Technology jobs mean booming housing markets in Denver, San Francisco, San Jose and Seattle, as young people flock there looking for high-paying jobs. But what's great for the economy may not be so good for want-to-be homeowners.
According to the Zillow Housing Confidence Index (ZHCI), residents of these cities are feeling less optimistic about the housing market, with more people saying now is a bad time to buy than just six months ago.
Of the tech hubs in the survey, Denver had the biggest drop in people who said now is a good time to buy a home: just 46 percent in July, down from 54 percent when surveyed back in January.
San Jose had the next biggest drop with 36 percent saying now is a good time to buy, compared to the 43 percent surveyed six months ago. Seattle went down from 57 percent to 51 percent, and San Francisco went down from 45 percent to 40 percent.
"Growth in well-paying tech jobs is undoubtedly helping fuel some of the very rapid home value growth in these markets, along with low inventory and high demand," said Zillow Chief Economist Svenja Gudell. "This rapid growth can mean different things to different groups. Renters planning to buy may be turned off by rapidly growing home values, bidding wars and a highly competitive housing landscape. Many renters may need to lengthen their timelines as they take longer to save for a down payment.
“Other long-time residents may be pushed out of these cities as the cost of housing rises too far, too fast,” Gudell continued. “But for current homeowners, rapid home value appreciation means substantial gains in equity. And some sellers may decide to capitalize on recent gains in home values and list their home for sale, boosting inventory."
With home values continually on the rise in these cities, young people are less certain they'll be able to afford a home of their own. In January, 18 percent of 18- to 34-year-old renters in San Francisco planned to buy within a year. Now, that number has dropped significantly to just 8 percent. Similar patterns hold true among young people in Seattle, San Jose and Denver.
For more information about Zillow’s survey and housing data, check out Zillow Research.
from Zillow Blog - Real Estate Market Stats, Celebrity Real Estate, and Zillow News http://www.zillow.com/blog/home-buyers-major-tech-hubs-183208/
via Reveeo
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