Bay Area condo madness results in glut: Record number of luxury condos now listed on the market. Is this a sign of the peak for the Bay Area?
ByThe Bay Area housing market epitomizes the word mania. I was listening to a few real estate agents from the Bay Area and what they were saying sounds like absolute insanity. Of course, for people drinking the Kool-Aid it is hard to have any sort of perspective especially when your paycheck is tied to you believing in the mania. Hard evidence tells us that something crazy is happening in San Francisco. The median price peaked in May at a stunning $1,225,000 based on MLS sales figures. That is 65% higher than the previous peak reached and a whopping 104% higher than it was in January 2012. Mania, mania, mania. The price increase is happening so quickly that people are getting gentrified out of the market in epic fashion. You have a large numbers of foreign investors buying properties and many leave the places unoccupied. So not only do you take inventory away from those in the area that would live in these homes but you also take away potential rental property. The rental market in San Francisco is just as crazy. Builders have been building where they can especially with luxury condos. But now, at the apex of prices we now have a record glut of luxury condos. Many of these condos are sitting on the market as we enter the slow fall and winter season. The median condo price is $1,100,000. So where do we go from here?…
