What are your Real Bay Area house price predictions for 2010?
Ok readers, it’s that time of the year – what are your predictions for some of the star cities of the Real Bay Area?
For reference, here are the current stats for some selected ones:
Palo Alto 2009 Market Trends 
Mountain View Market Trends 
Sunnyvale Market Trends 
Cupertino Market Trends 
Atherton Market Trends 
Ok, now these are just a few of Burbed’s favorite cities, but you can feel free to pick your own cities to make predictions foru.
Burbed is going to predict that… this time in 2010, both the list and sold price will be 10% higher than they are in these pictures.
2010 is going to be big. As we all know, real estate is on a 5 year cycle. The downturn started 5 years ago and so of course now is the time for it to soar. (BTW, this is actually a real quote I sort of heard. Really? The downturn started in 2004/2005? Hm.)
Also, it’s clear that the economy is roaring back to life. Look at the stock market. Cha-ching! Everyone has money to buy tons of houses. And where do you buy tons of houses? In the Bay Area – of course. It’s the best investment known to man… in history… ever!
Hurray 2010!
December 31st, 2009 at 8:08 am
Based on my observations, RBA peaked in mid-07.
My guess for next year is flat to down 10% per sq ft. Why?
- The economy seems to be stabilizing.
- Local tech companies are doing ok. Not booming, but not crashing either.
- With revenue-limit districts getting squeezed financially and doing things like 30 kids per class, there will be more demand to get into basic aid districts which are mostly locally funded and therefore not as dependent on Sacramento. And also have foundations to pick up the slack. (Los Gatos, Los Altos, Palo Alto, Saratoga, I think Fremont HSD, and others.) These tend to be RBA. And even with values going down, the average assessment still goes up 2% per year because the assessed value is so much less than the actual property value. (the hidden benefit of prop 13!)
But I still don’t predict appreciation as the economy is not booming.
5 years out, inflation will pick up. This will enable both housing bears and bulls to proclaim that they are correct:
Bulls: Prices are up!
Bears: Govt says inflation is 4% per year. It’s really 10% – I bought milk and it was more than I remember from last year. Therefore the 5% annual appreciation is really a loss.
December 31st, 2009 at 9:06 am
A good bet is that the employment picture will improve, contributing to fewer foreclosures nationwide, and stabilizing the housing market overall.
Checking out the latest good news:
The number of Americans filing first-time claims for unemployment insurance fell sharply last week to the lowest level in 17 months, the government said Thursday. Analysts had expected an increase.
December 31st, 2009 at 9:42 am
If anything I wouldn’t expect anything remarkable for the Bay Area or California for the next 5-10 years.
The economy is not what I’d call healthy. Just better than 6 months ago. Not many companies have posted real meaningful profits. The banks are still hiding untold trillions of dollars in toxic assets under the revised mark to market rules. Unemployment is still high.
I am willing to admit that there’s a certain price point that seems to be sticky in semi-desirable to very desirable areas. In the East Bay, around $450k-$500k seems to be about as low as the prices go. Anything in that price seems to sell fairly well. Anything higher sits for awhile. But people are buying. But the prices aren’t moving up either.
There will probably be a protracted period of stagnation in home prices. Perhaps a good 5-10 years with either flat or very modest gains of 2%-4%. There’s no catalyst for growth. The Bay Area is entirely dependent on bubbles to survive and grow as it typically has. Many of the latest trendy social network sites garner huge usage but have yet to make a penny. Green tech and biotech have not turned out to be the “next big thing” either. Wages have actually gone down in most sectors. Put this together and there isn’t anything remarkable to create the bubble frenzy which jump-starts housing bubbles. Home builders have for the most part pulled out of California. There’s a good reason for this. They also fail to see future returns anytime soon.
December 31st, 2009 at 12:05 pm
“A good bet is that the employment picture will improve, contributing to fewer foreclosures nationwide, and stabilizing the housing market overall.
Checking out the latest good news:”
You think this because you are stupid, real estater. In fact, there is a delay between people losing their jobs and unemployment. Also, the market for high end homes will continue to languish as nobody has any ‘move-up’ equity.
December 31st, 2009 at 12:15 pm
More on your latest good news, real estater:
http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2009/12/09/MND11B17B2.DTL&source=patrick.net
Check out the first line: “Home values in the Bay Area and nation continue to sink, but they’re no longer plummeting, according to a real estate report being released today.”
Haha – good news! Home values are dropping – not plummeting! The recession is over!
Moron.
December 31st, 2009 at 12:45 pm
the flight to quality will continue with good houses with good schools slightly up in spring. flawed properties will slide another 10% or so; more outside of the RBA.
btw, this will have a noticeable impact on this high end: http://www.google.com/hostednews/ap/article/ALeqM5iy9LO1YRnkZIT2m3Dy5Xyfzq8z8gD9CLRB3O0
December 31st, 2009 at 8:54 pm
Just some casual observations during this holiday period. When I skied at Tahoe, the hotels were sold out. When I went to a Warriors game, Oracle Arena was packed. When I went to a Lakers game, the Staples Center was sold out. When I went to Disneyland, the place was beyond packed. Airports, hotels all appear to be at full capacity. If everybody went through foreclosures and job losses, what did all these partying people come from?
December 31st, 2009 at 10:14 pm
When I went to Target a few days before Christmas it was packed. Gee, the recession is over! Shoppers at high-end Target!
Hmm, I was looking at a trip to Napa this weekend. Guess what? I had my choice of luxury hotels at deep discounts. No 2-night minimum like they used to always have either… guess all of the cool kids went to Tahoe.
January 1st, 2010 at 7:07 am
When I got in my car the other day it was packed!!!!! Someone sitting in each seat!!!
If everybody went through foreclosures and job losses, what(sp) did all these people come from?
January 1st, 2010 at 10:18 am
A week back I went to see Avatar 3D and the theater was packed.
If everybody went through foreclosures and job losses, what did all these partying people come from?
January 1st, 2010 at 10:35 am
guess all of the cool kids went to Tahoe.
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Just returned from week vacation from Tahoe. Yes, ski resorts were crowded and all the rental homes were sold out – but that’s after heavy discounts. You wouldn’t dream about this kind of deals even in last winter – whether it is lakefront cabin or ski pass. The guy who works in a snowmobile place was telling business is still pretty bad. Only good news is that they got snow early this winter. Otherwise it would have been disaster.
January 1st, 2010 at 1:17 pm
“If everybody went through foreclosures and job losses, what did all these partying people come from?”
They’re renters – giddy that they were smart enough to avoid buying a home.
January 1st, 2010 at 1:38 pm
Not sure where Pralay stayed at in Tahoe. YMCA?
January 1st, 2010 at 1:55 pm
Odd – I stayed in my cabin but still noticed that there were fewer people on the road, in the stores, and in restaurants.
I’ve also been going up every winter for more than 20 years.
Where did you stay, real estate wannabe?
January 1st, 2010 at 3:10 pm
I looked at a patient’s abdominal radiograph today. His colon was packed full of sh*t. If there was a recession, how could he afford to eat and pack up like that?!
January 1st, 2010 at 3:23 pm
Let’s ask the question this way. Did anyone here stay back and not take a vacation due to the recession?
January 1st, 2010 at 5:34 pm
Not sure where Pralay stayed at in Tahoe. YMCA?
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I guess the YMCA would full be ALL the time – recession or no recession. And I am also guessing that there is no discount YMCA either. So when RealEstater says that Tahoe is not impacted by recession, probably he was talking about YMCA.
And about me, I thought I already mentioned in #11 about where we stayed. And guess what, we booked the cabin in middle of December. In normal winter ski season you wouldn’t get anything in reasonable rate after Thanksgiving weekend.
January 1st, 2010 at 5:38 pm
Did anyone here stay back and not take a vacation due to the recession?
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I got it, RealEstater……eventually. One cannot measure the impact of recession by counting visitors in Disneyland.
January 1st, 2010 at 5:44 pm
Correction in #18:
IYou got it, RealEstater….January 1st, 2010 at 8:27 pm
Restaurants and roads in the Napa Valley are deserted.
January 1st, 2010 at 10:17 pm
“Did anyone here stay back and not take a vacation due to the recession?”
Absolutely.
January 3rd, 2010 at 8:58 am
About 18 to 22 percent of all people employed in Cal. are government employees( includes state,federal, local, and teachers).
Their income has not been changed to any degree
(in fact, most union workers got a raise in 09)
Those people will continue to spend freely.
January 3rd, 2010 at 1:35 pm
We went to Reno last week. We got what had last year been a $450 room for $85. What was also crazily obvious was that just a year ago, you really had to look for penny and nickel slots. They used to be crammed into the corners and if there were any at all, there might have been 10 total. This time around I’d say about 75% of the machines were penny slots. Not that I’m a gambling man, but the difference from just a year ago was astonishing.
So yes- if you lower prices on stuff low enough, people will indeed buy. That goes for houses, groceries, gas, and everything else in between.
January 3rd, 2010 at 2:55 pm
Bob – people will buy groceries no matter what.
And you’re not getting a $450 dollar room for $80. Hotel revenues are down something like 20%. That means your $80 room was more like $100.
…and 75% of the machines were penny slots? Which god awful casino were you in??
January 3rd, 2010 at 5:06 pm
a $450 room in reno? no way, not in 2007 with the stock market doing OK and certainly not last year after the crash.
January 3rd, 2010 at 5:59 pm
steve, how can you doubt bob’s story – he is a paragon of constance and integrity!
January 3rd, 2010 at 6:25 pm
About 18 to 22 percent of all people employed in Cal. are government employees( includes state,federal, local, and teachers).
Their income has not been changed to any degree
(in fact, most union workers got a raise in 09)
Those people will continue to spend freely.
Then why do they show state gov’t employees on TV bitching about the Friday furloughs? Last I heard it was 3 Fridays per month.
January 3rd, 2010 at 7:29 pm
Because they want to be paid to do nothing 5 days a week!
Without the income from those 3 days it’s much more difficult for them to buy stuff that they don’t need (but are entitled to acquire by virtue of having been born).
January 3rd, 2010 at 7:31 pm
“steve, how can you doubt bob’s story – he is a paragon of constance and integrity!”
I’m picturing it now.
“Honey come look at this!! No car parts in the living room and the bed sheets are clean! I can’t believe we got this for $80 bucks a night! This had to have gone for (like) a gazillion dollars before the bust! It even has an LCD screen!”
No doubt bob – like real estater – is both enamored and impressed with shiny things.
January 4th, 2010 at 6:21 am
Reno never had any $450 rooms. For $450 you can fly to Vegas and stay at one of the nice hotels.
Has anyone checked the home inventory chart lately? This In December inventory must be at one of the lowest point in recent memory. I can’t wait until Spring to come to begin house shopping.
January 4th, 2010 at 8:58 am
sv shopper, apart from the new city center, $450 rooms are hard to find in vegas too. bob’s general point that hotels are hurting is correct. not even the combo of CES and AVN can sell out the wynn, bellagio, venetian, etc this week and rates are at seasonally-adjusted lows. but bob, like his doppleganger RE, resorts to exaggeration to color his post.
January 4th, 2010 at 11:53 am
All the penny slots in Reno wouldn’t make up 75% of anything.
I think more information could be derived from the cost of a lap dance, in the afternoon. $10 were in a recession, $5 we’re in a depression.
January 4th, 2010 at 1:07 pm
Has anyone checked the home inventory chart lately? This In December inventory must be at one of the lowest point in recent memory.
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LOL! The SV Shopper is back with his invented inventory theory again! Previous instances are this, this and this – every time without any factual information! If SV Shopper said so, it must be true! However, it seems SV Shopper is not talking about RBA – and definitely not one of these cities in RBA. The red lines are inventory data. They certainly do not look “lowest point in recent memory”.
January 4th, 2010 at 1:12 pm
I can’t wait until Spring to come to begin house shopping.
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What’s the point of house shopping? You are going to lose bids again – like this incident, this incident and this incident. Or did you just change your “professional realtor with Coldwell Banker“?
January 4th, 2010 at 3:03 pm
“I can’t wait until Spring to come to begin house shopping.”
Lol – begin shopping?
Looks like SV shopper isn’t an accurate tag for you. Perhaps you should change it back to real estater. Your stupidity comes through in your posts making it transparent anyway.
January 4th, 2010 at 4:05 pm
anon,
Where is your sense of humour? He can’t wait to begin shopping with his “
unprofessional realtor”.January 4th, 2010 at 6:13 pm
Anon,
First of all, stop being so nasty. It really doesn’t help your argument ( if you actually had one to make).
Yes… these rooms were seriously $450 last year. How do I know? Because we checked last year and went with a different room. The former $450 (now $85 room) was one of the nicer suites with a huge hot tub, walk-in sauna, large flat screen TV… the whole nine yards. If you don’t believe me, then that’s your call. I could really care less. Make what you want of it.
Yes- the gambling business is hurting badly. More observations I made was that last year, you almost had to run down the cocktail waitresses if you wanted a drink ( not that I actually buy their watered down swill) But this time they were practically begging us to get something. I also noticed that there were far fewer card tables in general. 2 or 3 of the older casinos were shut down entirely. That and the buffets ran all day long versus last time where they were only open at certain hours while being closed between meals.