Tech jobs, lack of new housing supply lead to ‘feeding frenzy’

[KamaAina]

http://blog.sfgate.com/ontheblock/2015/03/26/tech-jobs-lack-of-new-housing-supply-lead-to-feeding-frenzy/

The closer a home is to tech jobs in San Francisco and Santa Clara the more likely it is to sell quickly and for over asking, according to a new report from Paragon Real Estate. “The white-hot—some would say overheated—core of the Bay Area homes market is San Francisco and Silicon Valley, and the heat radiates out from there, diminishing as one gets further away,” according to the report. “This core is defined by the incredible strength of the economy, much of it supercharged by the high-tech boom.”

Paragon found that in February 2015, 91% of homes in San Francisco sold without a price reduction, versus 86% in San Mateo, 82% in Alameda, 76% in Marin, 75% in Contra Costa, 67% in Santa Clara, 67% in Sonoma and 65% in Napa. Throughout the Bay Area, the homes that did sell without a price reduction generally averaged sales above the asking price. Again, San Francisco led the way with an average sales price 11% over asking. For example, the Liberty Hill condo featured in the gallery above, which touted its proximity to “every tech bus,” came to market at $1.395 million on January 22. It was in contract eight days later and sold for $255K over asking.

S.F. was followed closely by San Mateo (8% over asking), Santa Clara (7% over asking) and Alameda (6% over asking). Marin, Contra Costa and Sonoma sold only 1-2% over asking, on average, and Napa actually sold at 2% under asking, on average. ”As one gets further north, east and south of the inner core, the markets become less overheated: It’s not that these markets are weak—in fact, some are quite hot and they’ve all been strengthening for the last 3 years. It’s simply that they’re not characterized by a feeding frenzy of almost overwhelming demand meeting limited inventory,” Paragon reported. “Except for sellers eager to maximize their homes’ sales prices, that’s not necessarily a bad thing.”

The same dynamic played out when Paragon looked at the average number of days a home was on the market before a sale. San Mateo had the lowest number of days, with homes going into contract an average of 18 days after coming to market. Santa Clara, Alameda, Contra Costa and San Francisco were all just days over that average. But Marin’s average was 40 days, followed by Sonoma at 54 days and Napa at 79 days.

[rafeh1]

1. according to the doom and gloomers

according to the doom and gloomers last one out of california to turn out the lights

Looks like our cali is doing great