It’s common knowledge by this point that the Bay Area housing market is among the hottest in the world, with The Mercury News citing the uninterrupted streak of housing price increases since April 2012. However, the same report states that since March 2019, the market has seen prices dip year-to-year over several months, leading some to wonder if the market is starting to cool off.
Prices Still Among the Highest in the Nation
While the Median Sales Price in the Bay Area dropped 4.7% to $810,000 despite favorable market conditions, it’s worth noting that the home prices in the Bay Area housing market still rank among the highest in the nation. The median sales price is more than three times that of the national average, which Zillow lists as $289,000.
Why the Drop?
If the market is still so healthy, why then are prices starting to drop? The Mercury News chalks this up to the simple fact that buyers are now willing to wait for the right deal rather than get into bidding wars. Even if this is the case, it’s noted that job growth is still strong, with 5100 jobs added in August alone, meaning the demand is still there. It’s just that young professionals are being more cautious about their budgets, although it’s still a seller’s market rather than a buyers’ market.
Not Affecting Silicon Valley
Even if prices in the Bay Area are starting to fall, Silicon Valley prices remain as robust as ever, even if recent headlines suggest prices are falling somewhat. According to CNN, the reason housing prices may seem like they’re cooling off in the area is due to a population churn, with more and more baby boomers cashing out on their properties, which have sky-high values. This has led to a brief increase in inventory as more homes come onto the market, but they remain as pricey as ever. According to a recent write-up in Vox, the median home price still runs a whopping $1.6 million!