Hi Cornell RE community! My name is Chris Cook and I am a Realtor in Marin County, CA. My company (Golden Gate Sotheby’s International Realty) puts out market reports every month and this month’s Bay Area report was especially interesting to me and worth a read if you are thinking about participating in the real estate market. This report covers some of the effects of COVID-19 on metropolitan vs suburban areas and explains the bifurcating market trend that has emerged in recent months. Below I have written a brief synopsis of the report and highlighted some important points that apply to the broader residential market.
Starting with the broader economic outlook, signs of a recovery continued, but with constant trepidations. There has been a steady increase in hiring due to the general relaxing of COVID restrictions; but these gains have been limited by the lingering effects of indoor-only business. While some industries continue to suffer and unemployment remains high, the stock market surged since March and mortgage rates fell to record lows, allowing some households to harvest portfolios and take advantage of uncertain sellers. Buyers with secure balance sheets will continue to prioritize lower density areas and homes conducive to remote working for the foreseeable future, leading to some variation in performance by neighborhood and geography. This bifurcation of the market is most clearly seen when comparing high population density counties like San Francisco and Solano Counties with those with more space like Marin, Contra Costa, or Santa Cruz counties. In Solano County, one of the most affordable housing markets in the Bay Area, sales activity increased by the smallest amount of any county in July. Compared with the previous July, sales were lower. In contrast, luxury sales accelerated in July by 20% from June and 53% from last July, reaching the highest level in more than three years. The inventory of for-sale homes remained limited even in these high-priced areas, leading to multiple bid situations for many listings. High demand for luxury properties, as well as low inventory across the market, has led to many suburban and rural homes selling above original list price.
Christopher Cook is a 2015 grad of Cornell University with a Bachelor of Science (B.S.) from the Charles H. Dyson School of Applied Economics and Management specializing in finance.
Note: This research was originally published by Sotheby’s International Realty – Golden Gate and has been posted with their permission.