94010: H'borough/B'game #22 in the country

The Merc did a better job of writing up the recent PropertyShark national rankings of median home prices than the Comicle did, so I will link to it here.  It notes

The Bay Area maintains its status as the most expensive metropolitan area in the U.S.  Bay Area ZIP codes made up 37 of the top 100 most expensive ZIP codes in the country, according to a new 2023 ranking by real estate data firm PropertyShark that looked at median sales prices.

In a quantification of the Doom Loop in EssEff, it notes

San Francisco only had three ZIP codes in the top 100 in 2023, a drop from the 13 it recorded in 2019.

Overall the realtor data shows

Across the nine-county Bay Area, median home prices are up 6.6% from last year, reaching $1.3 million in September, according to data from the California Association of Realtors.

Using median sales prices can be deceiving especially when there is the wider spread of prices from our combined zip code with H'borough than some others like Atherton.  And rising interest rates have locked some people into homes that they would otherwise have sold to move.  Nonetheless, numbers are numbers and ours are:

22   94010   Hillsborough/Burlingame   San Mateo County   CA     $3,200,000

Our neighbor to the south was down the list aways:

62    94402    San Mateo        San Mateo County    CA        $2,203,000

The most interesting real estate development in years happened in court a couple of weeks ago when:

A federal jury ruled on Tuesday that the powerful National Association of Realtors and several large brokerages had conspired to artificially inflate the commissions paid to real estate agents, a decision that could radically alter the home-buying process in the United States.

The realtors’ group and brokerages were ordered to pay damages of nearly $1.8 billion. The verdict allows the court to issue treble damages, which means they could swell to more than $5 billion.

It’s a decision that has the potential to rewrite the entire structure of the real estate industry in the United States, lowering the cost of moving homes by reducing commissions. Under a N.A.R. rule, a home seller is required to pay commissions to the agent representing the buyer, which sellers claimed forced them to pay excessive fees to the agents. The home sellers said the brokerages collaborated with N.A.R. to enforce what is called the “cooperative compensation rule.”

But under the verdict, the sellers would no longer be required to pay their buyers’ agents, and agents would be free to set their own commission rates, which could be slashed in half or less.

For the record, 6% of our median $3.2M sales price is a cool $192,000.  Now that is likely to change over the next few years and after the heavy realtor support for Proposition 19 (the "Death Tax") a lot of people will not be the least upset when it does.  

Comments

[Hillbilly Millionaire]

Technology will greatly disrupt this industry. It’s just a matter of time. Look at what happened to the travel industry. When was the last time you used a travel agent? Of course, no comparison to selling/buying a house but you get the idea.

[Joe]

An SF Comicle reporter named Kellie Hwang has a column named "Hella Expensive" that is hoping to be a financial advice column. Yesterday she finally clued into the Death Tax changes:

Why the math on inheriting your parents’ California home has totally changed in past years

This is especially true in California, where a law that went into effect in 2021 has dramatically changed the inheritance math, with one estate attorney calling it the “worst thing to happen in inheritance law in California in decades.”

But a living trust does not address the complexities that have arisen with California’s Proposition 19, which went into effect in 2021 and curtailed the tax benefits on property transfers between parents and children.

Under Prop. 19, the parents’ tax basis does not pass to the child. However, if the home was the primary residence of the parent before they passed away, and the child makes it their permanent family home within one year after the property transfer, they can apply to have up to $1 million of the value excluded from reassessment. Even with this exclusion, heirs are likely to see a substantial increase in annual property taxes, amounting to thousands or even tens of thousands of dollars, Button said.

Though California doesn’t have an inheritance tax, Button said Prop. 19 has basically created one. She says Prop. 19 has made it very difficult for many people to keep inherited homes because they cannot afford the additional property taxes — and she expects this issue to become only more widespread going forward.

“Most heirs are not equipped to take on a tax bill that could potentially jump from $800 to $20,000 on the death of a parent,” she said. “It will force a lot of families out of California where, before, they would have had the chance to stay.”
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We get the government we vote for and we get it good and hard.

[Spurinna]

Another reason homes aren’t selling.
Realtors pushed for this… oops.

Repeal this law for our kids.

[Chowder]

There is an effort undeway to repeal Prop 19, assisted by HJTA. If you're inclined, sign the petition to get it on the November ballot. https://reinstate58.hjta.org/