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SAN JOSE (CBS SF) – The number of homes affordable to median income people in San Jose dropped drastically in 2018, according to a new analysis this week.

In a study released by Redfin, the real estate website calculated the share of homes that were affordable to those earning the median income in 49 metro areas across the country.

Redfin found that in 2018, only 14 percent of homes for sale in the San Jose market were “affordable” to residents making the area’s median household income of $117,000, the lowest in the country. By comparison, 26 percent of homes were affordable to median income earners in 2017.

The 54 percent drop in affordable homes in San Jose comes as the total number of homes for sale in the market dropped by 15.6 percent.

“Prices have being going up for a number of years now and it’s made the lower priced homes more attractive,” said local real estate agent Gary Shapiro. “So more and more lower priced homes are selling and it’s leaving higher and higher priced properties on the market.”

Erik Devaney and his wife moved to California from the east coast three years ago. Renters like them had enough saved to buy a home, but never thought they’d buy in Silicon Valley.

“I personally had no interest in buying in the Bay Area,” said Devaney. However, when their landlord recently asked them if they wanted to buy their rental home, the Devaneys decided to seize the opportunity. They know they are some of the lucky ones.

“Everything just kind of clicked and we decided to go for it,” said Devaney. “We decided, hey, if we’re going to buy something, we better do it now because, love it or hate it, these tech companies are going to keep coming and keep moving in.”

“It’s going to be harder in the future for people to afford houses in the South Bay if they’re not tied into the tech industry, which tends to pay the highest salaries,” said Shapiro. The home Devaney is buying is 1,100 square feet and just under $1 million.

He said he may be buying a home in the least affordable city in the United States, but he’s not sold on staying in San Jose because he knows his money can get him much more somewhere else.

“This house in any other city would be significantly less,” said Devaney. “We’re paying for the location more than anything.”

• ALSO READ: 9 Astonishing Numbers On The Bay Area Housing Crisis In 2018

In the San Francisco market, 26 percent of homes in the market were affordable to median income earners last year, down from 31 percent in 2017. The total number of homes for sale in San Francisco actually inched up slightly in 2018.

Nationwide, researchers found while inventory is increasing, there were fewer homes affordable to the middle class in much of the country. In San Diego, for example, there were 16 percent fewer affordable homes for sale last year, despite an increase of sales by 10 percent.

The real estate website pointed to gains in home prices, along with interest rate increases as reasons why there are fewer affordable homes available.

• ALSO READ: 2 Cats Live By Themselves In $1500/Mo. Silicon Valley Studio

“Homeownership is increasingly out of reach for the typical American,” Redfin chief economist Daryl Fairweather said in a statement. “Over the last few years builders have focused on luxury homes, and there hasn’t been enough construction of affordable starter homes.”

St. Louis, Missouri had the highest percentage of affordable homes for median income earners in the country, at 84 percent.

The analysis assumes a 20 percent down payment and a monthly mortgage payment of no more than 30 percent of gross income.

A report by Zillow last year found it would take the median income household in San Jose a staggering 22 years to save up for a 20 percent down payment, if they saved 10 percent of their income every month.

Tim Fang is a digital producer for CBS San Francisco and a native of the Bay Area. Follow him on Twitter @fangtj.

Article source: https://sanfrancisco.cbslocal.com/2019/01/23/san-jose-affordable-housing-down-redfin-study/

The city is preparing to sell off its fire station in Jackson Square to a residential developer, but it won’t be at a fire-sale price.

Fire Station No. 13 at 530 Sansome St. is zoned for a 200-foot tower and is expected to fetch upward of $20 million. Proceeds from the sale will pay for a new firehouse on the same location, topped with luxury housing.

Whatever money is left after construction will be used to develop affordable housing at 772 Pacific Ave., a city-owned property that is home to the New Asia restaurant in nearby Chinatown. The $10 million in affordable housing fees the firehouse project is expected to generate will also be spent on the 80-unit Pacific Avenue development, which will also include a new dim sum banquet hall on the lower levels.

On Wednesday, the brokerage firm Colliers International will begin soliciting offers from builders interested in acquiring and developing the roughly 9,000-square-foot property in Jackson Square, one of San Francisco’s most historic and sought-after neighborhoods. About 100 family-sized units would be built above a new 22,000-square-foot fire station, a mix of uses that has been successfully combined in projects in Washington, D.C., Chicago, and Wilmington, Del.

The firehouse would have to be temporarily relocated while the new building is constructed. The fire station is 45 years old.

“This is an effective and innovative use of a public asset to generate capital investment in our aging infrastructure,” said City Administrator Naomi Kelly, who chairs the city’s Capital Planning Committee. “I am hopeful that this can be a model for better utilizing public property to meet the city’s affordable housing goals.”

In 2017 the city paid $5 million for 772 Pacific Ave. and started planning to build affordable units there. Chinatown power broker Rose Pak had advocated for the project before she passed away in September 2016.

District Three Supervisor Aaron Peskin, who wrote the legislation needed to make the deal possible, called the fire station parcel “one of the most under-built sites in the district.”

Peskin said that developing housing on the Sansome Street property is something he has been pushing for since his first stint on the board, which ended in 2009, but that the fire department initially resisted the idea. This time, the department supports the concept, he said.

Jeanine Nicholson, the Fire Department’s deputy chief of administration, said that she “considers this proposal a creative option to explore further with all stakeholders.”

While Peskin hasn’t always supported development in the area — he opposed both the redevelopment of the tennis club at 8 Washington St. on the Embarcadero and a condominium tower proposed for 555 Washington — the Sansome Street property is surrounded mostly by office buildings and is outside the historic core of Jackson Square, he said.

“A 20-foot building there is not going to block anybody’s views or piss off any of my constituents,” Peskin said. “And the funds that will come from the project will go toward building affordable housing in a Chinatown that needs it and deserves it.”

John Updike, the city’s former real estate director who is consulting on the project, said the value of the land would be “relatively equal to the cost of the new fire station,” which he said would cost at least $15 million.

“Anything extra would be gravy and would go toward the affordable housing,” he said.

Mayor London Breed said that the housing shortage is hurting the city and her administration would continue to look at publicly owned land as a solution.

“We need to get more creative in how and where we build housing,” she said. “Here in one project we can have a newly renovated fire station, more housing, and funding for badly needed affordable housing for our most vulnerable residents — all of which are top priorities for our city. I call that a win.”

The decision to sell the property comes as high construction costs and economic uncertainty have delayed some market rate projects in the city. But the higher end of the marketplace remains robust, particularly in historic neighborhoods like Jackson Square, which has had only two new housing developments in 15 years.

The most recent Jackson Square project, Grosvenor Americas’ 288 Pacific Ave., sold for nearly $2,000 a square foot, well above city averages.

In the marketing materials, Colliers International suggests the firehouse site would be suitable for “a luxury condominium, pied-a-terre concept with larger units, to capitalize on the luxury Jackson Square neighborhood.”

“The larger, more luxurious units is where the market is at,” Updike said.

Updike said that while Fire Station No. 13 is one of San Francisco’s most active firehouses, the city’s housing crisis mandates that all public sites be evaluated for residential development.

“It’s a better use of our property — we get a better fire station delivered by the private sector, which in theory means it could be done faster and for less money,” he said.

Updike lives at the Gateway Apartments not far from the firehouse. While living above a fire station might not appeal to light sleepers, most people would get used to it.

“It’s in the urban environment. It’s downtown. You get used to the noise,” he said.

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

Article source: https://www.sfchronicle.com/bayarea/article/Housing-proposed-above-S-F-firehouse-13553420.php

BURLINGAME, Calif.–(BUSINESS WIRE)–Cushman Wakefield (NYSE: CWK) has announced that Burlingame Point, a
brand new approximately 803,000-square-foot (sf) office campus currently
under construction in Burlingame, California, has finalized an agreement
with Facebook to lease the entire project. Situated on 18.13 acres on
the edge of the San Francisco Bay, Burlingame Point is a best-in-class
office development by Kylli, a wholly-owned subsidiary of China-based
Genzon Investment Group Co., Ltd.

Facebook first publicly announced the lease was in negotiations to the
City of Burlingame Planning Commission in August and the lease was fully
executed shortly thereafter in the fourth quarter of 2018. Mike Moran
and Clarke Funkhouser of Cushman Wakefield represented Kylli in the
transaction. JLL represented the tenant.

Moran said, “We couldn’t be more excited that one of the world’s leading
technology firms has selected Burlingame Point to expand their Northern
California footprint. This is a testament that strong design elements do
make a difference to the discerning tenant.”

Burlingame Point will execute on the City of Burlingame’s intent to
activate their waterfront. In addition to four new Class A office
buildings with bay views, the project will include public amenities such
as an improved Bay Trail, a vibrant pedestrian promenade, and a safer
roadway for cyclists and motorists. Fisherman’s Park also receives a
facelift as a result of the project.

Funkhouser said, “Now that construction is well underway, it is more
evident that this project will be an exceptional example of the
forward-thinking of both Kylli and their world class team of partners.”
He added, “Believed to be one of the largest lease transactions ever on
the San Francisco Peninsula, the project scale, location and quality
were all factors that helped to solidify this lease.”

Expected to open in 2020, Burlingame Point is the first Class A office
campus developed by Kylli in the Bay Area. They also own 225 Bush in San
Francisco (former Standard Oil Building) and 43 acres in Santa Clara
currently going through re-entitlement for a very large mixed-use
office, retail and residential development.

Source: Cushman Wakefield

About Kylli

Kylli Inc. was established in October 2013 in California, as a
wholly-owned subsidiary of Genzon Investment Group Co., Ltd., Kylli
carries an important mission to direct Genzon’s investment in the San
Francisco Bay Area. Kylli focuses on investment, development and
management of institutional quality assets in the United States.
Additional Bay Area properties owned by Kylli include 225 Bush in San
Francisco and 3005 Democracy Park in Santa Clara. Genzon is a
privately-held full service investment company headquartered in
Shenzhen, China, with diverse expertise and experience in developing and
managing a variety of building types, such as high-rise offices,
technology campuses, residential projects, hotels, and golf resorts.

About Cushman Wakefield

Cushman Wakefield (NYSE: CWK) is a leading global real estate services
firm that delivers exceptional value for real estate occupiers and
owners. Cushman Wakefield is among the largest real estate services
firms with 48,000 employees in approximately 400 offices and 70
countries. In 2017, the firm had revenue of $6.9 billion across core
services of property, facilities and project management, leasing,
capital markets, valuation and other services. To learn more, visit www.cushmanwakefield.com
or follow @CushWake
on Twitter.

Article source: https://www.businesswire.com/news/home/20190122005914/en/Burlingame-Point-Finalizes-Lease-Facebook-803000-SF

The dream of working for one of Silicon Valley’s many tech behemoths, along with the luxuries such a six-figure salary would afford, has resulted in droves of engineering degree-toting techies coming to the Bay Area.

Though, in reality, earning a tech salary is not all it’s cracked up to be.

In the nation’s most competitive real-estate market, it can be next to impossible to find affordable living accommodations. The housing crisis has left thousands struggling and has done nothing to help the city’s homelessness epidemic.

It costs $3,360 on average for a one-bedroom apartment in San Francisco. That means when the average starting tech salary of $91,738 is taken into account, some techies are shelling out a good portion of their paycheck solely on rent.

And when it’s time for those tech workers to buy a home, forget it: A recent study found that 60% of them felt they couldn’t afford one.

That’s all before factoring in other lofty expenses in the city, like $7 bacon strips.

From fraternity house-style “hacker houses” to sleeping in a Google parking lot, here’s what a tech salary in the “Tech Capital of the World” looks like.

Article source: https://www.businessinsider.com/living-in-san-francisco-on-tech-salary-disappointing-photos-2018-9

• 

  4519 Cherry Ave in San Jose is a 5 bed, 3 bath home of 2,500 sq ft. It’s been listed, gone pending but not sold, removed from MLS and put back, since 2016. Now it’s listed again for $1.199,500 million, down $200K from it’s last stint on the market in May of 2018

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  4519 Cherry Ave in San Jose is a 5 bed, 3 bath home of 2,500 sq ft. It’s been listed, gone pending but not sold, removed from MLS and put back, since 2016. Now it’s listed again for $1.199,500 million, down

  … more

  
  Photo: Place Holder
  

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4519 Cherry Ave in San Jose is a 5 bed, 3 bath home of 2,500 sq ft. It’s been listed, gone pending but not sold, removed from MLS and put back, since 2016. Now it’s listed again for $1.199,500 million, down $200K from it’s last stint on the market in May of 2018

less

4519 Cherry Ave in San Jose is a 5 bed, 3 bath home of 2,500 sq ft. It’s been listed, gone pending but not sold, removed from MLS and put back, since 2016. Now it’s listed again for $1.199,500 million, down

… more

Photo: Place Holder

Is San Jose on deck to be the hottest real estate market in 2019? If so, it would be the second year in a row the South Bay neighborhood takes that title. But not all signs point to “yes.”

Despite some recent cooling in the Bay Area market overall, San Jose experienced the nation’s highest year-over-year appreciation in home values and rents in 2018.

According to Zillow, we should expect more of the same this year.

A recent study shows that a combination of employment and market factors put San Jose on top again: “San Jose has the lowest unemployment rate and the most jobs per person among the 50 largest U.S. metros, along with the highest home values and forecasted home-value appreciation,” said Zillow.

No slump for San Jose?

Yet white hot markets of 2018 have been hit by ice of late, a reality the study doesn’t seem to fully address.

Seattle offers the most striking example of a hot market gone cold. The Seattle Times wrote in Seattle this January,”the median house is nearly $100,000 cheaper than last spring. And across King County, the number of condos available for buyers has more than quadrupled in the past year.”

And in fact, Seattle didn’t even make the top 10 predicted markets for this year, by Zillow’s figures.

San Jose, while not experiencing anything like Seattle’s reversal, has also changed.

Year-over-year, sold home prices have soared 16 to 25 percent or more (depending on size), but month-over-month, prices have been coming down since peaking in July. The gallery above includes a breakdown of that action.

Similarly, rents shot up alarmingly between 2017 and 2018 as a whole, but a closer look shows them declining slowly and steadily starting in September of last year.

The Mercury News observed in November, 2018 the South Bay slowed markedly in October of last year, due to a combination of seasonality and buyers “taking a wait-and-see approach before plunging into a record-setting market.”

Indeed, CoreLogic’s third quarter report showed sales in home sales in Santa Clara, Alameda and Contra Costa counties down 4 percent from the same time last year,,

One factor in this decline is increased inventory. “For-sale inventory in San Jose has doubled in recent months,” acknowledges Zillow.

Another factor to consider is changes in federal tax laws. Given that changes in tax structure will make home ownership more expensive for many Californians, buying power may have decreased overall.

On the other hand, San Jose employees are better poised than most to absorb this bump. Data show “the typical household income growing by 6.8 percent” currently in the area, Zillow pointed out.

Method

To find the hottest housing markets, Zillow looked for places where we expect home values and rents will outpace the nation in 2019, strong income growth, good job opportunities with low unemployment rates and a growing population.

These data suggest the top ten cities for 2019 are:

1. San Jose, Calif.
2. Orlando, Fl.
3. Denver, Colo.
4. Atlanta, Ga.
5. Minneapolis, Minn.
6. San Francisco, Calif.
7. Dallas, Texas
8. Nashville, Tenn.
9. Jacksonville, Fl.
10. San Diego, Calif.

Check out some homes for sale in what’s projected to be the hottest market (again) in the nation. As the gallery shows, it doesn’t seem like all of them are flying off the market; the examples we found are among many in San Jose that have lingered on the market and suffered one or more price cuts.

But then, it’s early days to be making predictions about 2019 and Bay Area real estate.

Anna Marie Erwert writes from both the renter and new buyer perspective, having (finally) achieved both statuses. She focuses on national real estate trends, specializing in the San Francisco Bay Area and Pacific Northwest. Follow Anna on Twitter: @AnnaMarieErwert  

Article source: https://www.sfgate.com/realestate/article/San-Jose-predicted-to-be-nation-s-hottest-market-13536976.php