
Bay Area median home price first annual drop since 2011 - boto3
https://www.sfchronicle.com/business/networth/article/Bay-Area-median-home-price-fell-2-3-last-year-14985353.php
======
JMTQp8lwXL
> The median price paid for a single-family existing home in the Bay Area fell
> from $727,000 in 2006 to $430,000 in 2009

When people talk about the bay area housing market, it's often said that it
remained strong during the GFC. This fact seems to contradict that talking
point.

~~~
twelve40
I'm not sure how useful it is to talk about the Bay Area as one market. During
2006-2010 things were very different from one zip code to another. I was just
looking at some historical Zillow data from those years and some zip codes
like Cupertino barely moved at all, for all those months. Others, like parts
of San Jose dropped by as much as 50% and just recovered to their 2006 numbers
recently. So maybe for some general sense of the numbers you can average the
Bay Area market but when it comes to pricing an actual house and trying to see
how recession-proof/prone it is, thinking of the entire SF Bay doesn't seem to
make sense.

------
curiousfiddler
This is an article from January 2020; not sure it is relevant in the current
context.

~~~
jweir
Perhaps even more relevant. If there was already a down turn.

I noticed a number (4-5) for pre-foreclosures in Berkeley right before the
shutdowns started.

Now there is a freeze on foreclosures in Ca, right? What’s going to happen
when it is lifted? I don’t think it is going to be pretty.

~~~
almost_usual
East Bay is different than SF, Peninsula, or Marin.

------
ram_rar
I am not an expert in this. Feels like, we are in uncharted territory. I was
looking at 2 main params to compare Covid crisis with 2007/08 recession.

1\. Case Shiller Index for SF area (higher the the value, higher the house
price)
[https://fred.stlouisfed.org/series/SFXRSA](https://fred.stlouisfed.org/series/SFXRSA)

2\. Financial Stress Index (Ideally should be around 0. Higher the value means
system is financially stressed)
[https://fred.stlouisfed.org/series/STLFSI2](https://fred.stlouisfed.org/series/STLFSI2)

If you compare this against 2007/08 crisis. The Case shiller index for SF
hasnt dropped much at all, even though the stress index is pretty high. Not
sure, what am I missing. Would love for HN folks to educate me on this.

~~~
dbaggerman
First thing to keep in mind is that the Case Shiller data you linked to only
has data up to February. The FSI data is more up to date, but the big upswing
was only getting started in late Feb with it being more visible in March/April
figures.

The other thing to consider is that housing prices are likely to lag behind
financial stress. If people are in financial stress, they are likely to sell
off a second car or other luxury possessions before selling their house. Also
selling a house takes time, so even when people do start selling they won't be
on the market or closing sales straight away.

------
almost_usual
In 2019. The demand in SF has actually gone up recently.

There really isn’t any incentive to sell unless you plan on buying more homes
in the Bay Area on your sale. The tax hit is too high otherwise.

------
Schnitz
Don't get too excited, borrowers have been more thoroughly vetted since the
subprime crisis and everyone is familiar enough with the cycle by now that
they'll hang on to their houses at all costs, to enjoy the recovery. Barring
foreclosures, don't expect there to be a sudden wave of deals to be had.

~~~
ram_rar
People still have to make mortgage payments though? Given, the flush of cars
sitting in the dockyard and such high unemployment rate, wont this affect
housing prices a tid bit?

~~~
almost_usual
It will affect housing prices in working class or service industry oriented
areas.

If a majority of your home owners are knowledge workers who are remote or
bought a home in cash they’ll sit on them.

If the knowledge workers get laid off then the aspiring home buyer is also
likely to be laid off. People who bought in cash will still sit on them
because they will have no reason to sell.

~~~
austincheney
That is a pretty loaded assumption about the superior financial security of
the knowledge worker. It seems clear from the numbers of developers being laid
off and start ups that are financially failing that this assumption is
imaginary.

The only financial security a knowledge worker has, in this current economic
downturn, is the essential nature of their employer or their employer's cash
liquidity.

------
3fe9a03ccd14ca5
We were able to refi, and now officially pay less for mortgage and taxes then
we would pay to rent the same home.

