What Are Silicon Valley’s Highest-Paying and Most In-Demand Tech Jobs?

  • Directors of product management are Silicon Valley’s best-compensated tech workers, earning average annual salaries of nearly $187,000.
  • Software test engineers are the most sought-after employees in Silicon Valley in 2018.
  • For the second year in a row, Apple is the most active hiring company of tech workers in the region.

Apple headquarters in Cupertino, California

Tech-job openings in Silicon Valley have risen by more than 10 percent year over year in 2018, and while engineers are some of the industry’s best-compensated workers in the region, they do not take home the largest salaries.

That’s according to an analysis by job portal Indeed, which examines tech-industry job openings, salaries, and company hiring activity in Silicon Valley from November 2017 to November 2018. The report says that tech-job listings in the region increased by 12.9 percent over the past year after declining by 5.4 percent the year before that.

Half of the 20 most in-demand jobs in America’s technology hub seek engineers and developers, with software test engineer at the top of the heap. Java is the most often listed skill, appearing in 27 percent of Bay Area tech job advertisements, followed by Python (25 percent), and JavaScript (18 percent).

Similarly, engineering jobs account for nearly half of Silicon Valley’s 20 best-paying vocations, with annual salaries ranging from $181,100 to $148,098. But the highest-compensated workers in the region are product-management directors, who pull in average annual wages of $186,766 thanks to their blend of technology and business skills.

For the second year in a row, Apple is Silicon Valley’s most active hirer of tech talent in 2018, with jobs at the firm accounting for 4.2 percent of all postings in the industry. The top 20 companies who are seeking the most tech workers include most of the Bay Area’s usual suspects, including Google, Facebook, Oracle, Salesforce.com, and eBay.

Customer-relationship-management software giant Salesforce.com is hiring for the most tech roles in San Francisco proper, followed by Amazon.com and Twitter. In San Jose top hirers include Cisco and PayPal, while Pandora and Marqeta are two of the most active in Oakland.

Regardless of their chosen industry, Californians who prioritize their careers will find a lot to like in the Bay Area. Earlier this month, rankings from WalletHub put 16 Bay Area cities among the state’s 20 best job markets, with Contra Costa County’s San Ramon coming in at No. 1. And according to the latest numbers from the California Employment Development Department, seven of nine Bay Area counties boasted unemployment rates of less than 3 percent in October.

(Photo: iStock/NicolasMcComber)

_______
Shared with permission from the Pacific Union Blog

Bay Area Housing Inventory Again Posted a Solid Increase in November

Executive Summary:

  • Overall Bay Area home sales (single-family homes and condominiums) declined by 17 percent year over year in November, with all counties and price ranges posting decreases.
  • Year to date, total 2018 sales are 5 percent below last year; however, sales of homes priced higher than $1 million are still trending above 2017 levels.
  • Some communities — particularly Marin County’s San Anselmo and a few others in San Mateo and Contra Costa counties — continued to post more sales compared with last year.
  • Inventory jumped by 27 percent year over year in November, with homes priced below $1 million up by 27 percent, homes priced between $1 million and $2 million up by 39 percent, and homes priced above $2 million up by 9 percent.
  • The Bay Area’s median home price appreciation slowed to 3 percent on an annual basis, the least growth since August 2016. Home prices in Sonoma County posted a 5 percent decline due to more lower-priced sales.
  • Buyers of affordable homes responded the most to changing market dynamics. Price reductions increased by 16 percentage points, from 16 percent last year to 32 percent this year, mostly for homes priced below $1 million in Santa Clara and Sonoma counties.
  • Most of the inventory increases and price reductions were in areas that lack access to employment centers and transit corridors.

The rebalancing of Bay Area housing markets that started several months ago continued in November, with buyers taking a notable pause. However, with extra inventory on the market — especially in the more affordable price range — cooling competition, and more price reductions, buyers are seeing more opportunities heading into 2019.

Overall Bay Area home sales declined by 17 percent in November, with all counties and price ranges posting drops from the same time last year. Table 1 summarizes November year-over-year changes in home sales by price range and county. While sales were generally down, a few bright spots remain in Alameda County’s $1-million-to-$2-million range and in both East Bay counties for sales over $3 million. There were about 940 fewer Bay Area home sales compared with last November, with more than 70 percent of the decrease for homes priced below $1 million.

Table 1: November year-over-year change in home sales by Bay Area county

Source: Terradatum, Inc. from data provided by local MLSes, Dec. 7, 2018

Year to date, total 2018 sales are 5 percent below last year, though sales of homes priced higher than $1 million are still trending above 2017 levels. Table 2 summarizes the changes in total year-to-date sales by price range and Bay Area county. Of the nearly 3,000 fewer sales compared with 2017, almost half is due to declines in Santa Clara County and mostly for homes priced below $1 million. Sales of homes priced above $1 million made up for some of the losses below $1 million, mostly due to price growth moving from below $1 million to above $1 million. San Francisco is the only Bay Area county where 2018 sales are outpacing 2017 levels.

Table 2 also illustrates 2018 year-to-date percent changes in sales compared with 2017 and 2016. While 2018 sales are closer to 2016 activity — only 2 percent below — some areas, such as Alameda, Marin, and San Francisco counties, are still trending above 2016. However, Napa and Sonoma counties show the biggest declines compared with 2016, which could be driven by the impact of the October 2017 wildfires. For more on the impact of last year’s wildfires on Wine Country housing markets, refer to this recent analysis.

Table 2: Year-to-date change in home sales and percent change compared with 2016 and 2017 by Bay Area county

Source: Terradatum, Inc. from data provided by local MLSes, Dec. 7, 2018

Furthermore, while a county-level analysis might provide an idea of general trends, it’s important to note that recent sales declines varied among local cities. Also, in looking at three-month (September to November) changes compared with the same period last year, there were some areas with notable increases in sales. Table 3 shows the 10 Bay Area cities (those with at least 30 sales in 2018) that posted the largest gains over the last three months compared with the same period in 2017, as well as those with the largest declines. Marin County’s San Anselmo stands out with the largest increase in sales over last year, along with other cities in San Mateo and Contra Costa counties. Cities that saw the largest declines were more widely geographically distributed across the Bay Area.

Table 3: Bay Area cities with the largest annual home sales increases and declines, September through November

Source: Terradatum, Inc. from data provided by local MLSes, Dec. 7, 2018

With buyers taking a pause and sellers believing that now is a good time to list their homes, inventory has improved significantly over the last few months, with a 21 percent year-over-year increase in October and a 27 percent annual increase in November. However, looking at the overall Bay Area, average inventory in 2018 is still on par with 2017 and 8 percent below 2015 and 2016 levels. Figure 1 illustrates inventory levels in November over the last three years. Note that while November 2018 levels certainly outnumber last year’s supply, in some markets, 2018 is only slightly above or at 2016 levels. Thus, even with inventory increases, Bay Area housing markets are still historically undersupplied.

Figure 1: Inventory of homes for sale by Bay Area county, November 2016, 2017, and 2018

Source: Terradatum, Inc. from data provided by local MLSes, Dec. 7, 2018

However, improved supply levels are a welcome turn of events for buyers. Figure 2 summarizes November year-over-year changes in inventory by price range.  While Santa Clara County outpaced all others for inventory gains compared with last year, average monthly 2018 inventory is still 16 percent below 2015 and 2016 levels. This is also the case for all Bay Area counties except Sonoma, where average 2018 inventory has outpaced 2016 by 4 percent.

The inventory of homes priced below $1 million increased by 27 percent year over year in November across the Bay Area. The largest increase was for homes priced between $1 million and $2 million, up by 39 percent, with Santa Clara County contributing 50 percent to the added supply. The inventory of homes priced above $2 million increased by 9 percent, again due to Santa Clara County.

Figure 2: Year-over-year changes in inventory by Bay Area county and price range

Source: Terradatum, Inc. from data provided by local MLSes, Dec. 7, 2018

For buyers looking for an opportunity, it is helpful to see where most of the new inventory is available. The heat map in Figure 3 illustrates three-month (September through November) supply changes at a ZIP-code level, with declines shaded in red and increases ranging from orange to green. Green shades suggest an inventory increase of more than 50 percent. Note that for some small ZIP codes, a gain from one to two homes for sale equals a 100 percent increase.

It is interesting to note that many red areas are still present, suggesting that inventory is below last year’s levels, especially in some East Bay areas that benefited from fast home price growth over the last few years. Also, areas accessible to San Francisco, such as southern Marin County, continue to lack supply. Generally, more inventory has become available in areas relatively farther from employment centers and transit options.

Figure 3: Inventory changes by Bay Area ZIP code

Source: Terradatum, Inc. from data provided by local MLSes, Dec. 7, 2018

At a city level, Table 4 captures the 10 local cities (those with at least 30 sales in 2018) with the relatively largest increases in inventory and the relatively largest declines. Again, while five of the top 10 cities with the biggest gains are in Santa Clara County, the others are in the East Bay and Marin and Sonoma counties. However, Milpitas, which had the biggest increase in inventory, also ranks as the top city for sales increases. Thus, while at a slower rate than seen in previous months, buyers are taking advantage of the new inventory. Similarly, Clayton and San Anselmo also rank in the top 10 for both supply and sales gains.

Newark, on the other hand, saw more inventory but ranks in the top 10 for cities with the largest declines in sales. Lastly, Los Altos ranks among the communities with the biggest declines in both inventory and sales.

Table 4: Bay Area cities with the largest annual inventory gains and declines, September through November

Source: Terradatum, Inc. from data provided by local MLSes, Dec. 7, 2018

Median price growth also reacted to changes in the homebuyer and seller dynamic, with the increase slowing to 3 percent year over year in November. Prices last grew by 3 percent in August 2016. The slowing growth comes amid an average 16 percent gain seen in the first half of the year, thus still putting 2018 year-to-date prices 12 percent above 2017. The most notable trend change is the decline in Sonoma County’s median price, which decreased by 5 percent from last November; however, it’s important to note that the share of homes priced below $1 million increased from 83 percent of all homes last November to 89 percent this year. The change in the sales mix could be contributing to lower median home prices in Sonoma County. Table 5 summarizes median prices by Bay Area county, year-over-year change in November, and 2018 year-to-date change.

Table 5: Year-over-year and year-to-date median home price changes by Bay Area county

Source: Terradatum, Inc. from data provided by local MLSes, Dec. 7, 2018

Lastly, as inventory rises and home price growth slows, competition has begun to ease, and more homes sold below the asking price, suggesting that buyers have more negotiating power than they did at the same time last year. The share of homes that sold at a reduced price increased by 16 percentage points, from 16 percent last year to 32 percent this year. Increases in price reductions were mostly for affordable homes — those priced below $1 million — and mostly in Santa Clara and Sonoma counties. In Santa Clara County, one in 10 homes below $1 million sold at a discount last November before moving up to three in 10 homes this year. In Sonoma County, reductions in the same price range increased from 24 percent last year to 52 percent now.

The heat map in Figure 4 illustrates the change in price reductions over the last three months compared with last year. Red denotes an increase of 20 percentage points or more in price reductions. For example, Milpitas saw the largest inventory gain and also the largest increase in reductions, up by 27 percentage points, from 4 percent last year to 31 percent this year. Other housing markets with similarly large increases in price reductions include Sonoma County areas that were impacted by Tubbs Fire last year. But again, homes in desirably priced areas in and around employment centers in San Francisco and with access to transit saw fewer price reductions than last year, notably in Alameda County and South San Francisco. At the same time, farther-flung areas, such as eastern parts of the East Bay and eastern parts of Santa Clara County, saw the most price reductions.

Figure 4: Change in price reductions from September through November compared with the same period last year

Source: Terradatum, Inc. from data provided by local MLSes, Dec. 7, 2018

In conclusion, while expectations over slowing price growth and diminished buyer frenzy have come to fruition, inventory gains have exceeded most forecasts. Existing homeowners may find that with home price growth reaching a plateau, they are in the best position to sell now. There may be other reasons that more sellers have chosen to list their homes, including the cost of living in the Bay Area. However, as the local economy remains strong and the unemployment rate keeps trending lower, new inventory is providing more choices for buyers who would like a Bay Area home to call their own.

Selma Hepp is Compass’ Chief Economist and Vice President of Business Intelligence. Her previous positions include Chief Economist at Trulia, senior economist for the California Association of Realtors, and economist and manager of public policy and homeownership at the National Association of Realtors. She holds a Master of Arts in Economics from the State University of New York (SUNY), Buffalo, and a Ph.D. in Urban and Regional Planning and Design from the University of Maryland.

(Promotional photo: iStock/kali9)

_______
Shared with permission from the Pacific Union Blog

Compass’ November 2018 Real Estate Update

Five Bay Area regions posted median sales price declines in November from one year earlier, while Silicon Valley was the only one to see a double-digit-percent annual gain. Marin, Sonoma, and Contra Costa counties, along with the Mid-Peninsula, enjoyed significant year-over-year inventory improvements.

Click on the image accompanying each of our regions below for an expanded look at local real estate activity in November.

CONTRA COSTA COUNTY

The number of homes for sale in Contra Costa County grew by nearly 17 percent from November 2017. Perhaps because of the supply gain, the median sales price relaxed by 4.6 percent year over year, ending the month at $1,192,500.

Click the image to the right to see these and other Contra Costa County market statistics for November.

Defining Contra Costa County: Our real estate markets in Contra Costa County include the cities of Alamo, Blackhawk, Danville, Diablo, Lafayette, Moraga, Orinda, Pleasant Hill, San Ramon, and Walnut Creek. Sales data in the adjoining chart includes single-family homes in these communities.


EAST BAY

East Bay homes sold in an average of 22 days in November, faster than they did anywhere else in the Bay Area. Homes in the region continued to command the largest premiums, fetching 111.9 percent of original price, slightly less than at the same time last year.

Click the image to the right to see these and other East Bay market statistics for November.

Defining the East Bay: Our real estate markets in the East Bay region include Oakland ZIP codes 94602, 94609, 94610, 94611, 94618, 94619, and 94705; Alameda; Albany; Berkeley; El Cerrito; Kensington; and Piedmont. Sales data in the adjoining chart includes single-family homes in these communities.


MARIN COUNTY

The median sales price in Marin County was $1,150,444 in November, an annual decline of 8.6 percent. There were nearly 500 single-family homes on the market, up by 19.6 percent on a yearly basis.

Click the image to the right to see these and other Marin County market statistics for November.

Defining Marin County: Our real estate markets in Marin County include the cities of Belvedere, Corte Madera, Fairfax, Greenbrae, Kentfield, Larkspur, Mill Valley, Novato, Ross, San Anselmo, San Rafael, Sausalito, and Tiburon. Sales data in the adjoining chart includes single-family homes in these communities.


NAPA COUNTY

Napa County‘s $693,500 median sales price was down from October but up by 1.7 percent on an annual basis. Buyers received 94.6 percent of original price, nearly identical to numbers recorded at the same time last year.

Click the image to the right to see these and other Napa County market statistics for November.

Defining Napa County: Our real estate markets in Napa County include the cities of American Canyon, Angwin, Calistoga, Napa, Oakville, Rutherford, St. Helena, and Yountville. Sales data in the adjoining chart includes all single-family homes in Napa County.


SAN FRANCISCO — SINGLE-FAMILY HOMES

The inventory of single-family homes in San Francisco improved from the previous November, rising by 12.9 percent. The median sales price ended the month at $1,442,500, down by 3.5 percent year over year and the lowest since January.

Click the image to the right to see these and other San Francisco single-family home market statistics for November.


SAN FRANCISCO — CONDOMINIUMS

As with single-family homes, San Francisco condominium prices relaxed on an annual basis, falling by 4.2 percent to $1,200,000. Units sold in an average of 36 days, similar to the pace of sales recorded at the same time last year.

Click the image to the right to see these and other San Francisco condominium market statistics for November.


SILICON VALLEY

Silicon Valley remains the most expensive Bay Area region in which Compass operates, with a November median sales price of $3,441,000. Homes commanded an average of $1,478 per square foot, also the most in the Bay Area.

Click the image to the right to see these and other Silicon Valley market statistics for November.

Defining Silicon Valley: Our real estate markets in Silicon Valley include the cities and towns of Atherton, Los Altos (excluding county area), Los Altos Hills, Menlo Park (excluding east of U.S. 101), Palo Alto, Portola Valley, and Woodside. Sales data in the adjoining chart includes all single-family homes in these communities.

Mid-Peninsula Subregion

The Mid-Peninsula got a strong inventory boost from November 2017, with the number of homes on the market up by 55 percent. For the first time in a year, buyers received slight discounts, with homes selling for 98.9 percent of original price.

Click the image to the right to see these and other Mid-Peninsula market statistics for November.

Defining the Mid-Peninsula: Our real estate markets in the Mid-Peninsula subregion include the cities of Burlingame (excluding Ingold Millsdale Industrial Center), Hillsborough, and San Mateo (excluding the North Shoreview/Dore Cavanaugh area). Sales data in the adjoining chart includes all single-family homes in these communities.


SONOMA COUNTY

Sonoma County‘s median sales price closed out November at $615,000, a decrease of 7.5 percent on an annual basis and the lowest in the past year. There were more than 1,500 properties on the market last month, up by 28.3 percent from November 2017.

Click the image to the right to see these and other Sonoma County market statistics for November.

Defining Sonoma County: Sales data in the adjoining chart includes all single-family homes and farms and ranches in Sonoma County.


SONOMA VALLEY

The median home sales price in Sonoma Valley was $784,500 in November, up by nearly 10 percent from the same time last year. Buyers paid $645 per square foot, an annual gain of 20.6 percent.

Click the image to the right to see these and other Sonoma Valley market statistics for November.

Defining Sonoma Valley: Our real estate markets in Sonoma Valley include the cities of Glen Ellen, Kenwood, and Sonoma. Sales data in the adjoining chart refers to all residential properties – including single-family homes, condominiums, and farms and ranches – in these communities.


LAKE TAHOE/TRUCKEE — SINGLE-FAMILY HOMES

Single-family home prices in the Lake Tahoe/Truckee region ended November at $740,000, down substantially from October but up by 4.2 percent year over year. Sellers took home 92.6 percent of original price, nearly identical to what they received at the same time last year.

Click the image to the right to see these and other Lake Tahoe/Truckee single-family home market statistics for November.

Defining Tahoe/Truckee: Our real estate markets in the Lake Tahoe/Truckee region include the communities of Alpine Meadows, Donner Lake, Donner Summit, Lahontan, Martis Valley, North Shore Lake Tahoe, Northstar, Squaw Valley, Tahoe City, Tahoe Donner, Truckee, and the West Shore of Lake Tahoe. Sales data in the adjoining chart includes single-family homes in these communities.


LAKE TAHOE/TRUCKEE — CONDOMINIUMS

As with single-family homes in the region, the median price for condominiums in the Lake Tahoe area saw modest annual growth, rising by 3.2 percent to $485,000. Inventory conditions were virtually identical to levels recorded in November 2017.

Click the image to the right to see these and other Lake Tahoe/Truckee condominium market statistics for November.

Defining Tahoe/Truckee: Our real estate markets in the Lake Tahoe/Truckee region include the communities of Alpine Meadows, Donner Lake, Donner Summit, Lahontan, Martis Valley, North Shore Lake Tahoe, Northstar, Squaw Valley, Tahoe City, Tahoe Donner, Truckee, and the West Shore of Lake Tahoe. Sales data in the adjoining chart includes condominiums in these communities.

_______
Shared with permission from the Pacific Union Blog

Home of the Week: Bel-Air masterwork with sweeping views

Poised atop a double-gated promontory, three wings of mirrored, translucent and clear glass overlook panoramic 360° vistas of the canyons, downtown skyline and ocean.

This is 11490 Orum Road, a tour de force by architect Zoltan Pali with every detail designed for opulent, exhilarating living. Sensitively married with the surrounding environment, the home’s ultramodern open plan spaces flow seamlessly from indoors to out via floor-to-ceiling walls of glass and sliding doors to stunning view decks and patios.

A blend of limestone, travertine, and quartzite, accented by rift-sawn white oak paneling and white oak floors, creates warmth and functionality together with the ultimate in luxury.

Encompassing some 18,850 square feet, the home has nine bedrooms, ten full baths and five half baths. The gourmet kitchen with butler’s pantry is equipped with Sub-Zero, Wolf, and Miele appliances.

The outside entertainment area is magical, surrounded by sweeping city views from every angle. Highlights include a summer kitchen, alfresco dining table, two firepits and an LED-lit swimming pool and spa. Indoor amenities include a custom cedar sauna, luxe home theater, gym, and 1,000-bottle wine room.

This incomparable work of art is listed by Aaron Kirman and Louis Evans at $56,000,000.

_______
Shared with permission from the Pacific Union Blog

Bay Area Cities Dominate List of California’s Best Job Markets

  • San Ramon ranks as California’s top job market in 2018, followed by Palo Alto, Danville, Los Gatos, Santa Clara, and Pleasanton.
  • Palo Alto boasts the state’s overall best employment market.
  • Workers in the Northern California cities of Hollister, Antioch, Gilroy, Oakley, and Pittsburg earn California’s largest annual starting salaries.
An aerial view of Stanford University, one of the largest employers in the Santa Clara County city of Palo Alto.
An aerial view of Stanford University, one of the largest employers in the Santa Clara County city of Palo Alto.

California’s unemployment rate remained at a record-low 4.1 percent in October, and there’s nowhere better in the state to find a new job as 2018 nears its end than in the thriving Bay Area.

The Golden State is doing well when it comes to creating jobs, adding more than 36,000 in October, according to the latest numbers from the California Employment Development Department. As the world’s fifth-largest economy, California has added more than 3 million jobs since the economic recovery kicked off in early 2010.

To find out where workers have the best chance at landing a gig, WalletHub ranked more than 250 California cities on a 100-point scale. The study gauges employment markets on 16 individual criteria across two main categories: the job market, representing about two-thirds of the final score, while a city’s socioeconomic environment accounts for the other one-third.

Contra Costa County‘s San Ramon is California’s top-rated job market, notching a total score of 70.40 and boasting the state’s second top-performing overall employment market. According to EDD data, the city’s largest employers include energy giant Chevron and staffing agency Robert Half. Contra Costa County’s unemployment rate ended October at 3.0 percent.

Palo Alto narrowly missed the top position, coming in at No. 2 with a score of 69.47. The wealthy Santa Clara city boasts California’s best overall job market, ties for the most employment opportunities, and ranks in the top five for the highest job-growth rate.

Contra Costa and Santa Clara counties are top locations for workers who want to maximize their starting salaries. While the San Benito County seat of Hollister leads the state for best salaries, it is followed by Antioch, Gilroy, Oakley, and Pittsburg.

The Bay Area took nine of the top 10 spots on the list, rounded out by Danville (No. 3), Los Gatos (No. 4), Santa Clara (No. 5), Pleasanton (No. 6), Livermore (No. 8), Los Altos (No. 9), and Morgan Hill (No. 10). Los Gatos ranks among California’s five best cities for job growth and unemployment rate for high school graduates. Meanwhile, Danville boasts one of the state’s lowest jobless rates and also one it of its highest annual median incomes.

Orange County’s Rancho Santa Margarita was Southern California’s lone representative in the top 10, placing No. 7 with a 65.79 score. The Los Angeles County city of Walnut ranks No. 18 — tying for the state’s most job openings with Palo Alto and Menlo Park — while San Diego County’s Poway comes in at No. 15.

(Photo: iStock/SpVVK)

_______
Shared with permission from the Pacific Union Blog

Real Estate Roundup: California Again Leads the Nation for Home-Equity Gains

Here’s a look at recent news of interest to homebuyers, home sellers, and the home-curious.

An aerial view of Santa Monica, California

GOLDEN STATE HOMEOWNERS GAIN THREE TIMES MORE EQUITY THAN THE U.S. AVERAGE
Although U.S. homeowners saw their home-equity gains moderate in the third quarter due to cooling price growth, California remains at the top of the heap, with owners pulling in about three times the national average.

A new CoreLogic report says that the average American homeowner gained $12,400 in equity year over year in the third quarter, down by $3,600 from the second quarter. Golden State owners enjoyed the largest annual equity increase in the U.S., making an average of nearly $37,000 from the third quarter of 2017.

Nationwide, there were 2.2 million homeowners with negative equity, accounting for 4.1 percent of properties with a mortgage. Of the 10 major housing market for which CoreLogic tracks data, San Francisco had the fewest owners with negative equity, at 0.6 percent.

The news comes not long after ATTOM Data Solutions reported that California also has the most equity-rich homeowners in the U.S., at nearly 43 percent. San Jose has the largest percentage of equity-rich owners in America (73.9 percent), followed by San Francisco at No. 2 (59.8 percent) and Los Angeles at No. 3 (47.6 percent).


CALIFORNIA DECREES THAT ALL NEW HOMES WILL HAVE SOLAR POWER
California took a historic housing step last week, as the state Building Standards Commission mandated that newly built homes in the state must come to market with solar panels.

As The Mercury News reports, the state will require all new single-family homes and apartment complexes up to three stories high built after 2020 to have solar power. While the move will add about $10,000 to the cost of construction a home, owners will save about $500 per year on energy bills, offsetting the extra costs over the 30-year lifespan of the solar panels.

Opponents of the mandate include officials in areas that were recently ravaged by the devastating Camp Fire. Butte County Treasurer Peggy Moak says that requiring homes to have solar power will burden homeowners who need to rebuild after the disaster, while Yuba City Assemblyman James Gallagher worries that it will further exacerbate California’s well-documented housing-affordability issue.


U.S. HOME-FLIPPING ACTIVITY, SELLER RETURNS DROP IN THE THIRD QUARTER
Home flippers were the least active as they have been in more than three years in the third quarter, reflecting cooling conditions in the U.S. housing market.

That’s according to a recent analysis from ATTOM Data Solutions, which says that investors flipped nearly 46,000 homes in the third quarter, a year-over-year decrease of 12 percent and the fewest since the first quarter of 2015. In a statement accompany the report, company Senior Vice President Daren Blomquist noted that although home flipping has declined for three straight quarters, activity dropped for 11 consecutive quarters leading up to the housing-market crash a decade ago.

Flippers also saw their profits decline to an average of $63,000 percent more than purchase price, the lowest returns in more than two years. Gross flipping profits represented a nearly 43 percent return on investment and have not been that low since the beginning of 2012.


MOST AMERICANS AGREE THAT A HOUSING AFFORDABILITY CRISIS EXISTS
Housing affordability is certainly a challenge for prospective buyers in California, but new survey results underscore that it is a nationwide problem of which most Americans are keenly aware.

A poll conducted by the National Association of Home Builders found that 73 percent of U.S. residents believe that the ability to afford a home is a nationwide issue. Nearly 70 percent cited affordability as a problem in their state, while more than half noted concerns about conditions in their neighborhood.

The results dovetail with earlier NAHB findings, in which eight in 10 Americans said that they could only afford to buy less than half of the homes for sale near their current residence. Almost one-third of U.S. households shell out more than 30 percent of their incomes to put a roof over their heads, defining them as cost-burdened.

(Photo: iStock/chrisp0)

_______
Shared with permission from the Pacific Union Blog

Home of the Week: Russian Hill Estate May Set New San Francisco Price Record

A unique compound on two hillside lots at 950 Lombard St. in San Francisco’s Russian Hill could break the record set earlier this year for a lavish urban penthouse that sold for $38 million. Spearheaded by Babac Doane of Ken Linsteadt Architects and developer Greg Malin (Troon Pacific), the project combines two structures — a circa 1907 shingled house by noted Bay Area architect Willis Polk  and a contemporary concrete podium-level construction.

Totaling some 9,500 square feet, the cutting-edge open plan residence commands a breathtaking panoramic view of the city and the bay. It includes a two-story subterranean art gallery, a glass elevator to all levels, a cantilevered infinity pool, and a shower and sauna with glass walls overlooking the city.

Health is a key factor throughout the home, with amenities that include an 850-square-foot wellness center with a spa and steam room and a Japanese water-filtration system said to improve skin and hair.

A dedicated system replaces all the air in the home every other hour, while shield cables help mitigate electromagnetic frequencies and exhaust vents minimize industrial air.

The compound’s gated entrance opens to a garden with olive trees, an outdoor kitchen, a dining table, and a fireplace. A dramatic tunnel-like drive leads to the four-car garage.

The estate is listed by Val Steele at $45 million.

_______
Shared with permission from the Pacific Union Blog

Bay Area City Ranks as America’s Best for “Wallet Fitness”

  • Alameda County’s Fremont has been named America’s most financially fit city in 2018.
  • San Francisco and San Jose also count among the nation’s top five wallet-smart cities.
  • Maintaining an excellent credit score, avoiding unnecessary expenses, and saving money are a few common-sense approaches to keeping one’s finances in good health.

U.S. dollar money banknote in full wallet

Buying a home in the Bay Area is an expensive proposition these days, so it makes sense that residents of three local cities are among the top five in the country for financial savvy.

That’s according to an analysis by WalletHub, which ranks more than 180 U.S. cities for what it calls “wallet fitness.” The company claims that wallet fitness — which measures a household’s ability to maintain a top-notch credit score, minimize debt and spending, and exercise diligence when saving for retirement or emergencies — is one of the biggest stressors in the nation.

By those criteria, residents of Fremont as the most financially savvy in America, scoring a 66.42 on a 100-point scale. The Alameda County city ranks No. 1 in the country for both credit standing and risk exposure, the latter of which encompasses factors such a liability, the number of underwater homes, the unemployment rate, and job security. Fremont boasts the nation’s highest median credit score and lowest amount of nonmortgage debt and ranks among the top five for the fewest foreclosures.

It’s not the first time this year that WalletHub has lauded the East Bay city. In March, the company named Fremont as America’s happiest city for the second straight year before declaring it the country’s third-best place to raise a family six months later.

San Francisco finishes in the No. 3 spot for wallet fitness, notching a 65.47. San Franciscans have the country’s second-lowest level of risk exposure and rank in the top five for the smallest nonmortgage debt and best credit scores

San Jose followed at No. 4, with a score of 64.65. Residents of California’s third-largest city are the third best in America at stashing cash and like its neighbors count among those with the least amount of debt unrelated to a mortgage.

WalletHub offers a handful of common-sense tips for getting your monetary house in better shape: Pay bills on time, avoid unnecessary indulgences, shop ound for financial products, get a better job, and save diligently.

(Photo: iStock/Supaphorn)

_______
Shared with permission from the Pacific Union Blog

Wine Country Housing Markets: One Year After the Wildfires

Executive Summary:

  • After the initial rush for homes following the Tubbs Fire in October 2018, North Bay home sales activity slowed more than in the rest of the Bay Area, particularly in Sonoma County.
  • Sales of residential lots in Sonoma County have jumped by 265 percent year to date from 138 parcels sold in 2017 to 504 this year.
  • More than 75 percent — or 389 — of the lots sold were lost to wildfires, 99 percent of which were in Santa Rosa’s 95403 and 95404 ZIP codes
  • Sonoma County’s inventory levels rose faster than in the rest of Bay Area following the fires.
  • While annual median home price growth in Sonoma County was up by more than 15 percent following the fires, it started slowing shortly after — much sooner than the rest of the Bay Area.
  • However, median home prices in the 95403 and 95404 ZIP codes remained relativity steady, averaging 8 percent year-over-year growth from January through October.
  • According to Compass Bay Area transaction data, 15 percent of all buyers after the disaster purchased a home because they lost their previous one in the wildfires, with the median purchase price at $625,000.
  • To find a home, buyers increasingly relied on their friends and family, with about one in 10 finding a property through personal connections, up from only 1 percent prior to the fires.
  • Eleven percent of sellers over the last year sold because they lost their homes in the fires.
  • Wine Country sellers do seem to be aggressively moving out of state; before the fires, only 2 percent of sellers liquidated because they were leaving California. Post-disaster, out-migrants ticked up to 11 percent of all sellers.

Wildfires are a harsh reality of living in California, especially during the month of October. Thousands of fires burn throughout the state at all times every year, but October seems to be the worst month. Six of California’s seven most destructive wildfires happened in October, including the Tubbs Fire in Sonoma and Napa counties, which was previously ranked as the most devastating California wildfire, claiming more than 5,600 structures and 22 lives.

Unfortunately, the more recent Camp Fire in Butte County was significantly more catastrophic, taking more than 18,000 structures and 88 lives and now ranking as the state’s worst wildfire. In addition, the Woolsey Fire in Los Angeles and Ventura counties, which started on the same day as the Camp Fire (Nov. 8) destroyed more than 1,500 structures and claimed three lives.

The following analysis examines North Bay housing markets a year after the Tubbs Fire, which ignited on Oct. 8, 2017, compared with market activity before the tragedy.

Comparing total home sales in the first 10 months of 2018 with the same period in 2017 suggests that overall activity has declined in Sonoma, Napa, and Marin counties — but not notably more than in the rest of the Bay Area. Figure 1 summarizes year-to-date (January through September) sales in North Bay counties and the overall Bay Area. (October sales are omitted because the fires started early that month in 2017.) All areas saw fewer sales than in 2017, with the rest of the Bay Area tracking 4 percent below last year. Sales in Marin County were down by 3 percent, with Napa and Sonoma counties recording respective declines of 5 percent and 7 percent.

Nevertheless, while overall sales trended lower due to fewer transactions below $1 million, North Bay counties saw stronger activity for higher-priced homes — similar to the rest of the Bay Area — with Sonoma and Napa counties both posting increases of more than 20 percent in sales of homes priced above $1 million. In Sonoma County, sales above $1 million have contributed 17 percent to overall 2018 activity, up from 13 percent in 2017. In Napa County, higher-priced sales accounted for 25 percent of overall 2018 sales compared with 20 percent in 2017.

Higher-priced home sales in Marin County now contribute 61 percent of activity, up from 54 percent last year, and have seen a relatively smaller increase, though 2017 was a very strong year for higher-priced sales there.

Figure 1: Year-to-date change in home sales by price range in the North Bay and the rest of the Bay Area

Source: Terradatum, Inc. from data provided local MLSes, Nov. 7, 2018

Nevertheless, while total year-to-date sales activity in the North Bay lines up closely with the rest of the Bay Area, the region followed a slightly different trend immediately following the fires. Figure 2 illustrates year-over-year changes in sales from October 2017 to September 2018. In the North Bay, October 2017 sales posted an 11 percent decline, as the fires raged through the area that month, before jumping to a 15 percent increase immediately after the disaster and remaining elevated until February. Starting in March, North Bay sales activity returned to follow overall Bay Area trends but still tracked lower than the overall region.

Between March and September, North Bay monthly home sales declines averaged about 6 percentage points lower than the Bay Area. For example, in June, while North Bay sales dropped by 15 percent on an annual basis, Bay Area sales declined by 9 percent. In August, the North Bay again outperformed the Bay Area, with a 2 percent decline versus a 9 percent decrease in the entire region. In September, the whole Bay Area posted a 20 percent drop in sales activity.

Figure 2: Year-over-year change in home sales in the North Bay (Marin, Napa, and Sonoma counties) and the entire Bay Area

Source: Terradatum, Inc. from data provided local MLSes, Nov. 7, 2018

Figure 3 breaks out home sales numbers for the three North Bay counties. While Napa County shows more volatility in monthly changes, activity is consistent with long-term trends, possibly due to relatively fewer monthly sales. Napa County averages slightly more than 100 sales a month.

By contrast, it is interesting to note a 29 percent jump in November sales in Marin County, as families who lost their homes in fire-affected areas started shopping. After January, Marin County sales returned to follow Bay Area trends. The decrease in Sonoma County sales after the initial jump in early 2018 continued throughout summer, even while Napa and Marin counties saw improvement. In September, however, Sonoma County posed the largest year-over-year decline of all Bay Area counties, at 26 percent.

Figure 3: Year-over-year change in home sales by North Bay county.

Source: Terradatum, Inc. from data provided local MLSes, Nov. 7, 2018

Nevertheless, while sales of single-family homes have declined overall in Sonoma County, there has been a substantial increase in sales of residential lots, which skyrocketed by 265 percent in the first three quarters compared with the same period last year, from 138 parcels to 504. Seventy-seven percent, or 389, of the lots sold were parcels where homes were destroyed by the fires. Figure 4 summarizes the sales activity of fire-affected lots over the last year and illustrates the number of such parcels for sale in Sonoma County.

Similar to sales of existing homes, fire-lot sales peaked in March and have since leveled off. Importantly, almost all of the 389 fire lots sold were in two ZIP codes: 95403 and 95404, two adjacent urbanized areas in Santa Rosa. The impact of the wildfires in those two areas is discussed below. The number of lots available for sale has remained consistently elevated since the fires.

Figure 4: Number of lots for sale and sold in Sonoma County between December 2017 and October 2018

Source: Terradatum, Inc. from data provided local MLSes, Nov. 7, 2018 

Let’s turn to the impact on inventory of existing homes. Supply shortages of single-family homes and condominiums, which characterized most of 2017, persisted through the first half of 2018 before improving. Figure 5 illustrates inventory trends in the North Bay compared with the rest of the Bay Area, and the line demarcates October 2017, the onset of the wildfires. Immediately following the fires, inventory continued its downward trend, though the Bay Area lost supply at a faster pace than North Bay counties. Starting in the late spring, increases in supply finally began to match last year’s levels.

Most interestingly, Sonoma County’s inventory improved before the rest of the region in the early spring, climbing to an 18 percent year-over-year increase in September. Inventory in the rest of the Bay Area caught up with Sonoma County after the summer and posted a 14 percent annual gain in September. Napa and Marin counties (along with San Francisco, not shown here) showed the smallest annual increase in inventory in the Bay Area in September, with Marin up by 6 percent, and Napa County logging a 2 percent gain. In October, however, all regions posted even higher increases in inventory, and the Bay Area’s 23 percent gain outpaced Sonoma County’s 21 percent improvement.

Figure 5: Year-over-year change in homes for sale by North Bay county and the rest of the Bay Area

Source: Terradatum, Inc. from data provided local MLSes, Nov. 7, 2018 

The recent increase in inventory in Sonoma County is mostly driven by the availability of homes priced below $1 million, while higher-priced homes still trend below last year’s levels. Sonoma County is not the only area where more affordable homes are making a comeback; it is a trend seen across the region, with the most significant increases in Santa Clara and Napa counties, along with the East Bay. Only San Mateo, Marin, and San Francisco counties continue to see no or very small improvements in affordable inventory. But while Sonoma and Napa counties are not experiencing increases in higher-priced inventory, other local regions are.

Considering supply changes across regions, it is hard to determine a notable difference between the Wine Country and other Bay Area counties. However, the overall increase in inventory suggests that sellers may believe that home price appreciation has peaked and that it may be a good time to list their properties. In addition, the uptick in lower-priced inventory indicates that affordability burdens coupled with traffic congestion and the Bay Area’s overall cost of living may be taking a toll on budget-constrained households — especially in Sonoma County, where access to employment centers is limited due to fewer transportation corridors.

Moreover, in addition to more residential units available for sale, the number of lots on the market has increased notably. As shown in Figure 4, there has been a significant gain in number of available parcels each month since December, and while the absorption rate declined from the initial rush, it is still consistent with longer-term trends seen in Sonoma County. Again, keep in mind that almost all of the fire-lot activity is centered in the 95404 and 95403 ZIP codes.

In terms of median home prices in the Wine Country and the Bay Area following the wildfires, Figure 6 illustrates year-over-year changes since August 2017. Unlike in the overall Bay Area, the North Bay began seeing slower price growth in September 2017 prior to the fires. Following the events, Sonoma and Napa counties saw a large jump in price growth — about 15 percent to 18 percent in the first few months of 2018 — but appreciation then started falling much before it did in the overall Bay Area. In October, Sonoma County registered only a 2 percent price increase from last October, while Napa and Marin counties (and the rest of the Bay Area) maintained 10 percent median price growth.

Figure 6: Year-over-year change in median home prices in the North Bay and the Bay Area

Source: Terradatum, Inc. from data provided local MLSes, Nov. 7, 2018

Figure 7 tracks median home prices in Sonoma County and the two ZIP codes most affected by the wildfires. While Sonoma County’s overall median sales price growth averaged 11 percent in the last year, appreciation averaged 8 percent in the 95403 and 95404 neighborhoods. In November, however, Sonoma County’s median price posted a 4 percent year-over-year decline, with the two aforementioned ZIP codes seeing no change from last year. In other words, urbanized ZIP codes that were most impacted by the fires did not lose appeal with homebuyers. In addition, the price of lots increased from over $162,000 in December 2017 to hover around $260,000 in the last few months, with no significant declines recently. Figure 8 illustrates changes in the median price of lots sold.

Figure 7: Median home price changes in Sonoma County and two Santa Rosa ZIP codes

Source: Terradatum, Inc. from data provided local MLSes, Nov. 7, 2018

Figure 8: Median sales price for lots sold in Sonoma County

Source: Terradatum, Inc. from data provided local MLSes, Nov. 7, 2018

However, rapid price growth following the fires, along with higher interest rates, took a large bite out of affordability, which is the main reason for slowing sales and prices in Sonoma County and the Bay Area in general. Taking together year-to-date price growth of 9 percent in Sonoma County and about a 100-basis-point increase in mortgage rates, the added cost to local homebuyers is more than 13 percent.

The weight of the affordability crisis in Sonoma County is further evident by the large increase in price reductions for homes priced below $1 million. Sales with a reduction jumped from 26 percent last September and October to 45 percent one year later. The only other areas with similar increases in price drops for homes priced below $1 million are the South Peninsula and Santa Clara County, though the price difference when compared with Sonoma County is notably larger, even for affordable homes. For example, while the overall median sales price in Sonoma County hovers around $600,000, the median price of homes below $1 million is still 40 percent higher — $845,000 — in the South Bay. In addition, other indicators such as time on market and absorption rates suggest that buyers of affordable homes have taken a large step back in Sonoma County, though much less so in Marin and Napa counties.

Lastly, an analysis of Compass’ California Bay Area buyer and seller data reveals compelling insights. First, 15 percent of all buyers after the wildfires purchased a home because they lost property in the disaster, with a median price of $625,000. Also, 50 percent of buyers who bought because they lost their homes noted location as essential — suggesting that they were sticking around because of jobs, family, and schools.

Furthermore, investor activity increased following the fires. Prior to the October 2017 events, only 1 percent of buyers bought to develop and flip a property; that share jumped to 8 percent afterward.

To find a home, buyers increasingly relied on friends and family, with almost one in 10 locating a property via personal connections, up from 1 percent prior to the fires. Additionally, 11 percent of sellers over the last year liquidated property because they lost their home in the fires. More Wine Country sellers seem to be moving out of state; before the fires, only 2 percent of local homeowners sold because they were moving out of California. After the fires, move-outs jumped to 11 percent of all sellers.

In summary, as major previous California wildfires have shown — such as the Oakland Hills Fire in 1991 and the Cedar Fire in San Diego in 2003 — communities generally return to their pre-disaster conditions within a year or two following the incidents and market activity lines up with longer-term trends in those respective counties. However, the impact of Camp Fire may be felt much longer in Butte County and surrounding areas as a larger share of housing stock was lost. Also, the lack of new construction due to labor, cleared land, and lumber shortages that has crippled the industry over the last few years shows no signs of improvement.

Nevertheless, while the reality of wildfires in California remains, the bigger question facing both homeowners and renters is the overall quality of life. With expensive housing and increased commute times, budget-constrained households may choose to relocate, and these trends are not only seen in Sonoma County but also in California’s most expensive housing markets in the heart of Silicon Valley.

Selma Hepp is Compass’ Chief Economist and Vice President of Business Intelligence. Her previous positions include Chief Economist at Trulia, senior economist for the California Association of Realtors, and economist and manager of public policy and homeownership at the National Association of Realtors. She holds a Master of Arts in Economics from the State University of New York (SUNY), Buffalo, and a Ph.D. in Urban and Regional Planning and Design from the University of Maryland.

(Promotional photo: iStock/latypova)

_______
Shared with permission from the Pacific Union Blog

Home of the Week: Sweeping new masterpiece in Mandeville Canyon

Expansive, light-washed spaces and softly glowing woods combine to beautiful effect in this new gated estate at 2333 Mandeville Canyon Road. Covering some 10,600 square feet, it offers an environment for living and entertaining on the grandest scale. Every element of the residence reflects the utmost in artistry and quality, from wide-plank French oak flooring to dramatic lighting.

The entry opens to a vast center hall with soaring views of the upper level. In the elegant living room, custom sliding barn doors open to the adjoining library with built-in cabinetry and ladder. A jewel-like powder room delights with backlit onyx counter and golden lighting fixtures.

The enormous dining room is served by a long double butler’s pantry. An immense state-of-the art chef’s kitchen with breakfast room flows to a spacious family room, where disappearing sliders open to the barbecue area, pool/spa and grassy back yard. Two guest/maid suites flank the home on this level.

Upstairs, the lavish master suite is highlighted by a vaulted and beamed ceiling, relaxing fireplace and ultra-luxe bath. Three more bedroom suites and a loft family room complete this floor. The basement level is home to an upscale range of amenities, from custom bar, game area, theatre and wine room/cellar to gym and steam room. Smart Home technology includes Crestron+Lutron systems. There is a three-car garage plus parking for additional cars.

The incomparable estate is listed by Susan Stark at $13,499,000.

_______
Shared with permission from the Pacific Union Blog