Cracksinred-hot housingmarket

Inthe Bay Area housing market, supply and demand means not much supplyand way too much demand. As a result, thecostof asingle-family home has skyrocketed in recent years.

At least that’sbeen the pattern since the recession ended. And it seemed still to be the pattern as 2016 began. With interestrates low and job growth steady,buyers kept pushing up the cost of thosesingle-family homes.

Yetthere were cracks in the market’sred-hot edifice; thevolume of sales was waydown from the previous year. Some agents and experts evenbegan tomention the “leveling” word. In March, when the median price for theregion remained absolutely flat—zero uptick from the year before — the “softening” word was added to the conversation.

But the median price still stood atover $1 million in three counties (San Francisco, San Mateo and Marin), at$942,000 in Santa Clara

County and at$680,000 in Alameda County.Ifthis was a leveling, it didn’tbring much relief to middle-class buyers caught up in the housing crisis. Theyeither gave up, overstretchedtheir budgets, perhaps moved to the more affordable inland counties — or leftthe region entirely.

Newpeak prices were recorded in April, May,Juneand July —and then the “sluggish” word set in and didn’tgoawayfor the rest of the year.Sales were down. Buyers were diggingin their heels. By fall, outside of hotly contested areas,sellers were making price adjustmentsunseen in a long time.

Themarketwas losing some of its steam, and agents beganto take a wait-and-see attitude as a new president was elected and the Fed talked about increasing

Keymoments

January: About 17,000 families register interest in renting one of 115 units of new affordable housing in San Leandro.Giventhe dimensions of the housing crisis,there is “insatiable demand”for such projects,says Adhi Nagraj,directorofdevelopment for Bridge Housing,the nonprofit developer of theunits.

March: The median priceof a single-family home for the BayArea’snine counties staysflat — no uptick at all from the year before.

April: The median priceof a single-family home climbs to a new record peak in Santa ClaraCounty ($1 million),as well as in SanMateo County ($1,211,500).

May: The median priceof a single-family home for the entirenine-county region reaches a new peak: $751,000.

July: The median priceof a single-family home in San Mateo Countyhits its all-time high: $1.25 million.

November: Santa ClaraCounty votersapprove$950million inbond financing to build affordable housing.Rent control measures pass in Oakland,Richmond and Mountain View,but fail in Alameda,Burlingame and San Mateo.

interest rates.

Therental marketfollowed asimilar pattern: Double-digit, year-over-yearincreases had mostly vanished by early 2016. Consumer resistance had setin by spring.In the fall, a variety of analystsdeclared thatrents were actually falling. Yetwith an averageapartment still renting for $2,500 in San Jose, $2,927 inOakland and$3,499 inSan Francisco, plenty of rentersthrew uptheir hands.

“Youhave to leave because you just can’tsurvive,”said renter Colin Jordan, who moved withhis fiancee to Scottsdale,Arizona, and accomplished what hadbeen unattainable inthe Bay Area. They bought a house.