meredith-martin-san-francisco-real-estate-housing-market-rebounds

Can You Guess How Much Home Prices Have Risen Over Last 30 Years in the Bay Area?

Before you do, remember to factor for both the 90s dot-com boom and the general tech boom of the last decade. And whatever your estimate, it’s probably too conservative. Median home prices in the San Francisco Bay Area have risen more than a staggering 500% over the last 30 years. Puts things into perspective, doesn’t it?

Three Counties with Highest Appreciation

As you might expect, the three counties with the highest appreciation were those at the center of the tech booms. San Francisco county rose 532%, Santa Clara county (home to San Jose, Palo Alto, Stanford University, and Mountain View) rose 513%, and San Mateo (just south of San Francisco) rose 506%, though all the counties in the area appreciated as well.

What about the dot-com burst in 2001? Some markets did dip, but other counties weren’t affected at all. It was the subprime mortgage crisis a decade later that would cripple the lower end of markets across the region, but the recovery was steady. Between 2012 and 2020, median home prices would double in the same three counties.

And then came the pandemic, which amounted to rocket fuel for home prices. Since spring 2020, median home prices in San Mateo have risen by 32%, in San Clara by 31%, and in San Francisco by 20%. In San Francisco — on the low end, in this group — that’s equal to an increase of $200,000.

And then there are the luxury homes, which are in a category all their own. They’ve surged disproportionally since the beginning of the pandemic, which is a factor in sky-high median home prices.

The Takeaway

Paying attention to price increases (or decreases) over time can help you forecast if you are “overpaying” or not in a competitive bidding environment. Anticipating how long you may hold a property over time can also help you estimate if buying a home in the competitive Bay Area is a sound financial decision or if you’re better off continuing to rent.  

Purchasing real estate can be one of the best financial decisions you make or it can end up being an anchor tying you to a location you no longer want to be — not to mention a money pit. That’s why you need a real estate agent who has been through and navigated both good and terrible markets, who understands the gravity of the decision you are embarking on — particularly if you are doing this for the first time — and who can help you troubleshoot the advantages and pitfalls of each line of thinking, knowing that if you’re unhappy with your purchase, whatever the reason, it will ultimately color your feelings about the agent that helped you get there. It’s always worth finding a great agent. You’ll never be sorry you put in the effort to do so.

If you are looking to buy or sell in the San Francisco Bay Area (Peninsula, Marin, East Bay and San Francisco) or the Reno, Lake Tahoe areas, you know where to find me! 

Leave a reply:

Your email address will not be published.

Site Footer