Is It Really That Hard to Buy a Home in the Bay Area?

The San Francisco Bay Area is a highly competitive real estate market. You probably know that already. In fact, you might’ve heard from friends or acquaintances who have purchased homes that it can be hard to buy a house in the Bay Area.

It’s true that some buyers struggle to find or afford a home in this real estate market. There are several reasons for this, which we will address below. But it’s far from impossible. People purchase homes across the region on a daily basis. So it is certainly doable!

Below, we have explained some of the reasons why some buyers find it hard to buy a home in the Bay Area.

Why It Might Be Hard to Buy in the Bay Area

Some Bay Area home buyers coast through the process with no issues whatsoever. Others might have a hard time finding a suitable and affordable home in the Bay Area. The process can vary from one transaction to the next, due to a number of variables.

Here, we will focus on some of the challenges that might make it harder to buy a home in the Bay Area – at least for some buyers. All of these issues have to do with supply and demand, along with pricing and affordability.

1. Tight Inventory Conditions

Real estate inventory conditions can change over time. Sometimes, the supply of homes for sale increases and creates a buyer’s market type of scenario. At other times, inventory levels can plummet and create a highly competitive seller’s market situation.

In 2021, the Bay Area real estate market is experiencing very low inventory levels. This means there aren’t enough homes for sale to match the demand from local buyers.

Type supply conditions can certainly make it harder to buy a home in the Bay Area. But there are also certain things you can do, as a buyer, to navigate this issue. For instance, you might have to forgo your first-choice location in favor of a nearby city that has more properties available.

In addition to making it hard to buy a home in the Bay Area, supply constraints can also make the process take longer. But again, buyers succeed in this real estate market on a daily basis. They offer living proof that you can overcome these issues. Inventory shortages can make it hard to buy a home in the Bay Area – but not impossible.

2. Stiff Competition from Other Buyers

When the number of buyers in a local real estate market exceeds the number of properties for sale, it can increase competition significantly. In this context, “competition” takes the form of multiple-offer scenarios, bidding wars, offers above the list price, etc. All of these things can make it hard to buy a home in the Bay Area.

One of the best ways to overcome these obstacle is to make a strong offer.

Some purchase offers are more competitive than others. For instance, some buyers offer the full asking price (or more) while others might come in below the list price. Similarly, some buyers add certain contingencies into their contracts, while others choose not to.

The bottom line here is that a strong offer can make it easier to buy a home in the Bay Area, instead of harder.

3. High Home Prices

Last, but certainly not least, we have the high cost of housing within the San Francisco Bay Area. This too can make it hard to buy a home in our regional housing market.

According to Zillow, the median home value for the San Francisco-Oakland-Hayward metropolitan area was more than $1.3 million in August 2021. That’s a much higher median price point than most other cities in America. This is another factor that can make it hard to buy a home in the Bay Area, especially for those buyers who are on a tighter budget.

There’s nothing we can do to change the expensive nature of our real estate market. But there are some things you can do, as a home buyer, to overcome some of these cost-related hurdles.

For one thing, you might want to consider a broad geographical area when house hunting. Some cities within the Bay Area have much lower home prices than others, partly due to the level of demand.

Additionally, there are some things home buyers can do to minimize the upfront costs associated with a mortgage loan. Down payment gifts are one example. Most mortgage programs available today allow borrowers to use gift money from a third-party donor, like a family member or close friend.

The Path to Success Starts Here

As you can see, there are several factors that might make it harder to buy a home in the Bay Area when compared to other cities. But there are also ways to overcome many of these hurdles.

• Do your housing market research to find out what you’re up against.
• Review your financial situation and establish a monthly budget.
• Explore all of your mortgage financing options. (We can help!)
• Make a strong offer when the right property comes along.
• Be open-minded and flexible, when it comes to location and features.

These strategies, combined with good old-fashioned patience and persistence, could make it a lot easier to buy a home in the Bay Area!