Number Talk: Bay Area Migration

As you can see from this chart, the Bay Area is experiencing net negative migration, which means more people are moving out every year than moving in. And more and more often, Bay Area residents are migrating just outside the region to adjacent counties. Why?

Well, as you might expect, affordability is the most common concern, and a longer commute is worth the savings on housing costs. But these days, there’s often a lot of two-way traffic, particularly between Alameda and Contra Costa counties.

When they move out of state, Bay Area (and California) residents mostly choose states with no income tax like Texas, Nevada, or Washington, adjacent states such as Arizona and Oregon, or states with major high-tech centers — all of which have much lower costs for housing and basic needs. At the same time, California has some of the highest income tax rates of any state in the country, and the legislature is actually considering increases on affluent residents!

Meanwhile, people moving into the Bay Area come from just about everywhere — including a significant, but declining number from other countries. Please contact the Geek for a full report.

Number Talk: Wildfire Market, Part 2

Last week, we showed you how sales activity in the Bay Area didn’t dip significantly during the recent wildfires, except in the few counties where the fires were concentrated. According to the chart below, listings going into contract in Santa Cruz County fell more than 30% during the height of the CZU complex fire, nearly reaching lows from the peak of the shelter in place.

Meanwhile, things weren’t much better in Monterey, Marin, Napa, Solano, and Sonoma counties, all of which saw huge year-over-year declines in August activity.

Number Talk: Wildfire Market

Surprisingly, the fires did not significantly impact the number of deals being made in most Bay Area counties during the last two weeks of August — with exceptions in Santa Cruz, Sonoma, Monterey, and Napa Counties, which saw declines of 13% to 33%. This chart takes a look at week-by-week activity in the Bay Area.

Number Talk: Impacts of COVID-19 on landlords

If you’re thinking of getting into the rental property market, you should know that COVID-19 is having a significant impact on many landlords, but it’s nowhere near the norm. According to a nationwide survey by the National Multifamily Housing Council (NMHC), 30% of tenants couldn’t pay their rent on time in April, and nearly ¼ of Americans had difficulty paying rent at all.

But it’s worth noting that less than 3% of historically on-time tenants were late or defaulted on their payments. Additionally, renters paying less than $1,000 and over $5,000 per month were more likely to be late or default. This is primarily tenants in service industries with low incomes and students in overpriced rental housing near universities.

Meanwhile, the vast majority of landlords have tenants who are still paying on time, so don’t count yourself out of the rental property market yet!

Number Talk: Sales surge during shutdown

New single-family home sales surged 13.8% to a seasonally adjusted rate of 776,000 in June, surpassing analyst expectations and notching the strongest rate since 2007, according to data released Friday by the U.S. Census Bureau and the Department of Housing and Urban Development. Sales were up from 682,000 in May and 726,000 in 2019, 6.9% above the numbers from last year!