As news goes, this barely qualifies: Bay Area housing prices continue to rise.
The S&P CoreLogic Case-Shiller Home Price Index, an authoritative national assessment, reported Tuesday that housing prices nationally rose 6.4 percent from February 2017 to February 2018.
And that raises an interesting question: Would we be more or less uneasy if housing prices rose 6.4 percent on the Peninsula?
Because the same index, as reported by San Francisco Chronicle’s insightful business columnist Kathleen Pender, showed prices rose 33.6 percent in Santa Clara County and 25.7 percent in San Mateo County.
Yikes.
In the 20 cities used in the index, only three cities rose by double digits: San Francisco (10.1 percent), Las Vegas (11.6 percent) and Seattle (12.7 percent).
There is no small irony in the timing of this information, which arrives about a week after the death of the bill by state Sen. Scott Wiener that would have forced cities to build with higher density and greater height around transit corridors.
Meanwhile, people are fleeing the Bay Area and California in record numbers. Right?
Well, maybe not.
In a widely publicized report from the California Legislative Analyst’s Office (LAO) and based on analysis by the U.S. Census Bureau, about 5 million people moved to California from 2007 to 2016, but about 6 million left the state – a net loss of 1 million or about 2.5 percent of the state’s total population for those of you scoring at home.
But the same report notes: “These population losses are low in historical terms.” From 1990 to 2006, “net out-migration was, on average, more than double what it was in the most recent ten years.”
So, who’s leaving and where are they going?
The LAO report says “families with kids and those with only a high school education predominate among those moving from California,” and they are moving mostly to Texas, Arizona and Nevada (which explains that spike in Las Vegas housing prices).
Remember, while 6 million left, 5 million people moved here, and that group is dominated by 18- to 35-year-olds with college degrees. Where are they coming from? New York, Illinois and New Jersey, according to the report.
That information is borne out by a less-scientific but nonetheless reliable source: the United Van Lines Annual National Movers Study. The top ten states people moved to in 2017 are: Vermont, Oregon, Idaho, Nevada, South Dakota (really?), Washington (see Seattle price spike), South Carolina, North Carolina, Colorado and Alabama. The top ten states people moved from in 2017: Illinois, New Jersey, New York, Kansas, Massachusetts, Ohio, Kentucky, Utah and Wisconsin.
So, California isn’t top ten in either category, but it remains a meaningful draw to younger, college-education people.
That’s borne out by yet another study by Livability, a website that conducts an annual ranking of the 100 best places to live in America based on nine factors, including amenities, diverse demographics, economy, education, health care and housing.
Even with the cost of housing, California cities make up 20 percent of the list. Palo Alto is ranked 6th, San Mateo 29th, Redwood City 65th and Burlingame 70th.
For those who resent “techies” who keep showing up in our communities with their hoodies, their employee badges and their disposable incomes, all these reports could be fuel for the fire, I suppose.
Or, it could be seen as more of the transition that is taking place in our economy, our communities and our demographics. Change is always hard. Generational change is deeply disruptive.
Consider, though, the presence in Redwood City of Baobab Studios, a company that is leading the way in Virtual Reality animation, essentially melding VR and animated movies as an interactive entertainment venue.
It is mind-boggling, exciting stuff and they’re in Redwood City because it’s an ideal geographic location in the midst of Silicon Valley, which is helpful in attracting and retaining bright, creative employees, said Maureen Fan, co-founder and CEO of Baobab.
Fan told Political Climate in a recent interview that she is well aware of the cost of housing in the Bay Area and has had friends who have moved away “because it’s too expensive.”
But, she noted, there are still “more job opportunities in the Bay Area. If you have the technical skills, you want to come to the Bay Area.”
Contact Mark Simon at mark@climaterwc.com.
