Where is Everyone Going?!
Idaho, Roseville, Phoenix, Austin, Denver, El Dorado Hills, Portland, Las Vegas, and Philadelphia! These are just a few of the places my Bay Area clients have moved in the last 12 months. According to new data released earlier this year by the state Department of Finance, California's population declined by 182,083 people in 2020. This is the first time that number has decreased since they started tracking it in 1900!
Who is moving away? From what I see, it’s primarily a financial decision, and there are a lot of people who are being squeezed by the increasing cost of living here. Retirees often live on a fixed income which needs to be sustainable for a longer period of time. Many working families need to adjust their cost of living and have found that they can get work out of the Bay Area. Even tech workers are finding that their companies are opening up alternate locations (Austin for example!) and discover that they are able to leave the Bay Area. Not to mention many people tell me they are tired of high-density neighborhoods and want a more rural, relaxing setting. And did I mention the number one complaint I hear… taxes?!
So what on earth is going on with the Cambrian housing market, and why is the demand up so sharply? Who is moving here? Between December 2020 and October 2021, the average sale price in Cambrian rose from $1,363,000 to $1,733,000 - that’s about a 27% increase! As I write this in mid-November, there are currently only 15 houses available for sale in our MLS area.
Here is what I’m seeing: there are a LOT of families who make a lot of money in tech jobs, who are still renting, and who want to be homeowners. With the low-interest rates, there is a “fear of missing out” (FOMO) and an increased sense of urgency to purchase. Not to mention that the stock market has been on a tear lately and many buyers are flush with stock options that are way up in value. I’m also noticing a large number of move-up buyers who are outgrowing their current condos and townhouses and who now have the strong desire to get into a home that will get them through the next 10 years. Cambrian has always been a very desirable area because it’s centrally located, has excellent schools, and is still moderately priced compared to other sought-after and central locations. I also notice quite a few downsizers who move into Cambrian because the homes are a perfect size and most are one story!
It’s hard to say how long this imbalance of supply and demand will keep the prices rising. An increase in rates, a decrease in the stock market, and possibly just time passing, all could help settle out the market. Until then, best of luck to you if you’re a buyer, and congrats in advance if you’re a Cambrian home seller!