers looking to stay within their budget,” he said. “This is especially true in California where higher-than-average home prices mean even bigger dollar swings in monthly payments as mortgage rates rise and fall.”
While affordability is still driving demand, median listing prices for the hottest markets were on average 18.9% higher than the national price in March. This may reflect a willingness of buyers to pursue pricier homes as they aim to lock in favorable mortgage rates, which are projected to keep climbing.
Other Northern California cities in the top 20 include Yuba City in Sutter County, which came in seventh place with a median listing price of $427,000. The Santa Cruz-Watsonville area was No. 8, with a median listing price of $1.2 million, and Stockton-Lodi followed at No. 9 with a median listing price of $468,000. The Modesto area came in at No. 12, with a median listing price of $499,000. And in the far northwest corner of the state, the Eureka-Arcata-Fortuna area came in at No. 18, with a median listing price of $439,000.
Here is the full list (the chart can also be seen here):
Kellie Hwang is a San Francisco Chronicle staff writer. Email: kellie.hwang@sfchronicle.com Twitter: @KellieHwang
Some ZIP codes in San Jose saw home values increase by more than 16%, but on the whole, the city’s property values increased by 14% compared with the same period last year, bringing its median home price to $1.2 million. San Francisco, on the other hand, saw a 3.2% decrease, bringing its median home price to $1.4 million.
We compare two homes — each right around their cities’ median price points — to see what the market looks like in both regions.
128 Noe Street, San Francisco
Michelle Kenyon, Compass
A three-bedroom Victorian that kept the old fixtures — but with a big remodel
Amenities: Outdoor patio, one parking spot, bonus room, laundry
128 Noe Street, San Francisco
Michelle Kenyon, Compass
128 Noe Street, San Francisco
Michelle Kenyon, Compass
This condo in the heart of Duboce Park is a true Victorian — it was built in 1887 — and owners over the years have retained many of the signature architectural details, including a stained glass box bay window, wainscoting throughout the house, pocket doors, and 12-foot ceilings with medallions.
But other parts of the home — the kitchen, the furnace, added closet spaces and more — have been totally remodeled.
128 Noe Street, San Francisco
Michelle Kenyon, Compass
“It gives you the best of both worlds,” said listing agent Cece Doricko of Compass.
The property has two levels: two bedrooms on the first floor, and a third bedroom on the lower ground level, which is advertised as a “flex work space” and also has a bathroom and laundry. The kitchen, which was recently remodeled and has a gas range, farmhouse sink, built-in desk, and chessboard kitchen tiling, leads directly to the outdoor patio space.
128 Noe Street, San Francisco
Michelle Kenyon, Compass
Doricko says she already has more than 20 interested parties and anticipates between five to 10 offers. The level of interest is one among many signs she’s been noticing in the past months that the market in San Francisco is coming back. Though there was a lag in the last year — which aligns with Chronicle data on home values — it’s picking back up in ways Doricko says she hasn’t seen in years.
“I’ve never had business like this in the first quarter, ever, it’s been phenomenal,” she said.
“Sellers are realizing that the market is good again, and they’re starting to get their homes ready,” Dorkio said. “Nobody wanted to take a loss last year, so now inventory is starting to pick up and buyers are out in droves. It’s like a light switch went off.”
The frenzy is everywhere in the city — she’s seen listings get up to 17 offers and close for nearly a million over asking. Houses in the Sunset District especially, she says, are highly desirable, with some getting more than 30 offers. “The COVID discount is just about gone,” she said.
128 Noe Street, San Francisco
Michelle Kenyon, Compass
At the $1.4 million price point, Doricko says she’s seeing a lot of young professionals — mostly in their late 20s or early 30s — interested in buying homes, some of them for the first time. With many companies in the Bay Area announcing hybrid work-from-home plans, more people, it seems, are considering San Francisco again for real estate.
Even as things appear to heat up in the city, there’s still plenty of demand to the south in San Jose, which has always been more affordable than San Francisco but also is now seeing a competitive market.
833 Raeburn Court, San Jose
OpenHouse365.org
A four-bedroom home with a lush backyard and private gazebo
Amenities: Large backyard, parking, patio, bonus room
833 Raeburn Court, San Jose
OpenHouse365.org
833 Raeburn Court, San Jose
OpenHouse365.org
This four-bedroom, three-bathroom house in San Jose’s desirable Pinehurst neighborhood couldn’t look more different than the Noe Street house. But for those looking to get out of the city and find a tranquil space in the suburbs, this property would likely fit the bill.
The house, built in 1977, has its own quirks, including a staircase in the middle of the open concept living area that leads up to the top floor’s upstairs bedrooms. The home has sliding patio doors that lead out to a large, well-maintained backyard with ample space for landscaping (the entire lot is 5,436 square feet) and even more space in the garage.
The home is convenient for a typical Bay Area commuter — it’s near the VTA light rail, Highways 87 and 85, and close to major tech companies like Apple, Netflix and PayPal.
833 Raeburn Court, San Jose
OpenHouse365.org
833 Raeburn Court, San Jose
OpenHouse365.org
For those still working from home, the property also has a bonus room with its own private entrance that can be used as an office.
833 Raeburn Court, San Jose
OpenHouse365.org
833 Raeburn Court, San Jose
OpenHouse365.org
Tam Lee, a real estate agent at Realty World Dominion who is listing the property, says the market in San Jose is increasingly becoming more competitive and has heated up even more so since November. She’s seeing a lot of buyers — particularly those who have young families — coming from other parts of San Jose where they were renting because of its relative affordability, but some are having problems nailing down offers because of the demand.
SAN FRANCISCO, Calif. (KRON) – Prices of office rents in San Francisco are at an all-time low.
This isn’t surprising, considering so many companies are still remote due to the ongoing coronavirus pandemic.
“Rents are relatively sticky despite growing downward pressure. Direct average asking office rents decreased 1.5% in Q1 2021, bringing the market average to $75.32.” according to a report by CBRE.
Compare that to Manhattan, where the asking rent is now $75.99 per square foot.
San Francisco’s office rents passed Manhattan’s back in 2016 when tech companies like Twitter and Uber made their mark in the tech-centric city.
In a research study by CBRE Top 100 Leases in 2020, “leasing by tech companies was down by more than half year-over-year, demonstrating a slowdown by even one of the most resilient industries.”
CBRE: Industry Breakdown of Top 100 Leases
CBRE also reported that Manhattan and Washington, D.C. accounted for nearly 40% of the top 100’s total square footage last year.
CBRE: Top 10 Active Markets New Lease Demand Drivers
Although office rents are lower than normal in San Francisco, the housing market experienced the opposite impact from the pandemic.
In January, Core Logic reported 36% Bay Area-wide increase in sales of single-family homes in eight Bay Area counties.
“We’re seeing multiple offers on most homes that are priced well. We’re seeing multiple offers. We’re seeing properties selling considerably over asking price,” Santa Clara County Association of Realtors president Doug Goss said.
CBRE says that moving forward, office rental rates are expected to continue declining, just at a slower rate.
