Blogging Bayport Alameda

January 10, 2018

Demand driven

Filed under: Alameda — Lauren Do @ 6:00 am

This was published last December, but wanted to get it up anyway since we’re typically discussing the housing crisis from the point of view of folks who are more vulnerable.  Here’s the look from the other end of the spectrum which ultimately affects those who are more vulnerable.  From the Mercury News:

There are 42 percent fewer premium homes available in San Jose today than at this time last year — the biggest drop among U.S. cities studied, according to real estate website Trulia. Experts say the disappearance of those high-end homes means higher prices and tougher competition for all homebuyers, not just those in the market for Silicon Valley’s priciest mansions.

“The biggest single factor that determines pricing or value of a home is supply and demand,” said Rick Smith, president of the Santa Clara County Association of Realtors. “If inventory is tiny and there is a demand for properties to be purchased in any given area, the demand will drive the prices up.”

And a low supply of top-tier homes drives up prices across the market — not just for the Bay Area’s elite, he said. Most people in the market for a premium home are shopping because they’re selling a less-expensive starter or trade-up home, Smith said. If they can’t find what they’re looking for, they don’t sell their cheaper home — depriving the market of a more affordable house. To make matters worse, premium homebuyers who can’t find a top-tier home also may “cannibalize” a cheaper home, thereby snatching it away from lower-income buyers who can’t afford to pay as much, said Young.

Look I know it’s hard to feel too much empathy for those with enough money to afford a $2.5 million home, but the reality is what was pointed out by the person quoted above.  It’s not those people that won’t have a place to live, they can either stay put or buy a much cheaper home that someone will less income could afford — although going head to head against an all cash buyer or someone who is willing to bid up considerably is a non starter for those with shallower pockets.

 

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9 Comments »

  1. I view a growing shortage of luxury homes in an urban area with available land as a good sign. Land and financing that previously would have gone toward luxury homes is now supporting the construction of multi-family homes. Similarly, the reduced cap on the home mortgage interest deduction will reduce government subsidies of luxury homes and redirect financing toward less expensive homes.

    Comment by 2wheelsmith — January 10, 2018 @ 7:49 am

    • That’s not what’s happening. Did the article say anywhere that multifamily homes are being built in lieu of luxury homes? That’s a really odd and incorrect leap of logic to make.

      Comment by Lauren Do — January 10, 2018 @ 8:39 am

  2. Yeah, really not happening, 2wheelsmith. A recent sale…

    267 Camino Al Lago, Atherton, CA 94027 6 beds 9 baths 11,278 sqft SOLD: $39,990,000 Sold on 12/20/17
    Zestimate®: $40,062,033 EST. REFI PAYMENT $150,493/mo
    See current rates
    Circus Club location in Las Lomitas School District in the Heart of Atherton!! Rare 1.9 acres! Build a large Estate home or update the existing home and add tennis court, cabana, and guest house! Beautiful perimeter trees and long driveway afford privacy and easy use of the land. Existing home was custom built in 1963 with Clear-heart Redwood interiors and expansive windows. This Contemporary Ranch-style home was ahead of its time with an open Kitchen and Family Room with Eating Area and Raised Hearth Fireplace, separate Dining Room, large separate Laundry Room, expansive Master Dressing Room and Bath, Pool, and Artist’s Studio. Property is being offered as land value; home is being sold as-is.

    Comment by vigi — January 10, 2018 @ 10:42 am

  3. For the most part, the same people that have been crying about the high cost of housing have been the very same people protesting and obstructing the building of new housing. These left-wing quacks have erected pages of regulations to prevent the building of new housing (environmental controls), and have been quick to find fault with any new affordable housing based on appearance, location, and any number of stupid reasons. With the obvious results. Obvious to everyone but a brainless liberal.

    When the Naval Base closed almost 20 years ago, we freed up almost a third of the Island. I was licking my lips and looking forward to moving into those new houses with spectacular views of San Francisco and the Bay. But NOOOOOOOOOOO. During the fight between the city and the Navy over site contamination, the Least Tern (an obnoxious bird) started nesting on the runways. Soon this poor endangered bird and 624 acres of prime location on our Island become a wildlife sanctuary and nature preserve, and a Columbaria ( a fancy name for a cemetery for cremated remains). Are you kidding me? This is total lunacy. Take a look at the map of our island. A third of it is fricking empty and will be for the foreseeable future. And yes, I kissed my room with a view goodbye. The Audobon Society wins again. The liberals were happy that the evil developers had been beaten back in Alameda.

    And then something obvious to anyone with a brain, happened. The loony left, which continues to view developers as the enemy, as well as building new housing as deplorable (not my word, but loser Hillary’s) began to notice they had shot themselves in the foot.

    As supply decreases, demand increases, and these liberal clowns watched the rents and house prices go sky high. Suddenly all the brown and black people start disappearing. Soon the artists and poets, teachers and liberal art degree holders that the left calls friend, started crying. Capitalism sucks! So our city leaders institute rent control. And set up a huge department at city hall to run the rent control operation, and bill the landlords for this wonderful service. You can not make this stuff up. And the Least Tern struts under the city lights of San Francisco.

    And one of the most vocal proponents of rent control and the little guy, wonderful Jim Oddie along with his fellow left wingnuts just vetoed the 589 unit Encinal Terminal project. The left wingnuts have a majority on the council. They hate new housing. They hate high rental rates. They hate landlords and developers and love Rent Control. Elections have consequences said the Inconsequential One. Please remember this in November.

    “Over and over, we have watched affordable housing get slowed down and scaled back in the name of ‘neighborhood character,’ ‘traffic’ and fear of ‘ugly’ housing. But segregation, homelessness, and a chronic housing shortage are ugly. And that is what we are dedicated to changing.” This applies ONLY IN THE MOST LEFTWING REGIONS of the country.

    https://www.bizjournals.com/sanfrancisco/news/2018/01/09/sf-affordable-housing-opposition-development.html

    Comment by Alameda Landlord — January 10, 2018 @ 3:29 pm

    • that was hard to read, made no sense, and showed a total lack of understanding how the base could be developed. I thought it was “Crooked Hillary”, not loser Hillary. don’t forget , this is the Left Coast, some of us just love it here.

      Comment by JohnP.TrumpisnotmyPresident. — January 10, 2018 @ 3:41 pm

  4. Alameda Landlord for Mayor.

    Comment by Jack — January 10, 2018 @ 5:02 pm

  5. And JohnP Trump for master of the left arm.

    Comment by Jack — January 10, 2018 @ 5:14 pm

  6. Just to clarify a few things: Alameda NAS closed in 1997, more than 20 years ago. Anyone thinking that land was “freed-up”, wasn’t paying attention, and had a simplistic idea of how easy it would be to convert the land to civilian use. Unfortunately, some of them were developers who oversold the potential of contaminated land to the public. The Least Tern actually established residency on the airfield while the jets were still using it. They didn’t seem to mind the planes, so the no-fly zone now doesn’t make much sense, The greatest threat to the least terns now seems to be the other birds –raptors- which prey on them, and which have moved in since the planes left,

    The Federal government was always going to get a large swath of the land anyway. When the locals in their stupidity voted against a VA hospital, they got a burial ground instead. Now local liberals are clamoring for more jobs in Alameda. Which would have provided more jobs: a hospital or a columbarium? The answer should be obvious. Alameda shoots itself in the foot again

    Comment by vigi — January 10, 2018 @ 6:36 pm

    • We did get one new building so far (I not sure when it will be completed). I to think it is stupid idea to build a columbarium there and a hospital would have been a better choice (first time I agreed with vigi). I am a veteran and if given a choice I rather have my ashes it someone want to keep them in the Presidio but I actually don’t care. I do want to be cremated but to me it not important what they do with my ashes. I seen my mom’s grave once since she died and have never seen my dads or grandparent’s grave. In 10, 20, 30 years who cares really the people who loved you also died. Why not give space to the living instead of the dead.

      Comment by joelsf — January 11, 2018 @ 8:14 am


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