High-flying and fast-climbing prices, crazy bidding wars — is the Bay Area housing market starting to feel like a bubble?
Homeowner equity in the Bay Area has soared during the COVID-19 pandemic, with San Mateo and Santa Clara counties having the highest percentage of equity-rich households in the United States, according to an analysis of mortgages and home values by real estate analytics firm Attom. Equity is the difference between what a homeowner owes on a house and what a house is worth.
More than 7 in 10 homeowners in the two counties have more than 50% equity in their properties, a substantial rise in personal wealth even as high unemployment and economic suffering continues in other parts of the community.
“Equity levels at both ends of the spectrum improved in the Bay Area, as they did throughout the country. That’s mainly because most homeowners were still able to pay their mortgages at a time of rising home values,” said Attom executive Todd Teta. “Even those who lost their jobs and couldn’t keep up with loan payments saw equity get better simply because home values kept increasing.”
Median home prices in the Bay Area during COVID mirrored the national trend — they soared. Local home prices rose from $1.01 million in March 2020 to $1.35 million in June, a 34% gain.