In an already pricey real estate market, San Francisco’s median home price has just hit the $1 million mark, according to a new report from industry info firm DataQuick.
To figure out what’s going on in the city by the bay, Here & Now’s Jeremy Hobson turns to Nancy Wallace, co-chair of the Fisher Center for Real Estate and Urban Economics at the University of California, Berkeley.
According to Wallace, if someone were looking to buy a house in San Francisco for that median price, “Probably [they] could get single family residential — two bedrooms and one bathroom,” though she adds that it varies based on the neighborhood’s amenities.
This rise in prices is due to a growing demand and constant supply, she says, as tech companies have grown rapidly in recent years while construction halted during the recession. A new construction boom is focused on building apartments — which means that the single family residential market still holds a premium.
While Wallace holds that these prices are not unexpected to most Bay Area residents, she says as long as current federal economic policies remain in place, prices will stay high.
“I think we have to be careful with the new normal — everything about the economies is affected by fed policies with respect to interest rates,” she explained. “These interest rates are not normal and they’re intended to be stimulative. When you have a market that’s overheating, as we have here, there’s nothing to curb it.”