Should grandparents wait for housing bubble to burst or move out of California?

Our adult son and his family cannot afford to move back into our Bay Area neighborhood thanks to ridiculous prices and bidding wars. Should he wait for the housing bubble to pop or should we leave California?

In 2020, more people moved out of California for the first time on record, creating a net migration of 261,084 people. Another record is California’s median May 2021 home price of $818,260. I’ve attended or hosted dozens of Realtor Zoom meetings with state and national real estate economists, our county assessor, housing market experts and the president of the California Association of Realtors. They all agree that this market’s significant down payments, low fixed rates and fully documented loan applications make a housing bubble bursting unlikely. They would concur that real estate prices could roll back 5% to 10% with rising interest rates and new housing construction.

No one disagrees that segments of the economy have branched off in different directions. COVID-19’s recession saw well-heeled telecommuting professionals in tech, finance and insurance see growth in jobs and income.

In Silicon Valley, the diverging economic trajectories are jawdropping. In pricey San Mateo County, May 2021 sales were up 94.4% year-overyear. Conversely, the workforce from retail, entertainment, accommodations and food services became financially needful.

In my hometown of Sunnyvale, in the heart of Silicon Valley, $2,090,000 is the median price for a single-family home for May 2021. The monthly payment for a Sunnyvale four-bedroom home with a $430,000 down payment (20%) is $9,683.00. Meanwhile, Sunnyvale Community Services provides groceries to 2,500 households a month.

In Cupertino, the home of Apple Inc., the median price of a single-family home increased 31.9% year-over-year to $2,690,000. The monthly payment for a Cupertino fourbedroom home with a $500,000 down payment (20%) is $11,267.00. In 2020, Cupertino’s community services had 4,500 households use their food bank.

Don’t wait for a U.S. housing bubble to burst. Instead, build a world-class accessory dwelling unit (ADU) in your backyard. You’ll enjoy your grandchildren sooner with maybe one very short move.

Questions? Fullservice Realtor Pat Kapowich is a careerlong consumer protection advocate and Certified Real Estate Brokerage Manager. 408-245-7700 Pat@ SiliconValleyBroker. com DRE# 00979413 www. Silicon Valley Broker.com YouTube. com/PatKapowich