Saturday, March 30, 2013

Oakland Housing Bubble Back?

Amid the constant reports of burglaries, murders and other crime problems in Oakland, it's surprising to see Oakland in the middle of housing bidding wars.

Here's an article you should check out. I'm not sure it's particularly actionable, but it's interesting nonetheless.

A couple key quotes:
Buyers looking at homes priced at $1 million and above in the Oakland area are bidding 20 percent to 40 percent above list price, Garner said.

To drum up sellers for her buyers, Garner's getting in touch with the owners of last year's expired listings. She also advises buyers to talk to their friends, and at community gatherings like farmer's markets she puts out the word that it's a sellers' market.

The buyer had made an offer on a home but lost out when the home sold for $400,000 more than the list price. Her client could have afforded to purchase at that price, but got cold feet about paying so much above the list price -- about 30 percent -- and dropped out.

I believe a key background to all of this is the rapid progress of gentrification in the area.


  1. As a practicing Realtor in Oakland... most of the above statements don't wash. We occasionally see a $100K over asking close... seldom, if ever, more. Usually the result of intentional "teaser" pricing. Bubble? You bet. An explosion of new inventory, at excessively ambitious prices, is now hitting the market... coupled with interest rate creep (some expect mortgages to reach 6% by year's end... I'm not that pessimistic)and you have a real flattening, or a dip, in the rate of real estate appreciation.

  2. I've heard more than once that the key is the schools. That's one reason I always come back to the magnet-school issue. If Oakland just created a magnet middle school, property values would shoot up. This would in turn create more tax revenue to spend on stuff like social programs. I don't get why liberals aren't falling all over themselves to do it!

  3. Get real. The #@!*% unions run the schools. They're in business to enrich their dues-payers (and promote their Commie agenda). Period! Vouchers are the way out. Personally, I would rather abolish public shools... but political reality compells something short of that.

  4. I think one big difference between this market and the last bubble is that about 30% of transactions are all cash..whereas before many buyers were using 100% financing.