According to Pro Teck Valuation Services’ Home Value Forecast, which provides insight into the current and future state of the U.S. housing market, job creation in San Francisco continues to increase while housing supply remains limited, causing a significant economic displacement in the Bay Area.
The report states that over the last five years, more than 500,000 jobs were created in San Francisco with limited additions to the housing supply. Accordingly, housing prices in San Francisco have skyrocketed, pushing many people farther out to find a home.
The Home Value Forecast notes that this isn’t a new problem for San Francisco but that it has been exacerbated by the real estate crash. New housing starts tanked for three-and-a-half years after 2008, the report asserts.
Prices have risen, leaving San Francisco real estate out of reach for many. Today, the average home in the metro is $1.2 million, with continued appreciation forecasted.
The report cites the Urban Displacement Project published by UC Berkley researchers, as it states, “Gentrification, or the influx of capital and higher-income, higher-educated residents into working-class neighborhoods, has already transformed about 10% of Bay Area neighborhoods. Displacement, which occurs when housing or neighborhood conditions actually force moves, is occurring in 48% of Bay Area neighborhoods, divided almost evenly between low-income and moderate/high-income neighborhoods.”
Consequently, many working-class people who work in San Francisco are forced to move outside the metro area to places such as Antioch, Calif.
Because more people are now moving away from the metro, both commute time and traffic in the area are seeing significant increases. The report cites a recent article that rated Antioch as No. 2 in the 50 worst commutes in America, only behind New York City. The article also notes that the average commute time in Antioch is 42 minutes, with 28% of commuters having travel times of more than an hour.
To read the full report, click here.