Coronavirus: East Bay realtors believe virus is lowering interest rates, heating up home sales – KGO

CONTRA COSTA COUNTY, Calif. (KGO) — When it comes to the Bay Area real estate market, things are heating up more than was expected at the start of 2020. Novel coronavirus is behind some of the surge in home buying.

Bidding wars are back in many neighborhoods across the East Bay as buyers get in the game because of low-interest rates. Those low rates could be sustained into the summer because of coronavirus.

Ben Bauer, a mortgage banker with Delta Lending Group explained that with millions of Chinese workers quarantined, the products they produce globally won’t be shipped out as anticipated.

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“That means U.S. companies don’t have products to sell, which means it’s going to slow economic activity and investors will seek bonds and bonds drive mortgage rates so mortgage rates will fall or stay the same. “

Abio Properties owner and agent Linnette Edwards said, “There’s a buyer frenzy. Buyers feel very energized right now with the low interest rates. Last year in quarter four we had few buyers. This year we have a lot of buyers. And they are motivated. “

A frenzy of buyers, but little inventory on the market means bidding wars are back.

“We are seeing Castro Valley, San Lorenzo, parts of Oakland and parts of San Leandro over the asking price,” Tina Hand, president of the Bay East Association of Realtors said.

Edwards said it’s not uncommon to see homes in Alameda County now going 30 or 40 percent over the listing price.

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“I had one in the Berkeley hills just last week. We were the lowest offer. It was listed at $1.3 million and we went in at $1.6,” she said.

It’s similar in parts of Contra Costa County that are close to the transit corridors.

Real estate agent Vicky Bearman said in, “Walnut Creek, Lamorinda, Alamo, Danville, and San Ramon there’s just not enough inventory for the demand.”

According to Hand, the prediction for the spring and summer ahead is, “if interest rates stay low and inventory stays low it will probably be a feeding frenzy again.”

Mortgage interest rates have dipped to around 3.5% on some loans and the sweet spot for homes in this so-called feeding frenzy are those priced between $1 million and $1.5 million.

Article source: https://abc7news.com/5944973

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Real estate agents are feeling pressure from low housing inventory

As housing inventory continues to dwindle, competition with buyers and agents has reached a high.

According to a recent realtor.com report, the nation’s inventory of homes for sale sank 14% in January, falling to the lowest level since at least 2012.

Now, the latest survey from Redfin shows the real estate agents are also feeling the crunch. The survey, which went out to more than 500 agents across the country, showed that the majority faced competition in January.

The highest rate of competition was in the San Francisco Bay Area, where agents estimated that more than 90% of the time there were multiple offers on homes their clients were bidding on, even though the median home price was listed well above $1 million.

Low mortgage rates have brought buyers back to the housing market, but a lack of listings means buyers are having to compete with one another to secure a sale and lock in a mortgage rate,” said Redfin Chief Economist Daryl Fairweather. “This competition pushes up prices, which means that even though buyers can get a good deal on a mortgage now they are often paying a higher sticker price.”

Out of the 24 markets that Redfin looked at, homebuyers in 19 of the markets faced competition more often than not.

Least prone to the competition? Greenville, South Carolina.

Meanwhile, in the Bay Area, buyers are going to extreme lengths to win a home, the survey showed.

“After missing out on one home due to a bidding war, my clients were much more aggressive on their next offer,” said Redfin San Jose real estate agent Jennifer Tollenaar. “In order to beat 24 other offers, they put 50% down, wrote a great letter to the sellers and removed all contingencies. This was on a home with a purchase price of over $1.7 million.”

Similar to the Bay Area, Los Angeles is also a competitive market that has homes listed for longer periods.

“Not every home sells quickly and with multiple offers, but when my buyers are interested in submitting an offer it is almost always a home that has multiple offers,” said Redfin Irvine Real Estate Agent Liz Flesner.

Despite the West Coast seeing all of this competition, Philadelphia has homes on the market that attract the most bidding wars.

“One home I recently helped my clients win had been on the market since June and hadn’t been reduced in price since November,” said Redfin Philadelphia Real Estate Agent Brenda Beiser. “When we looked at it in mid-January, the agent told me there had been six other appointments the day before. By the time our offer went in that evening they had received two other offers.”

Article source: https://www.housingwire.com/articles/real-estate-agents-are-feeling-pressure-from-low-housing-inventory/

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What the coronavirus shutdown means for the Bay Area’s housing crisis

As much of the Bay Area’s economy sputters to a halt due to the new coronavirus, housing builders are plugging away — pouring concrete and hanging drywall — even as they impose strict hygiene rules and ask workers to keep a safe distance from one another.

On Monday, the six Bay Area counties that issued a shelter-in-place order included housing construction on the list of essential services that are exempt from shutting down. The order allows all housing projects to continue — market rate, affordable, and mixed-use — while construction projects that are strictly commercial must temporaily shut down.

“Mayor Breed absolutely believes building housing is an essential function at this point,” said mayoral spokesman Jeff Cretan. “We need that work to continue.”

Currently, there are 10,000 units under construction in San Francisco. About 4,300 were completed in 2019.

The shelter-in-place order Monday sowed some confusion among builders who were under the impression that they would be forced to shut down job sites. Bob Nibbi, president of Nibbi Brothers Construction, which is currently building nine Bay Area housing projects, said he was starting to do just that before learning that housing construction could continue. The company has several commercial building jobs that will be suspended.

“Our housing job sites will remain open,” said Nibbi.

The company implemented social distancing and strict hygiene rules several weeks ago, he added. “Morale is still good. Our people are happy to be coming to work and earning a living,” he said. “Especially when you are seeing layoffs in so many other industries.”

Eric Tao, a partner with L37 Partners, said construction at 950 Market St. is progressing, with the ninth floor poured this week. That project, which has 232 condos, a theater and 242-room hotel, will continue. At Factory O/S, a modular housing factory on Vallejo’s Mare Island, three housing projects are being constructed on the assembly line, including two affordable complexes and one for Google workers.

Factory O/S President Rick Holliday said workers have been ordered to stay 5 feet from one another, while janitorial services have been tripled and hand-washing stations have been added throughout the building.

“Our guys want to work. We have 270 people banging away. Their attitude is, ‘We’ve got housing to build for the homeless. And we have plenty of plywood and sheet-rock,’” he said. “We are business as usual while being extra vigilant about hygiene.”

He said he thinks there will be a brief pause in financing new projects.

“I’d be surprised if any deals got done this month, but I don’t think capital will flee housing,” he said. “We are still 3 million units short in the Bay Area.”

Sam Moss, executive director of Mission Housing, which is building two affordable projects, said his group would continue to build.

“We are doing everything we can to keep our workers safe but in this crisis it’s more clear than ever than housing people is the among most important factors in keeping people healthy,” he said. “The housing crisis is a self-inflicted wound cause over the course of decades. It’s good that elected officials are taking it seriously.”

But while projects still under construction are going ahead for now, developers say the fast-moving virus will eventually disrupt new housing production, exacerbating the region’s already severe housing shortage. The pandemic could make it harder to obtain building materials, while widespread sickness could fuel a worker shortage or shut down job sites altogether.

Already lenders have at least temporarily stopped writing loans for new construction projects, said John Manning, a broker with Avison Young, which helps developers finance housing development. On Thursday, a lender canceled a loan on a 100-unit West Coast condo project, although Manning wasn’t authorized to discuss the details.

“There is going to be a mass pause in the very short term,” said Manning. “If we have two months of home isolation and then things start to flatten out and get better, I’m imaging the banks and equity funds will gradually put their toes back in the water.”

Tao of L37 agreed. His group is raising capital for a new project — 299 units at 1270 Mission St. — which he said will likely be delayed.

“Right now, lenders are sitting on the sidelines waiting to see what happens before deploying more capital,” he said.

A lack of liquidity in the markets could slow down the city’s multi-phase megaprojects, like India Basin, Treasure Island and Candlestick Point. Other projects that were already languishing due to a lack of financing before the coronavirus hit the Bay Area, like the proposed condo tower at 1 Oak St., could drag on even longer.

“It’s too early to know what the impact will be, but it’s hard to imagine that housing production won’t be delayed by workforce and financing issues, just for starters,” said Judson True, Mayor London Breed’s point person on housing production. “Clearly, the city’s focus right now is on public health, but at some point we may have to look at even more creative strategies to take on the housing landscape we face after the virus recedes.”

Emerald Fund President Oz Erickson, who has built thousands of housing units in San Francisco, said that historically low interest rates will make it cheaper to build housing. But that COVID-19 will slow down construction as workers call in sick and building material deliveries slow down.

High construction expenses and city-imposed fees have already increased the cost of building in San Francisco to about $800,000 a unit in San Francisco, which makes building anything challenging, he said.

“The coronavirus will be an additional impediment to financing any project, which was already exceedingly difficult,” he said. “This is going to do nothing to help with construction costs.”

The health crisis could be a mixed bag for affordable-housing developers. Low interest rates could make it cheaper to borrow money. A hiatus in market-rate projects could cool down competition for land, lowering costs for taxpayer-subsidized projects. But the cooler market wouldn’t matter if the coronavirus substantially depletes the workforce.

In addition, affordable projects in San Francisco are backed by the city’s top-notch credit, which makes them safe haven for investors in turbulent times, said Rebecca Foster, chief executive officer for the San Francisco Housing Accelerator Fund, a public-private partnership that helps pay for the production and preservation of affordable housing.

But affordable developers also face increased uncertainty. The coronavirus is already disrupting the tax-exempt bond market, Foster said. Most affordable-housing projects in San Francisco are funded in part through the sale of tax-exempt bonds.

Foster said she is getting ready to sell tax-exempt bonds in the next few months for a supportive-housing project for the formerly homeless in the South of Market.

“It’s possible the bonds will sell for less than expected, but also possible that there will be no buyers,” she said. “It adds another layer of uncertainty, and that can impact your timing and add to costs.”

J.K. Dineen is a San Francisco Chronicle staff writer. Email: jdineen@sfchronicle.com Twitter: @SFjkdineen

Article source: https://www.sfchronicle.com/local-politics/article/What-the-coronavirus-shutdown-means-for-the-Bay-15136169.php

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Who can leave their home? Read the ‘shelter in place’ order for 7 Bay Area counties

For complete coverage of the COVID-19 outbreak, head to mercurynews.com/coronavirus.

The following is the text of the legal order from Contra Costa County announced Monday afternoon. Other Bay Area counties – Santa Clara, San Mateo, San Francisco, Alameda, Santa Cruz and Marin, and the city of Berkeley – issued the same order:

Please read this Order carefully. Violation of or failure to comply with this Order is a misdemeanor punishable by fine, imprisonment, or both. (California Health and Safety Code § 120295, et seq.)

UNDER THE AUTHORITY OF CALIFORNIA HEALTH AND SAFETY CODE SECTIONS 101040, AND 120175, THE HEALTH OFFICER OF THE COUNTY OF CONTRA COSTA (“HEALTH OFFICER”) ORDERS:

1. The intent of this Order is to ensure that the maximum number of people self-isolate in their places of residence to the maximum extent feasible, while enabling essential services to continue, to slow the spread of COVID-19 to the maximum extent possible. When people need to leave their places of residence, whether to obtain or perform vital services, or to otherwise facilitate authorized activities necessary for continuity of social and commercial life, they should at all times reasonably possible
comply with Social Distancing Requirements as defined in Section 10 below. All provisions of this Order should be interpreted to effectuate this intent. Failure to comply with any of the provisions of this Order constitutes an imminent threat to public health.

2. All individuals currently living within Contra Costa County (the “County”) are ordered to shelter at their place of residence. To the extent individuals are using shared or outdoor spaces, they must at all times as reasonably possible maintain social distancing of at least six feet from any other person when they are outside their residence. All persons may leave their residences only for Essential Activities, Essential Governmental Functions, or to operate Essential Businesses, all as defined in Section 10. Individuals experiencing homelessness are exempt from this Section, but are strongly urged to obtain shelter, and governmental and other entities are strongly urged to make such shelter available as soon as possible and to the maximum extent practicable (and to utilize Social Distancing Requirements in their operation).

3. All businesses with a facility in the County, except Essential Businesses as defined below in Section 10, are required to cease all activities at facilities located within the County except Minimum Basic Operations, as defined in Section 10. For clarity, businesses may also continue operations consisting exclusively of employees or contractors performing activities at their own residences (i.e., working from home). All Essential Businesses are strongly encouraged to remain open. To the greatest extent feasible, Essential Businesses shall comply with Social Distancing Requirements as defined in Section 10 below, including, but not limited to, when any customers are standing in line.

4. All public and private gatherings of any number of people occurring outside a household or living unit are prohibited, except for the limited purposes as expressly permitted in Section 10. Nothing in this Order prohibits the gathering of members of a household or living unit.

5. All travel, including, but not limited to, travel on foot, bicycle, scooter, motorcycle, automobile, or public transit, except Essential Travel and Essential Activities as defined below in Section 10, is prohibited. People must use public transit only for purposes of performing Essential Activities or to travel to and from work to operate Essential Businesses or maintain Essential Governmental Functions. People riding on public transit must comply with Social Distancing Requirements as defined in Section 10 below, to the greatest extent feasible. This Order allows travel into or out of the County to perform Essential Activities, operate Essential Businesses, or maintain Essential Governmental Functions.

6. This Order is issued based on evidence of increasing occurrence of COVID-19 within the County and throughout the Bay Area, scientific evidence and best practices regarding the most effective approaches to slow the transmission of communicable diseases generally and COVID-19 specifically, and evidence that the age, condition, and health of a significant portion of the population of the County places it at risk for serious health complications, including death, from COVID-19. Due to the outbreak of the COVID-19 virus in the general public, which is now a pandemic according to the World Health Organization, there is a public health emergency throughout the County. Making the problem worse, some individuals who contract the COVID-19 virus have no symptoms or have mild symptoms, which means they may not be aware they carry the virus. Because even people without symptoms can transmit the disease, and because evidence shows the disease is easily spread, gatherings can result in preventable transmission of the virus. The scientific evidence shows that at this stage of the emergency, it is essential to slow virus transmission as much as possible to protect the most vulnerable and to prevent the health care system from being overwhelmed. One proven way to slow the transmission is to limit interactions among people to the greatest extent practicable. By reducing the spread of the COVID-19 virus, this Order helps preserve critical and limited healthcare capacity in the County.

7. This Order also is issued in light of the existence of 29 cases of COVID-19 in the County, as well as at least 258 confirmed cases and at least three deaths in the seven Bay Area jurisdictions jointly issuing this Order, as of 5 p.m. on March 15, 2020, including a significant and increasing number of suspected cases of community transmission and likely further significant increases in transmission. Widespread testing for COVID-19 is not yet available but is expected to increase in the coming days. This Order is necessary to slow the rate of spread and the Health Officer will re-evaluate it as further data becomes available.

8. This Order is issued in accordance with, and incorporates by reference, the March 4, 2020 Proclamation of a State of Emergency issued by Governor Gavin Newsom, This Order is issued in accordance with, and incorporates by reference, the March 4, 2020 Proclamation of a State of Emergency issued by Governor Gavin Newsom and the March 10, 2020 Resolution of the Contra Costa County Board of Supervisors declaring the existence of a Local Emergency in Contra Costa County.

9. This Order comes after the release of substantial guidance from the County Health Officer, the Centers for Disease Control and Prevention, the California Department of Public Health, and other public health officials throughout the United States and around the world, including a variety of prior orders to combat the spread and harms of COVID19. The Health Officer will continue to assess the quickly evolving situation and may modify or extend this Order, or issue additional Orders, related to COVID-19.

10. Definitions and Exemptions.

a. For purposes of this Order, individuals may leave their residence only to perform any of the following “Essential Activities.” But people at high risk of severe illness from COVID-19 and people who are sick are urged to stay in their residence to the extent possible except as necessary to seek medical care.

i. To engage in activities or perform tasks essential to their health and safety, or to the health and safety of their family or household members (including, but not limited to, pets), such as, by way of example only and without limitation, obtaining medical supplies or medication, visiting a health care professional, or obtaining supplies they need to work from home.

ii. To obtain necessary services or supplies for themselves and their family or household members, or to deliver those services or supplies to others, such as, by way of example only and without limitation, canned food, dry goods, fresh fruits and vegetables, pet supply, fresh meats, fish, and poultry, and any other household consumer products, and products necessary to maintain the safety, sanitation, and essential operation of residences.

iii. To engage in outdoor activity, provided the individuals comply with Social Distancing Requirements as defined in this Section, such as, by way of example and without limitation, walking, hiking, or running.

iv. To perform work providing essential products and services at an Essential Business or to otherwise carry out activities specifically permitted in this Order, including Minimum Basic Operations.

v. To care for a family member or pet in another household.

b. For purposes of this Order, individuals may leave their residence to work for or obtain services at any “Healthcare Operations” including hospitals, clinics, dentists, pharmacies, pharmaceutical and biotechnology companies, other healthcare facilities, healthcare suppliers, home healthcare services providers, mental health providers, or any related and/or ancillary healthcare services. “Healthcare Operations” also includes veterinary care and all healthcare services provided to animals. This exemption shall be construed broadly to avoid any impacts to the delivery of healthcare, broadly defined. “Healthcare Operations” does not include fitness and exercise gyms and similar facilities.

c. For purposes of this Order, individuals may leave their residence to provide any services or perform any work necessary to the operations and maintenance of “Essential Infrastructure,” including, but not limited to, public works construction, construction of housing (in particular affordable housing or housing for individuals experiencing homelessness), airport operations, water, sewer, gas, electrical, oil refining, roads and highways, public transportation, solid waste collection and removal, internet, and telecommunications systems (including the provision of essential global, national, and local infrastructure for computing services, business infrastructure, communications, and web-based services), provided that they carry out those services or that work in compliance with Social Distancing Requirements as defined this Section, to the extent possible.

d. For purposes of this Order, all first responders, emergency management personnel, emergency dispatchers, court personnel, and law enforcement personnel, and others who need to perform essential services are categorically exempt from this Order. Further, nothing in this Order shall prohibit any individual from performing or accessing “Essential Governmental Functions,” as determined by the governmental entity performing those functions. Each governmental entity shall identify and designate appropriate employees or contractors to continue providing and carrying out any Essential Governmental Functions. All Essential Governmental Functions shall be performed in compliance with Social Distancing Requirements as defined in this Section, to the extent possible.

e. For the purposes of this Order, covered businesses include any for-profit, nonprofit, or educational entities, regardless of the nature of the service, the function they perform, or its corporate or entity structure.

f. For the purposes of this Order, “Essential Businesses” means:
i. Healthcare Operations and Essential Infrastructure;
ii. Grocery stores, certified farmers’ markets, farm and produce stands, supermarkets, food banks, convenience stores, and other establishments engaged in the retail sale of canned food, dry goods, fresh fruits and vegetables, pet supply, fresh meats, fish, and poultry, and any other household consumer products (such as cleaning and personal care products). This includes stores that sell groceries and also sell other nongrocery products, and products necessary to maintaining the safety, sanitation, and essential operation of residences;
iii. Food cultivation, including farming, livestock, and fishing;
iv. Businesses that provide food, shelter, and social services, and other necessities of life for economically disadvantaged or otherwise needy individuals;
v. Newspapers, television, radio, and other media services;
vi. Gas stations and auto-supply, auto-repair, and related facilities;
vii. Banks and related financial institutions;
viii. Hardware stores;
ix. Plumbers, electricians, exterminators, and other service providers who provide services that are necessary to maintaining the safety, sanitation, and essential operation of residences, Essential Activities, and Essential Businesses;
x. Businesses providing mailing and shipping services, including post office boxes;
xi. Educational institutions—including public and private K-12 schools, colleges, and universities—for purposes of facilitating distance learning or performing essential functions, provided that social distancing of six-feet per person is maintained to the greatest extent possible;
xii. Laundromats, drycleaners, and laundry service providers;
xiii. Restaurants and other facilities that prepare and serve food, but only for delivery or carry out. Schools and other entities that typically provide free food services to students or members of the public may continue to do so under this Order on the condition that the food is provided to students or members of the public on a pick-up and take-away basis only. Schools and other entities that provide food services under this exemption shall not permit the food to be eaten at the site where it is provided, or at any other gathering site;
xiv. Businesses that supply products needed for people to work from home;
xv. Businesses that supply other Essential Businesses with the support or supplies necessary to operate;
xvi. Businesses that ship or deliver groceries, food, goods or services directly to residences;
xvii. Airlines, taxis, and other private transportation providers providing transportation services necessary for Essential Activities and other purposes expressly authorized in this Order;
xviii. Home-based care for seniors, adults, or children;
xix. Residential facilities and shelters for seniors, adults, and children;
xx. Professional services, such as legal or accounting services, when necessary to assist in compliance with legally mandated activities;
xxi. Childcare facilities providing services that enable employees exempted in this Order to work as permitted. To the extent possible, childcare facilities must operate under the following mandatory conditions:
1. Childcare must be carried out in stable groups of 12 or fewer (“stable” means that the same 12 or fewer children are in the same group each day).
2. Children shall not change from one group to another.
3. If more than one group of children is cared for at one facility, each group shall be in a separate room. Groups shall not mix with each other.
4. Childcare providers shall remain solely with one group of children. g. For the purposes of this Order, “Minimum Basic Operations” include the following, provided that employees comply with Social Distancing Requirements as defined this Section, to the extent possible, while carrying out such operations:
i. The minimum necessary activities to maintain the value of the business’s inventory, ensure security, process payroll and employee benefits, or for related functions.
ii. The minimum necessary activities to facilitate employees of the business being able to continue to work remotely from their residences.

h. For the purposes of this Order, “Essential Travel” includes travel for any of the following purposes. Individuals engaged in any Essential Travel must comply with all Social Distancing Requirements as defined in this Section below.
i. Any travel related to the provision of or access to Essential Activities, Essential Governmental Functions, Essential Businesses, or Minimum Basic Operations.
ii. Travel to care for elderly, minors, dependents, persons with disabilities, or other vulnerable persons.
iii. Travel to or from educational institutions for purposes of receiving materials for distance learning, for receiving meals, and any other related services.
iv. Travel to or return from a place of residence outside the jurisdiction.
v. Travel required by law enforcement or court order.
vi. Travel required for non-residents to return to their place of residence outside the County. Individuals are strongly encouraged to verify that their transportation out of the County remains available and functional prior to commencing such travel.
i. For purposes of this Order, residences include hotels, motels, shared rental units and similar facilities.
j. For purposes of this Order, “Social Distancing Requirements” includes maintaining at least six-foot social distancing from other individuals, washing hands with soap and water for at least twenty seconds as frequently as possible or using hand sanitizer, covering coughs or sneezes (into the sleeve or elbow, not hands), regularly cleaning high-touch surfaces, and not shaking hands.
11. Pursuant to Government Code sections 26602 and 41601 and Health and Safety Code section 101029, the Health Officer requests that the Sheriff and all chiefs of police in the County ensure compliance with and enforce this Order. The violation of any provision of this Order constitutes an imminent threat to public health.
12. This Order shall become effective at 12:01 a.m. on March 17, 2020 and will continue to be in effect until 11:59 p.m. on April 7, 2020, or until it is extended, rescinded, superseded, or amended in writing by the Health Officer.
13. Copies of this Order shall promptly be: (1) made available at Office of the Director of Health of Contra Costa County, 1220 Morello Ave, Martinez CA 94553; (2) posted on the County Public Health Department website www.cchealth.org; and (3) provided to any member of the public requesting a copy of this Order.
14. If any provision of this Order to the application thereof to any person or circumstance is held to be invalid, the reminder of the Order, including the application of such part or provision to other persons or circumstances, shall not be affected and shall continue in full force and effect. To this end, the provisions of this Order are severable.
15. Questions or comments regarding this order may be directed to Contra Costa Health Services at 1-844-729-8410.


Article source: https://www.mercurynews.com/read-shelter-in-place-order-from-six-bay-area-counties

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Could the Bay Area Emerge Stronger After COVID-19?

he threat of the coronavirus has brought the normally rapid pace of Bay Area life to a grinding halt. With a growing number of confirmed cases, a state of emergency in effect, and a directive to shelter in place for the next three weeks, the virus is affecting life from all angles. Our normally lively streets are empty, our roads less congested.

The urgent call for people to social distance has resulted in school cancellations, events being called off, and regulations limiting restaurants and bar operations. COVID-19 has also caused Bay Area’s tech titans — which usually favor face-to-face contact among staff, even busing people from all over the region at a cost of hundreds of millions per year to achieve that — to close and tell people to work from home. Even companies that are usually starkly against telework have been forced to embrace it, including Apple, Facebook, Amazon, and Google.

The result: Tens of thousands fewer people are out in the Bay Area than during normal times. I’m doing my best to stay home and social distance, which is incredibly important, but in the moments I have ventured out when necessary, I’ve witnessed a rare and fascinating place — a Bay Area with far fewer people. In many ways, the roads and streets are a throwback to what I imagine the region was like before the rise of Silicon Valley.

Since 2010, the Bay Area’s population has grown by more than 600,000 people. That’s an 8.5% increase for an area that’s fairly dense to begin with. More than 7 million people now live in the nine counties that surround the bay. This rapid growth has bred all manner of evils and inconveniences. Real estate prices in the Bay Area have more than doubled since 1997 in real terms. Constrained by inelastic supply, the median home price in the region is now above $1 million.

And then there’s just the dense, constant presence of people. Especially in the city, crowds are everywhere. Don’t get me wrong, I love living in the Bay Area and feel that life here is totally worth it. The crowds, rapid growth, and even the traffic contribute to the exciting, chaotic, frenetic energy of the place, which has been constantly disrupting and reinventing itself for more than a century. It’s a wonderful place to live. But in normal times, it’s undeniably crowded.

In effect, the entire tech industry is forced into a massive experiment at once.

Today, even the Bay Area’s legendary traffic, now (normally) the second-worst in the nation behind only car-obsessed Los Angeles. Bay Area drivers waste 3.3 billion gallons of fuel every year while waiting in traffic delays. A recent rush hour drive from the East Bay into San Francisco for an essential doctor’s appointment — which normally takes me two hours from San Ramon — was showing as one hour and seven minutes on Google Maps.

I arrived here in 2013, when the tech boom was already in full swing, so it was a new experience to see the Bay Area as a calmer and emptier place.

Traffic is a relatively minor example. But in several far more significant ways, the Bay Area has already changed dramatically as a result of the unfolding COVID-19 crisis. Of course, there’s no guarantee that any of this will persist. As the threat of the virus (hopefully) abates, life in the Bay Area could go right back to normal.

Or it could not. Big changes to lives and economies — even those caused by disasters and other shocks — have a tendency to be sticky. After September 11, companies reduced business travel and realized much of it wasn’t actually necessary. They invested in technologies like teleconferencing and found that these worked surprisingly well. Even after the original shock had dissipated, a lot of companies kept their travel budgets lean once they found a new way to operate that tested previous conventional wisdom.

With the sudden, unavoidable shift to telework in the Bay Area under the threat of COVID-19, this dynamic may apply. Big tech companies may realize that the constant, coveted face time isn’t so important for productivity and innovation after all.

The all-encompassing nature of the outbreak could be a major factor here. For a giant like Facebook, testing a new telework scheme across the entire company all at once would be unacceptably risky in normal times. If it failed — and if rivals’ policies of encouraging in-person interactions continued to succeed — the company could fall behind the competition in an irreversible way.

But now that everyone is forced into this setup, the risk drops dramatically. There’s no longer a first-mover disadvantage. In effect, the entire tech industry is forced into a massive experiment at once. And the results of that experiment could lead to broad and lasting shifts in the work environment for Big Tech. It could encourage more remote work in the Bay Area or push tech companies toward hiring remote workers in less expensive regions if they find that telework is just as productive as the in-person kind.

Likewise, the current shock will likely have major impacts on housing prices, especially given they were cooling off before the outbreak. The current shock could send them dramatically lower overnight. A recession isn’t something to celebrate, to be sure, but it could be a new landscape that creates buying opportunities that young people and lower-income workers haven’t seen in decades.

COVID-19 may also have a lasting impact on the region’s homeless population. We’ve seen cities step up and treat homelessness like the emergency it is. San Francisco is committing $5 million to support the city’s homeless. This includes funds for supportive housing and shelters. The city has also halted evictions, which will help to prevent more residents affected by the crisis’ economic fallout to slip into homelessness. The reality was that our homelessness crisis was just as much of an emergency before this crisis and should have been treated as such, but the pandemic has forced the issue.

If the crisis moves more of San Francisco’s homeless into housing, it could make a major dent in the city’s homelessness problem and provide a better quality of life for thousands of the city’s most vulnerable residents. At the very least, it shows that the city was capable of more than what it was doing previously and should be held to that standard moving forward.

We could also see a lasting effect on the Bay Area’s gig economy workers. Home to the headquarters of Uber, DoorDash, and myriad other companies that rely on a labor force of on-demand workers — classified as independent contractors rather than employees — who are not provided health insurance or paid sick leave. As the current crisis has unfolded, tech companies have started to provide such benefits to their workforce, whether employees or not. Both Uber and Lyft now offer paid leave to most drivers; others, like DoorDash and Instacart, have followed suit.

Some have argued that what the companies are doing isn’t enough, and it’s likely that officials will continue to step up measures as the pandemic gets worse before it gets better. We could see that once COVID-19 passes, gig economy companies may see the merits of classifying their workers as employees so that the benefits they’re providing anyway are easier to administrate (and to avoid the cost of California’s new gig economy AB 5 law, which they’re in the middle of fighting). No matter what, it’s clear that how we’re functioning now — with absolutely no safety net for a huge swath of workers — is not how we should move forward.

Even disasters can breed lasting, powerful changes. That is especially true for the Bay Area.

Beyond these concrete changes, we’ve seen the Bay Area change in recent weeks when it comes to a sense of community, shared purpose, and connection among many of our residents. Deserved or not, the Bay Area has a reputation for workaholic citizens who rarely take the time to engage with their local communities or neighbors. In normal times, my Nextdoor feed is a mix of complaints about the actions of local drivers and vaguely racist messages.

With the current crisis, things have changed. Now I mostly see messages about residents bringing food to seniors, sharing tips on entertaining their kids while sheltering at home, and otherwise helping each other through these challenging times. When grocery shelves were empty this weekend due to the added strain on the supply chain (stop panic buying and hoarding), I took a brief walk around my neighborhood and saw a basket of homegrown lemons next to our mailboxes, with a handwritten note reading, “Neighbors, please help yourself.”

As people find unexpected sources of support among their neighbors and community members, the crisis may foster a stronger sense of place and draw Bay Area residents closer together in a lasting way.

The pandemic has brought all of our area’s problems into sharp focus: the high cost of living, homelessness, the gig economy, the need for renter protections, and the way we treat our neighbors.

Make no mistake, COVID-19 is a major threat and a potential disaster of epic proportions for our health, our economy, and our local businesses. It’s not something to take lightly. But even disasters can breed lasting, powerful changes. And that is especially true for the Bay Area.

Our region has a long history of emerging, phoenixlike, from major shocks. San Francisco’s infamous 1906 earthquake led to the splendor of the 1915 Panama Pacific Exposition, massive changes in patterns of land use, and the creation of entirely new regions of the city, which has been booming for a century. Again, in 1989, our communities worked together to rebuild.

Recovery and regrowth are deeply ingrained in our DNA. I’m confident the Bay Area can make it through this current crisis. Maybe, just maybe, we’ll even emerge stronger.

Article source: https://thebolditalic.com/one-covid-19-side-effect-a-more-livable-bay-area-2f443b43ea38

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