BAY AREA SLOWEST EXPANDING AREA IN US
May 02, 2016
The era of hypergrowth in Bay Area expansion is over. Though the region saw a sustained outward growth since 1940, the trend fell to a trickle in the 2000s.
The Greater San Francisco market has slowed considerably, according to data from BuildZoom. Expansion rates have fallen 75.4% since the ’70s, making the Bay Area the “the slowest expanding metropolitan area in the United States.” The national average fell by just 15.3% during the same period.
BuildZoom chief economist Issi Romem cites constraints on the San Francisco’s Bay Area’s supply of housing as a key driver. “San Francisco’s extreme position at the expensive end of the chart stems from the combination of Silicon Valley’s economic might with the city’s confining natural geography,” he tells Bisnow. Economic growth has been channeled into rising home prices instead of increasing housing stock. He further cited restrictive state and local land use regulation in the name of environmental protection as a factor.
The end result is an upward spiral of prices that lead to a middle class exodus from cities like San Francisco and Boston to growing cities like Atlanta, he said.