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When it comes to holiday season traditions, real estate site Property Shark’s annual assessment of the most expensive ZIP codes in America isn’t the most cheerful.

But it provides an increasingly reliable calendar marker, and a reminder that, even though the San Francisco real estate market has slackened a bit in 2018, that’s no reason to lose perspective on just how stratospheric the cost of a roof is in the Bay Area.

Property Shark tabulates home sales based on “actual closed sale prices, and not asking prices,” calculates a median for each ZIP code in the nation, and ranks the top 100 accordingly. (This year’s list includes 117 entries thanks to a number of ties.)

The median includes all types of home sales, “taking into account condo, co-ops, single- and two-family homes.”

For 2018, 82 of the top 100 ZIPs are in California, up from 77 last year. Property Shark writer Eliza Theiss singles out Silicon Valley as “home to some of the most expensive residential real estate in the country [and] world.”

San Francisco has nine entries on the list, tied with New York City for the most citations; however, New York’s ritziest neighborhood came in No. 4 nationwide while SF’s most unobtainable locales ranked quite a bit lower.

Here’s a survey of the damage:

• Once again, Atherton’s 94027 ZIP code is the nation’s priciest place to buy. Atherton took the top spot in 2017, up from No. 2 in 2016. This year the Bay Area’s most hoity-toity burgh saw a median sale price of $6.7 million, up from $4.95 million last year. According to the U.S. Census, Atherton has a population of just more than 7,200 people, so its smaller sample size tilts toward big year-over-year spikes and dips.
• The next priciest Bay Area locale is Palo Alto’s 94301, which landed in sixth place with a median of $3.75 million-plus. Palo Alto ranked seventh in 2017.

• You have to scroll all the way down to No. 40 to find San Francisco’s first appearance: The 94123 ZIP averaged $2.07 million-plus in 2018. That’s the area covering the Marina and Cow Hollow. In 2017, the city’s most expensive area was the Richmond and Presidio Heights, with $1.9 million.
• Speaking of which, this time around the city’s second-biggest spenders favored 44th place 94118, which covers the Inner Richmond and Presidio Heights, and shakes out to $1.97 million and some change.
• The rest of the city’s top five rounds out to 94127 (Saint Francis Wood, Mount Davidson, and Balboa Terrace, among others) in a tie for 54th place at $1.8 million, 94114 (Castro and Noe Valley) in 60th with $1.72 million, and 94121 (Sea Cliff and Outer Richmond) in 75th place with $1.61 million.
• Alameda County appears on the list three times: Fremont’s 94539 coming in at No. 83 with a $1.52 million median; Oakland’s 94618 (which covers Rockridge) at No. 95, which averaged $1.45 million (tied with nearby Orinda); and Berkeley’s 94705 at No. 98 with $1.44 million.

For the full rankings in all of their gritty glory, check here.

• Most Expensive ZIP Codes, 2018 [PropertyShark]
• Most Expensive ZIP Codes, 2017 [PropertyShark]
• Atherton, CA [US Census]

Article source: https://sf.curbed.com/2018/11/28/18116315/most-expensive-zip-codes-2018-atherton-bay-area

News on Bay Area real estate markets is mixedGetty

Mixed housing market news for Bay Area home buyers and sellers comes directly from the latest economic number crunching by Selma Hepp, chief economist at the San Francisco-based luxury brokerage, Pacific Union International/Compass.

The main story, according to Hepp is about affordability. Despite a 19 percent year-over-year increase in affordable inventory, buyers aren’t falling over each other making multiple offers and snapping up properties.  Buyers of homes priced below $1 million are restrained, with the fewest number of homes selling for more than asking price since January 2017.

“I think the most striking insight is how much the affordable home buyers cooled off, even in light of more inventory across the region. Early-year price growth and interest rates have really taken a bite out of their budget,” Hepp explains. “I was a little surprised to see such a decline given the continued strength in the local economy and job growth. I think we may still see some activity among these buyers as they notice more inventory and get used to the price shock.”

Here are highlights from Hepp’s market analysis working with October’s numbers. Bay Area home sales dipped by 8 percent year over year last month. Yet sales were up 19 percent from September. Santa Clara County and East Bay counties continued to lead the sales declines, while San Francisco activity remained steady on an annual basis. Sales of higher priced homes, in the $2 million and up range, rebounded, by 24 percent from October 2017, following a drop in September.

“Sales in San Francisco are better than the East Bay, Marin or Santa Clara (counties) but we’ve seen a 10% drop on re-sales lately in higher priced homes. I just sold a home in the Marina for $7.2 million that the seller paid $ 8 million for a few years ago,” confides Nina Hatvany, of Pacific International/Compass.  “ In certain areas like Pacific Heights, if a property is in perfect condition and well-priced, it does sell quickly. Sellers do need to understand we are now in a normal to robust market,” adds Hatvany, San Francisco’s top residential sales agent in 2008-2015 and 2017.

San Jose, Santa Clara County’s largest cityGetty

A red flag to the Bay Area’s market strength is that inventory grew by 21 percent year over year, with almost half of the increase, or more than 1,100 homes being priced below $1 million. Hepp also points to price cuts. “There were more price reductions across the region at all price ranges, with lower-priced homes posting the largest share of reductions in the past three years.”

Good news for buyers? Not so fast, considering the price increases from last year and rising interest rates, impact buyers in the $1 to $2 million range who are feeling affordability constraints. “This price range may see further weakness in the coming months as homebuyers are more aware of the impact of higher mortgage rates and lower mortgage-interest and state-and local-tax deductions resulting from the reforms,” Hepp notes.

The trend of homes selling for premiums over the past three years has been the news story for the Bay Area market. Looks like that’s changing. The largest drop-off in those premium sale prices was in Santa Clara County, which saw buyer fatigue starting earlier in the year. Though according to Hepp’s numbers, “San Francisco, where seven of 10 homes commanded premiums, has not seen a decline in overbids compared with last October.”

Hepp’s bottom line advice to sellers: “They are facing a tougher crowd and may need to adjust their own expectations.” Do keep in mind the Bay Area still has some of the highest priced real estate in the country.

Article source: https://www.forbes.com/sites/ellenparis/2018/11/27/bay-area-buyers-sellers-face-mixed-news/

Google is responsible for the first and second largest land acquisitions in the United States in 2018, according to a report from the San Francisco Chronicle.

(goog) earned the distinction by purchasing the Mountain View, Calif. building that LinkedIn used to call headquarters. The $1 billion deal is also the largest real estate deal in the San Francisco Bay Area in 2018. Google already occupies much of the 12-building, 795,663-square-foot complex known as Britannia Shoreline Technology Park, which has room for roughly 5,000 employees.

The size of the Mountain View space is second only to Google’s other major acquisition across the country earlier this year. In March, Google shelled out $2.4 billion for Manhattan’s Chelsea Market, next door to the company’s 111 8th Ave. offices, an entire city block the search giant snagged for $1.9 billion back in 2010.

While all real estate acquisitions are not created equal, it’s an interesting moment to speculate on why technology giants are seeking a larger physical footprint in the United States, whether for reasons related to office or production space. As has become common for companies including Amazon, Apple, and Google, land buys can ultimately mean big tax breaks by way of incentives such as lower payroll and sales taxes that cities and states offer to lure tech giants to their area.

Apple has also been acquiring more land in the U.S. in 2017 and 2018, nearly tripling its acreage in the past 24 months, according to the Financial Times. Some analysts believe Apple may be building up its real estate portfolio in states such as Iowa, Nebraska, and North Carolina with an eye toward building out data centers and manufacturing facilities, especially if smartphone sales slow.

Article source: http://fortune.com/2018/11/27/google-apple-real-estate-land-acquisition-2018/

Article source: https://www.sfchronicle.com/business/article/Google-pays-1-billion-for-offices-in-biggest-Bay-13422825.php

That old fixer-upper house down the block may have seen better days, but in an environment where new-home prices are on the rise, older homes remain in demand in many markets.

Not only are they potential starter homes for younger families, downsizing options for empty-nesters or properties for investors to rent, but they represent an opportunity for would-be “flippers” anxious to fix ’em up and turn a tidy profit.

A recent report from LendingHome Funding Corporation, a company that provides financing for buyers seeking homes to fix and flip, indicates that from 2014 through 2017, more than 4,400 homes in Fresno County – and more than 8,200 in the five-county Valley region that includes Madera, Merced, Kings and Tulare counties – were sold to buyers who planned to flip them for a profit.

That’s out of a flipping market estimated at almost 152,000 homes statewide over the four-year period, according to LendingHome’s report.

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“We found that, on average, it took about 180 days, or about six months to flip a house in California, which was 20 days faster than the national average,” the report said. Additionally, LivingHome cited research by ATTOM Data Solutions reporting that flips accounted for “5.9 percent of all single-family home and condo sales” in 2017.

LendingHome defines a flipper as “someone who has completed at least one home purchase and resale in a year or less, with at least 10 percent profit, or someone who has purchased and resold at least two homes in 1,000 days or less.”

The collapse of the housing market in the late 2000s, and the resulting economic recession, helped spawn the popularity of flipping as opportunists took advantage of a rising number of financially distressed or foreclosed homes.

Flipping has also been fueled by a slew of do-it-yourself TV shows such as “Flip That House,” “Flipping Out,” “Flip or Flop” and “Masters of Flip,” among others.

More than 25 percent of all California homes purchased for flipping from 2014 through 2017 were in Los Angeles County, according to the LendingHome report.

Fresno County’s flips during that four-year span represented about 2.9 percent of all flips in the state – eighth out of California’s 58 counties behind Los Angeles, San Diego, Riverside, San Bernardino, Sacramento, Orange and Kern counties. It’s enough to prompt LendingHome to dub the county as a “flipping hot spot” in the state.

In Fresno County, the number of home purchases for flips has grown in each of the past four years: 835 in 2014, 1,080 in 2015, 1,214 in 2016 and 1,317 last year.

Madera and Kings counties saw similar four-year growth, while there was a modest dip from 2016 to 2017 in Merced and Tulare counties.

The average revenue on a flip – the raw difference between what a flipper paid for the house and the price at resale – in Fresno County was estimated at about $64,000. That’s before accounting for the costs of material and labor to prepare the house for resale.

Still, homes being sold to buyers who planned to fix them up and sell them at a profit amounted to a relatively small chunk of the overall housing market statewide – about 3.3 percent of all home sales in 2017, according to the California Association of Realtors’ annual housing market survey of buyers for 2017. That’s down from 4.4 percent in 2014.

“In the last few years, the percentage of all buyers purchased their property as an investment to flip has declined, likely because rising home prices made it difficult to make a large profit,” said Lotus Lou, public relations director for the Realtors’ association.

Instead, the vast majority of homes sold – about 82 out of 100 – are still for people to have as their primary residence. Another 9.2 percent were purchased as investment properties to rent, while 5.2 percent were purchased as second homes or vacation homes, the Realtors’ survey said.

Neither LendingHome nor the California Association of Realtors was able to provide a county-by-county breakdown of total home sales to put the flipping market into context on a local scale.

But, the LendingHome report added, “the concentration of flipping activity in some of the wealthiest markets in California – Los Angeles, San Diego and the San Francisco Bay Area, suggests that flippers are not deterred by rising home prices.”

“Instead, they are able to pursue bigger projects that bring in more revenue,” the company’s analysts surmised.

“In the San Francisco Bay Area, for example, with the population boom and limited inventory, house flippers found investment opportunities in the nearby up-and-coming counties of Alameda and Contra Costa,” which both ranked in the top four in California in terms of median revenue per flipping deal.

Article source: https://www.fresnobee.com/news/local/article222027445.html