http://www.bizjournals.com/sanfranc...09/san-francisco-unaffordability-housing.html
San Francisco has reached 'peak unaffordability'
Sep 22, 2016, 6:53am PDT Updated Sep 22, 2016, 9:16am PDT
Riley McDermid Digital Producer San Francisco Business Times
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San Francisco has now reached "peak unaffordability," Trulia says.
Photo by Bloomberg
San Francisco’s real estate market has reached 'peak unaffordability,' says a housing expert, which will lead sellers and landlords to lower prices on housing and offer tempting perks for rentals as they scramble amidst a glut of supply and record-high prices.
San Francisco-based Trulia Chief Economist Ralph McLaughlin made the comments in an interview with Yahoo Finance.
“Your average buyer can’t afford a home,” McLaughlin explained. “As buyers pull back because of price-induced reasons, there is less competition for homes, and so price growth moderates.”
McLaughlin also points out that both real estate prices and rents have fallen year-over-year, from 15 percent to 17 percent growth in 2015 to 5 percent to 6 percent growth this year, a trend which will continue as the region deals with a glut of new units on the market. That includes 12,300 new rental units in Oakland, San Francisco and San Jose, a huge jump from 7,000 units in 2015.
Landlords are offering everything from free bikes to up to six weeks free rent just to fill up their inventory, as the Bay Area continues to struggle with finding a balance between market demand and what people can actually pay. That's what's led the region to be the nation's most expensive area to live in, according to Trulia, with the median rent in San Francisco weighing in at $4,500 a month.
“You wouldn’t be incorrect to say the [San Francisco Bay] area is ‘weird,’” McLaughlin said in the interview. “San Francisco alone has gained more for buying a median-priced home than the 10 slowest-growing markets in the last 30 years combined. Thirty years ago, it was slightly more expensive than the rest of the country. Now it’s a lot more expensive. So we’ve really seen the Bay Area move and become further outliers than they were just a few years ago.”
San Francisco has reached 'peak unaffordability'
Sep 22, 2016, 6:53am PDT Updated Sep 22, 2016, 9:16am PDT
Riley McDermid Digital Producer San Francisco Business Times
Enlarge San Francisco has now reached "peak unaffordability," Trulia says.
Photo by Bloomberg
San Francisco’s real estate market has reached 'peak unaffordability,' says a housing expert, which will lead sellers and landlords to lower prices on housing and offer tempting perks for rentals as they scramble amidst a glut of supply and record-high prices.
San Francisco-based Trulia Chief Economist Ralph McLaughlin made the comments in an interview with Yahoo Finance.
“Your average buyer can’t afford a home,” McLaughlin explained. “As buyers pull back because of price-induced reasons, there is less competition for homes, and so price growth moderates.”
McLaughlin also points out that both real estate prices and rents have fallen year-over-year, from 15 percent to 17 percent growth in 2015 to 5 percent to 6 percent growth this year, a trend which will continue as the region deals with a glut of new units on the market. That includes 12,300 new rental units in Oakland, San Francisco and San Jose, a huge jump from 7,000 units in 2015.
Landlords are offering everything from free bikes to up to six weeks free rent just to fill up their inventory, as the Bay Area continues to struggle with finding a balance between market demand and what people can actually pay. That's what's led the region to be the nation's most expensive area to live in, according to Trulia, with the median rent in San Francisco weighing in at $4,500 a month.
“You wouldn’t be incorrect to say the [San Francisco Bay] area is ‘weird,’” McLaughlin said in the interview. “San Francisco alone has gained more for buying a median-priced home than the 10 slowest-growing markets in the last 30 years combined. Thirty years ago, it was slightly more expensive than the rest of the country. Now it’s a lot more expensive. So we’ve really seen the Bay Area move and become further outliers than they were just a few years ago.”
