> It should be noted that San Francisco had an unusually low inventory relative to other large cities prior to the pandemic. Historically, the ratio of homes for sale relative to total housing has been a quarter of New York's.
But then they go on to assert that this is important regardless, but don't actually provide any information to back it up.
> Regardless, the 96% year on year change in inventory marks a significant moment.
I would assume if it was so self evident, it would be easy for them to include even a sentence that alludes as to why.
They say other nearby markets don't see the same shift but other nearby markets were never like SF anyway, so I'm not sure why they would indicate something in a market already known to be dissimilar.
Edit: I and the parent comment were referring to the SFGate article from another submission that got merged I to this one, as we were before the merge.
Conversely, if you're a building manager and you an X% occupancy rate target, you're going to need to cut prices in order to maintain that rate if a bunch of tenants don't renew.
This is pretty much textbook microeconomics 101.
Going a bit further, occupancy rate is a signal that both sides of the market can (noisily) observe, so if the prior non-occupancy rate was very low, you'd expect a shock that doubles the rate (say, 5% -> 10%) to lead to perhaps a larger price change than in a less tight market (such as 10% -> 15%)
The premise I was responding to is that noting change in inventory will show much larger swings if there's relatively few units on the market, and that may be a poor indicator of what's going on.
Simplified, it's the difference between a market of 100 units of this 10 are avaiable inventory, and seeing an increase of 3 units (30% raise in available inventory) and a a market of 100 units that has 1 unit available and sees an increase of 2 units (200% increase in available inventory). There was an increase in inventory, and it helps, but probably not as much as 200% would lead one to believe.
The article itself noted the latter was the case in SF as there was "unusually low inventory" compared to other cities beforehand. Of course the difference is going to look outsized, in that case.
> if the prior non-occupancy rate was very low, you'd expect a shock that doubles the rate (say, 5% -> 10%) to lead to perhaps a larger price change than in a less tight market (such as 10% -> 15%)
That depends on so many other factors that I think you can't easily generalize like that for housing. If the inventory is still very low, and now instead of being uber-rich you just need to be very-rich, you're still so constrained in your potential customers that the price range may not change significantly, or if you're still catering to a class of people that do or don't traditionally commute, or if the price is hovering near the break even for a lot of people for commuting vs living local, or whether the work in the area that many of the potential customers does can be done remotely (as these articles are about), etc. Housing is one of the most complicated markets, and there are numerous counterexamples of the exact opposite happening to what you describe
One example, it makes more sense to give someone 3-6 months free at price $X than to get them in at .5 or .75 $X.
It depends on the landlord. If they were reasonable, then yes, I'd bargain with them. If they were total pricks for most of the time I was there, then screw them. I can get my lower rent and hurt them in the process. I'll try that option! (At least, I bet that's the thinking of many people.)
That said, a lot of folks in SF are on month-to-month leases so they can just give a 30-day notice and peace out.
Bingo
Its a delta of a delta
I like the ones that show rent and pricing drops more
This chart is an additional footnote but not one to make an article about in isolation
I think this is key right here. For the foreseeable future, those things won't be any more available in an expensive city compared to an inexpensive rural area. So why buy a 1 bedroom for $2 million or rent one for $3500 a month if I can do the exact same amount of networking and see the exact same amount of museums while paying significantly less?
One example for instance is the vast amount of unique natural beauty surrounding the Bay Area.
Even rural places that have that are also expensive- though admittedly not nearly as much so. This is generally reflected in salary though.
But that's not what you move to most cities for. SF may be exceptional in having that stuff as well, but for most cities, if you lock down the social/cultural aspects, then the natural beauty is elsewhere.
Basically, the optimal solution right now is to not go anywhere or see anyone unless you absolutely have to. Which if all someone should be doing is sitting at home or getting groceries, they could do that for a lot less than SF prices.
Outside of a few extremely popular spots it is not restricted in Washington, at least to my knowledge. If it is in the Bay/CA then it is news to me.
In any case, that stuff will still be there when the pandemic is over. It won’t be anywhere east of the Rockies.
On trails with 90+F weather you have to put your mask on every 30 seconds with how many people there are, it's a mess.
My mental health is not improving when there are a million people all trying to do outdoor activities in the limited space we have nearby.
In my experience, you bring a mask with you when you hike, and occasionally put it on for maybe twenty seconds out of every five or ten minutes (or even rarer intervals when hiking in the more remote areas like the national parks) when you pass by someone on a trail and can't maintain distance. You hardly ever have to wear it.
And aside from this past weekend, it hasn't cracked 90 in the Bay Area pretty much all summer IIRC, and rarely even gets over 80.
What's strange about now is that the little neighborhood walks that lead down to beaches and other "hikes" like that are completely packed with people at all times, especially on weekends. It's actually to the point where people are parking multiple blocks away and then walking to the trailhead. It didn't used to be that way.
Otherwise, your point about there still being plenty of healthy ways to get out of the home, both practically and in accordance with official guidelines, is well-made.
The local paper ran a story saying that the median house price in the city proper went up $15K in one month[1] and wages are not budging. 84% of the city is zoned for single family homes. Downtown pre-lockdown had 80K cars fighting for 18K parking spots.
I live in a one bedroom penthouse Downtown for $2K a month. I don't have care. It's only the 7th floor though, and on a 5 lane highway that the city has asked the state to narrow (the state refused)[2]. It's very loud from the red state types driving through with big diesel trucks and obnoxious motorcycles.
Most of the metro treats Downtown Boise as a parking lot[3]. The largest private land owner downtown is the power company (for parking lots)[4]. And the nature outside the city requires driving hours in a place that desperately needs less traffic pollution and more transit.
I'm pretty set on decamping to Boston soon to be in real tower in a city with transit.
[1] https://boisedev.com/news/2020/08/12/boise-idaho-home-sales-...
[2] https://www.idahostatesman.com/news/local/community/boise/ar...
[3] https://www.idahopress.com/news/local/eagle-narrows-where-ap...
[4] https://boisedev.com/news/2020/07/28/idaho-power-plans-to-co...
I have worked 100% remotely for almost two years now and love it but now I live somewhere with a crappy job market. Yes I save money but I live in constant fear of having to take a 50% pay cut if I can’t find more remote work.
I love working remotely and I think it’s a great idea but I don’t think people realize how much of a leash it is when you choose to work in SV but live in the middle of nowhere.
But isn't the point of the article that San Francisco specifically is seeing an exceptional exodus? The story even mentions San Jose as a regional counter example to the observations being made of SF.
It is obvious from the charts that something unusual happened in SF. But that is different from it being sustained, not about to reverse or even important. The dust hasn't even finished rising from COVID-19 yet, let alone settled. And it isn't even clear this is COVID-19 related.
But way too early to tell, I'm still never expecting to move back there.
I imagine people at the fringes in the city (and region really), born and raised, with local family ties making it harder to leave, might feel that this "bad spot" appeared some time ago.
Proximity to people may be something that loses appeal in the medium term.
This is a suspicion rather than anything that can be evidenced yet, we'll see how it plays out, but I think it might start counting as a negative, or less as a positive, for a while.
But secondly, that's not really what I meant, I meant that for the next several years people's motivations and choices are likely to be impacted by the virus. This may result in a larger percentage of people moving away from cities or choosing not to move to them.
i.e. I'm not talking about an individual holding the thought in their head that "I don't want to be in a city, in the medium term, but may move back later", but a population which is less favourable to city life in the medium term, and holds a greater proportion of people who think "I don't want to live in the big smoke at all"
I may be wrong, of course, but I think we're already seeing it to a small extent.
Maybe one day the media will be forced to change for the better of society!!! As of now too many people are sheep to it (all sides)... I find local media in my small town city to be much more digestible and better for society.
It seems plausible that SF already had such low inventory numbers that any change would look huge on a chart like this, though that doesn’t appear to be the case in the other highly competitive markets seen here. I’d love to see the actual monthly figures... maybe it’s true that there’s an exodus afoot, or maybe SF was that much worse off from an inventory perspective until now.
It also seems plausible that SF has a unique combination of factors that put it in a bad spot right now. It’s insanely expensive, quality of life has been on the decline for some time, and the types of companies that made real estate there so expensive in the first place are also likely to be the ones that adopt remote work quickly and wholeheartedly.
SF aside, my best guess at this point is that many American cities are and will continue to actually see some amount of people leaving for lower cost and more spacious markets, especially if remote work optionality sticks in the way it looks like it will. But cities have enduring appeal - proximity to people and culture and things to do is just as much a factor as proximity to work. I think any exodus we see in most markets will amount mostly to a pull-forward of people who would have left cities anyway because of life stage, but did it a year or two early if they could.