With the double whammy of layoffs in Silicon Valley and the San Francisco tourist sector destroyed by Mayor London Breed's first in the nation lockdown, rent prices in the city by the bay are doing something they rarely do, they are falling.
It appears rents are down by about 15% in Fog City as I write. The last published numbers, last week, showed rents down about 10% by they are down more now. It is a San Francisco rarity, a renters market.
At the same time, south and a bit east, Palm Springs and the surrounding desert area are experiencing a real estate boom in the middle of August heat when the area is generally shut down.
The San Francisco Chronicle reports:
The Coachella Valley, which includes Palm Springs, is having a record-breaking year that shows no sign of stopping. The median detached home prices for Palm Desert and Palm Springs have had year-over-year gains of 11.5% and 11.2% respectively, according to the Palm Springs Regional Association of Realtors. Since summer is usually considered the slow season for the hot, arid desert communities, real estate agents are predicting these gains to continue through the fall.As I have been forecasting, the things people want to buy are seeing skyrocketing prices while those that people have no interest in are falling. It is a schizophrenic economy.
Valley inventory, at 2,050 units, is at the lowest level in history. That’s almost 700 units fewer than any previous August 1st, which has led to a fiercely competitive market full of multiple bids and little to no contingencies.
“We’re getting multiple offers on almost every transaction,” said Maria Krajco, an agent with KUD Properties. “Everything is going at asking or above. There’s a lot of cash offers. There’s just a lot of money coming in."
At some point, the declines will bottom out and then you are going to see a spike in the general price indexes put out by the government. Buckle your seat belts.