It’s a good thing Matthew Sell’s Oakland-based employer allows him to work remotely.
In about the same time it would take him to get there, he could complete a standard, full day on the job. Sell lives in Bermuda Dunes, near Palm Springs, with his wife, who also works for a San Francisco Bay Area employer.
Since he started working remotely early last year, the strategic marketing executive with TMC Financing engaged in a seemingly endless pursuit to find housing in the Bay Area to no avail. The duo’s chase of the American dream in Northern California led to a journey south because everything they looked at ran into at least seven figures. While searching for their dream home, they also got outbid in Palm Springs — almost eight hours away from the Bay Area.
As it turns out, the Sells shared the difficulty with many others having their offers rise to the top. According to Zillow data run specifically for the Business Journal, 42.6% of Marin County homes sold over list price in the first quarter of 2021. Sonoma County trailed with 34.6% selling over the price people were asking for in the same period, just nudging out Napa County with 33.7%.
The couple started getting outbid last summer.
“When home prices skyrocketed, no matter what we did, we would get outbid. We not only had to compete with residents, we had to contend with companies trying to buy up homes,” Sell said of a trend in this explosively charged California real estate market. “The experience would leave us in a funk for a couple (of) days, emotionally detached. We’d lose hope that we were missing out on an idea of not being in a home. But my wife is incredibly diligent. We’d just get up again and brush ourselves off.”
North Bay prospects may consider themselves lucky. Over 60% of those purchasing houses in the San Francisco metro area — anchored by the city, Berkeley, San Mateo and Santa Clara — paid way over list price.
Still, the process can be difficult here too. Sotheby’s Sonoma agent Erin George juggled a few home offers for her clients in Sonoma and Bodega Harbor in which five others were vying for the top spot. If a client offers under list, she tells them it’s “more than likely” not going to get them the house.
“Then I say, ‘You’ll be mad at yourself if you didn’t offer more,’” she said. “This is the craziest market that we’ve ever seen.”
Overbidding, lures and even bribes have been reported among prospective homebuyers in a market with a short supply of inventory and plenty of people wanting to jump into the fray.
The demand has recently increased with millennials, such as Sell and his wife, starting to buy homes with more frequency.
“It’s interesting,” Zillow Economic Data Analyst Nicole Bachaud told the Business Journal. “Last year, we had the move toward affordability with many people moving out of San Francisco. Now they’re moving back in with more (area) amenities available and higher-priced homes.”
In the North Bay, the median price keeps climbing, according to a June BAREIS data report run by Compass Realty. It found Sonoma County’s median price topping $762,500 — an $11,500 rise from the prior month. Napa County’s inched down by about that much to $857,500. Consistently more expensive Marin County maintained its median price upward motion, rising by $40,000 in one month to $1.69 million.
Is there a point in which home seekers will give up?
“There’s always a concern about buyer fatigue, when there’s so much pressure on everyone,” Compass Healdsburg Realtor Carol Lexa said. “Low interest rates are still driving this market, but there’s going to be a tipping point at some point.”