Many more people telecommute for work theses days than perhaps at anytime in the past. All due to the covid-19 panic. And, there may be little doubt that telecommuting could have a caustic affect. On Bay area real estate, that is. In fact, some think that working remotely may spur a lasting shift away from onsite jobs. As a result, it may also drive an exodus from the Bay area. Since they do not need to live close to a workplace, workers will likely opt to live in lower-cost areas. And in that case, telecommuting and bay area real estate seem to be at odds. After all, people moving out results in a lower demand for housing. Then, home pricing plummets.
Telecommuting and Bay Area Real Estate Market Shifts
Home prices and rents in urban centers like San Francisco are not just pricey. They are over the top. For example, the average rent for a one-bedroom soars above $3K. And, a typical single family home price soars over $1M. As a result, it’s not surprising that telecommuters living in the area look to the suburbs. In fact, besides better pricing, a likely better quality of life awaits. Even if the move may cause a cut in pay, it seems worth the maneuver to many. Although, Bay real estate will likely suffer in the aftermath. At the same time, lower-cost markets stand to flourish.
Telecommuting and bay area real estate combined may likely create a boom. A boom in lower-cost markets, that is. And, as many companies shift to a permanent remote working model, the boom seems inevitable. As a result, pricey, limited supply markets like San Francisco real estate may face downturns. They may preside over big dips in home demand and pricing. That includes for both purchases and rentals. That just to stay in the game.
The lure of living in more remote areas isn’t going away soon. After all, the supply and variety of homes, compared to San Francisco is vast. (See San Mateo County homes for sale and the The Real Estate Report.) Also, median home price is far lower than the city’s. In fact, median U.S. home price is only about 1/5 the cost of home in the city. And, that serves to broaden the gap. It serves to increase the likelihood of a telecommuting lifestyle, removed from the urban scene.