A city without city amenities — bars, restaurants, concerts, and other events — is not as attractive as it once was. This was the sentiment in San Francisco amidst Covid-19, when there was a mass exodus of city dwellers to areas with open space, easier access to nature, and more value per square foot in general. According to the US Postal Service and the San Francisco Chronicle, there were about 22,000 more change-of-address requests out of the city in 2019 than into it — close to 2,000 households a month.
Renters who were waiting for the right moment, traded city life and found a way to buy a home. But now that shelter in place orders have been lifted and more than 50 percent of people in the state have been fully vaccinated against Covid-19, what does “normal” look like? Are people making moves back into the city? Or are prices continuing to plummet as city life gets traded for the suburbs?
While some people are returning to the city, many companies are opting to allow their employees to work remotely, and that is creating a shift in city life — goodbye happy hour and power lunches, and hello working from home. In a recent report from the real estate experts at HomeLight, 95% of real estate agents across the country said they’ve seen a higher demand for residential real estate since the pandemic hit. Moreover, more than 30 percent of agents said that the real estate landscape has shifted permanently in favor of the suburbs. With remote work or partly remote work the norm, San Francisco’s busy nighttime crowds may take a hit, at least for now.
As many people move out to the burbs, there’s one population that is expected to make a comeback: millennials and Gen Zers. Real estate agents are predicting that a general desire to get back to social scenes, culture, restaurants, and nightlife will drive people back to the big cities. In fact, more than 68 percent of agents in the HomeLight survey said that people longing for city life will make their way back to San Francisco and other major cities across the country. Gen Zers and millennials are targeted to be a major part of this group, as more than 30 percent of agents in the HomeLight survey shared. That could mean greater demand for rentals, with home prices raising only slightly. As Zillow reports, home prices in San Francisco have gone up just 2 percent during the last year.
With fewer people, more space may be easier to come by in San Francisco and other major metro cities. Real estate agents in San Francisco (along with Los Angeles and New York) report condo markets that are improving and 55 percent said this category will fully bounce back post-pandemic.
While it may be some months before San Francisco returns to its post-pandemic energy, lower rents, a relatively steady market, and mild weather year-round, mean that while normal might look a little different now, city-dwellers still have many reasons to stay put.
We're constantly keeping up with the latest real estate trends and news - let us keep you in the loop!
The ZeroDown team's latest advice on mortgage qualification with uneven income...
Using data from business news reports, property management firms, and real estate experts, we have curated a list of real estate trends that resulted from people working remotely during the pandemic. Some were short-lived while some have still yet to fully play out...
Enter your email below to stay up to date with all of our articles, analyses and company news!