Bay Area condo values

Bay Area
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A real real estate post!

I’ve noticed over the last year or so that while SFH values have increase 20–30% since Covid hit condominium values in the real Bay Area have actually declined. I’m currently seeing units on the Peninsula priced ~20% below their 2018 highs sitting on the market for >30 days. $/sqft appears to be in the $600–800 range vs $1200–1600 for SFH.

So the question is, are we seeing a buying opportunity for condos/townhouses? I can rationalize the disconnect as buyers putting a premium on SFHs during Covid due to the need for additional space to support WFH, distance learning, home gyms etc etc. As life returns to normal and people become busier it seems like the convenience/amenities of condos/townhomes should become more attractive and the price difference w/ SFHs return to normal. It would be interesting to track the ratio of condo $/sqft to SFH $/sqft in different zip codes to see where we are currently relative to the historical mean.

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Timing is everything. Eventually prices of condos will bottom. The question is, is it the right time to buy condos? Prices of condos include the facilities, if nobody is using them, excluding the cost of facilities, is price still reasonable? Anyhoo, I won’t buy any condos/ THs that share air ducts.

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TH would be interesting investment if rent supports it, which City / Zip code, are you referring to?

For me, I don’t want to invest in Condo if it’s outside of SF, but Peninsula and South Bay, there is value in TH.

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I am buying condos. Condos are the last to go up in value and the first to go down. Since they are still struggling is bullish for housing prices. This means there are legs in he bullish housing market.

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Seattle is the same way. I debated selling and buying 2-3 condos in Cap Hill near where CHAZ was. The condos in that area are still toxic and not selling very well. From a pure $ perspective, it’d probably be the right decision. I also have a lot of mistrust for Seattle city council which makes it riskier than it should be.

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What do you think about bellevue or redmond? Andy Jassy recently indicated amazon will concentrate expansion in those areas.

https://www.bloomberg.com/news/articles/2021-10-05/amazon-ceo-citing-rougher-patch-with-seattle-looks-to-burbs

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In general I stay between Mountain View and Burlingame. We know just about every neighborhood in that range pretty well. Too much work to look further out.

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I actually prefer Kirkland which is right between both. I think Bellevue would have the most condos though. That side of the lake is mostly SFHs.

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This is my observation from what I know of tech company locations around the Seattle area.

Kirkland: Google
Bellevue: Amazon, FB (new REI campus), Microsoft
Redmond: Microsoft, FB (oculus), Spacex, Nvidia
Seattle: Amazon, FB, Stripe, Google, Expedia, Apple

I think FB, Stripe and Google will start consolidating locations to Bellevue+Kirkland+Redmond due to Seattle city tax. Bullish on all 3 cities imo.

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Mountain View in particular looks really weak. I’ve tracked inventory there since 2010 and it hasn’t been this high since then. 67% of condo/TH listings have been on the market for >14 days.

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