Inventory across the nation and why single-family homes are a commodity in the Bay.

 Across the board in the United States right now, builders are putting out .5 million less homes than demand requires per year. This has everything to do with builders and investors being very trigger shy after the 2008 real estate crash. They can’t in good conscience pour money into projects that aren’t a sure thing. The number of developed lots still sitting vacant is 40 percent higher than it was before that 2008 crash.  All those developers are still feeling that loss from two decades ago. Construction is not thriving; new buildings and homes are not being pumped out. When new things do hit the scene, they are often condominiums, not single-family homes. 

It’s a problem, because the need for new homes, and more of them, is growing in a big ole way. But there’s not a lot of funding streamlined towards building projects, and in many cases, there’s limited space to build out. Hence the condos, where they can be built upwards. 

 Since 2018, a lot of states have decreased their regulatory barriers in order to inspire an uptick in the speed and efficiency of new construction. Softening regulations helps curb the cost and lessens the hoops that need to be jumped through to permit construction projects. 

So all that sounds promising, most cities do recognize it’s a problem that warrants getting ahead of by being proactive. 

Even taking all of that into consideration, the amount of single-family homes for sale across the country definitely does not keep up with the population increase. 

This is what we want to look at and explore here, because our Bay Area is a prime example of this dynamic playing out. Housing prices are staying high, because more and more buyers come onto the scene every year looking for a house, but there are simply not enough houses for sale, because more people come here, but more houses have not been built. Around here it’s as simple as there just not being new space to even build on. The Bay itself, especially San Francisco for example, has been developed to the brim, there’s nowhere to build but up. 

Alameda island is also an excellent picture of the single-family home commodity. In Alameda, all of the beautiful Victorian houses, and even the older apartment buildings, have been revamped and renovated into an “old new” house. It’s got the charm, but now with double pained windows, a smart refrigerator, and a tankless water heater. The way this plays out, in cities where the old houses are redone in order to maintain being in great shape, just means there’s no old crappy places where you can get low rent or an approachable listing price. Even little, tiny homes on postage stamp lots list for a ton of money. Blue collar families just can’t buy there anymore. Even solidly middle-class incomes, by California Bay Area standards, struggle to make it happen. Rent is also not feasible for low to middle incomes as the same limited inventory issue has bumped it way up there. 

As the increased desire to live somewhere awesome like Alameda has really gone through the roof, anything that may have been somewhat affordable before, has jacked up its cost to rent or buy. In 2024 the population of Alameda Island is 74,434 people on only 10.4 sq. miles of island. That’s dense my dudes. It’s supply and demand, they hike that sticker price, just because they can! 

But when you look at from the angle of the extreme awesomeness, like Alameda is dope, living there is so special and amazing, this isn’t all bad news. You can stop for a moment and appreciate living somewhere so wonderful that it can barely house everyone who wants a piece.

Yes, you might have to get creative, and think outside the box when envisioning and strategizing how to buy a house in a hella desirable town with a finite amount of available houses. That’s unlikely to change anytime soon, but it’s helpful to really look at why those prices are what they are. It’s important to recognize prices are high because these cities are sexy and everyone is attracted, but a lot of the good ones are taken. Don’t get scared off, there are always more fish in the sea, the Monday team will be your dedicated wingman and bring all the real estate knowledge, street smarts, strategic thinking, and badass energy to finding the perfect house and figuring out how to get you in there. This is a team who thrives on a good challenge. 

And we love the Bay Area, it’s a one of kind place to call home.