Single-Family Homes Need Single-Family Zoning

The Wall Street Journal and the NY Times are both reporting that people all of sudden want out of dense city living and are on the hunt for single-family homes in the suburbs.  We talked about that and the associated turn away from mass transit here a month ago.  But it's not just the national media reporting generally.  Our very own high-performing realtor, Raziel Ungar, is seeing much the same thing right here in B'game as he wrote this week

It's been an adventurous week in real estate - from what I've seen, things are heating up. Two homes in Burlingame that were well priced, move in ready, and in excellent locations, had five offers each on them and sold multiple hundreds of thousands over asking. I've had more inquiries in the last few weeks from buyers living or renting in San Francisco than I can remember in a concentrated period of time; naturally, many people who may or may not have considered the peninsula, Marin, or the East Bay have placed moving to the suburbs to a home and a yard towards the top of the list. An article in yesterday's New York Times called Coronavirus Escape: To the Suburbs detailed in more detail what I have been experiencing as well.

The Journal's take on the trend is that it's not just buyers.  Renters are feeling the same need

Wall Street’s wager on high-earning suburban renters is paying off, and it is raising its stakes.  Investors are flocking to America’s mega landlords, drawn by signs the companies that emerged from last decade’s foreclosure crisis owning huge pools of rental houses are weathering the economic shutdown far better than feared. Many also expect that the coronavirus pandemic will make suburban single-family homes both more desirable and more difficult to buy for even the relatively well-heeled.

Share prices of the largest home-rental companies, such as Invitation Homes Inc. and American Homes 4 Rent, have outpaced the broader stock market since they and the S&P 500 bottomed in late March. Invitation is up 57% since then and American Homes has gained 36%, compared with the S&P 500’s 31% climb.

Perhaps you also saw the SF Comicle piece about people setting home offices in tents in their backyards to get some more private workspace.  You can only do that if you HAVE a backyard.  So the question is will the city continue to fight to protect single-family zoning, will the state bureaucrats get drawn into more pressing matters than ruining neighborhoods and will the development industry respond?  One of the rare silver-linings of the Covid-19 upheaval is according to Zumper "It seems rents for studios through 2 beds in Burlingame have seen large month-over-month drops between 5-7%".  Anyone care to guess whether or not rents would be coming down now if we had rent control in place?

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[Peter Garrison]

Saint Augustine called envy, “A strange, sad anger.”