Bay Area home prices rise further as Santa Clara County joins $1 million club

Today’s San Francisco Chronicle article on home prices includes information on an important ballot initiative and a chart showing each county’s year-over-year price change. It’s important to note the only county that remained flat on that chart is Sonoma County. What that looks like on the ground in the wine country after the fires is some neighborhoods have increased in value, some are in a holding pattern while buyers weigh the impact of the fires, and others will most likely lose value. There are value opportunities in areas that one would judge as relatively safe in a fire, but perhaps slightly up in the hills.

The possibility of an initiative on the ballot that allows seniors to transfer their property tax base across county lines may have a huge impact on housing inventory and therefore home prices as early as next year. It’s a fact that those who have owned their home for decades are reluctant to go anywhere due to the low property taxes they are paying. While they have the opportunity to move once and keep that low tax base, the current law restricts them to the same county. In Marin, that means senior citizens have nowhere to move if they have interest in cashing out of a multi-story home that needs a lot of maintenance and moving to a more affordable area.

If the property tax initiative were to pass, high priced counties like Marin, San Francisco and Santa Clara would see an increase in inventory as more seniors have the ability to downsize to lower-priced areas like Napa and Sonoma Counties. Conversely, prices may increase in those less populated counties. It’s a trend that may have already started with the advent of telecommuting and flexible schedules. For those concerned with the rising home prices near San Francisco and Silicon Valley, this initiative would be the solution in my opinion that would have the most impact. I have not read and analyzed it yet, though… so I’m as in the dark as the U.S. Congress is passing a 2200 page budget.

Read the full SF Chronicle article here.