Average sales price SF bay Area 936k ??

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Average sales price SF bay Area 936k ??

Jay HinrichsBusiness Member
Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes

I saw a TV show talking about the average sales price in the Bay area at 936k  along with some tear downs in Freemont selling for 1.1 to 1.3  it was crazy even for someone like me who bought their first home in the late 70s in Milpitas for 79k and it was a new construction Shapel home  LOL.

So I have to think back to E. Palo Alto and in those same years I was buying foreclosures there for 12 to 20k and flipping them making 5k a home and thought I was the smartest guy on the planet.. 

Now I have started to buy in Richmond I cant for the life of me understand why there is not more talk about Richmond were you can buy at 1/3 the market value of the rest of the bay area and it can be re gentrified and fixed up.. Just like E PA and parts of Oakland etc.

with the new Ferry the proximity to jobs  Seems like a no brainer to get ahead of the curve or the herd as it were ?   big money is made in path of progress ??? at least that's my thinking... anyone agree or you think I am nuts.

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Ori SklootPro Member
Investor · Berkeley, CA · Member since 2016 · 242 posts · 304 votes
8y

I don't see many answers from people who actually own property in Richmond.  I own both MFH and SFD in the Iron Triangle and North Richmond areas.  These are among the worst areas of Richmond and if you listen to some of the posters, some of the most dangerous place in the world.  I've spent a lot of time in these area over the past 5 years, and like many places in the Bay Area they have changed a lot.  5 years ago I wouldn't dare walk alone in these areas, now I'm rehabbing a house in a "bad" part of Richmond and it's a completely different feeling.  There is an open park across the street where they have community gatherings and salsa dance classes.  Kids are out in the streets riding bicycles.  People pass you in the street and say hello.  The folks who avoid Richmond at all costs and point to statistics and news clippings probably haven't spent much time in Richmond lately.   

Richmond has many, many things going for it that is bringing gentrification: proximity to a diverse pool of jobs (and not dependent on tech), infrastructure going in (Richmond ferry terminal), non-profits building affordable-housing (the good kind), old HUD and Richmond Housing Authority properties are in the long-process of being torn-down and sold off so that ugly lots and abandoned houses will eventually be revitalized.

I think @Jay Hinrichs you've got a great play.  I think Richmond is going to have a similar trend as West Oakland (which by the way feels as safe to me as most parts of Richmond).  You will probably be sitting on some of those North Richmond lots for a while, but if you are finding lots in South/East Richmond I think they have already gained a lot of value over the past few years.  Anyone looking to buy in the Bay Area for solid cash flow and good appreciation should look at Richmond.

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  • Joseph M.
    Flipper/Rehabber · Los Angeles, CA · Member since 2009 · 1k+ posts · 732 votes
    8y

    @Jay Hinrichs , yeah I have bought some land to flip in the past through tax sale auctions , not in that area but in San Bernardino and Riverside counties mostly.  Still a lot of land here in CA despite the image of it being overcrowded.

    Yeah the project does sound exciting .

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  • Jana CainPro Member
    Enrolled Agent · Richmond, CA · Member since 2016 · 225 posts · 148 votes
    8y
    Originally posted by @Amit M.:

    @Jay Hinrichs so are you buying one off lots located here and there, or more of a larger development, say 10-20+ homes on one site? The former may be hit or miss. But if you’re doing small developments, then you have the benefit of creating a gentrification play yourself, as those 10-20 homes will have gravitas, and you can actually influence that location. If you’re acquiring one off lots, then parts of Oakland may gentrify faster. Not sure if there are more vacant lots in Richmond vs Oakland per capita. Usually ghettoish (or recently improved ghettos) have vacant lots because of fires that owers haven’t rebuilt on. 

    The other thing to look into is the amount of housing projects and low income housing tracts (they may look like suburban SFH's, but are low income) in your immediate area. I know that Richmond has become a dumping ground for relocated low income, as much of the older housing projects in SF are shutting down, and getting rebuilt, still as affordable housing, but with private management that won't tolerate riff raff. And some of that riff raff heads to Richmond.

    I’ll also tag @J. Martin as he has property in Richmond...though he may be a bit checked out with his worldly travels...beaches in Thailand, pat pong, god knows where are usually not conducive to real estate analysis requiring finger on pulse awareness. But let’s try..

    The "riff raff" from SF has actually been heading to Stockton and Antioch, Richmond much less so. 

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  • Jay HinrichsBusiness Member
    OP
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    8y
    Originally posted by @Joseph M.:

    @Jay Hinrichs , yeah I have bought some land to flip in the past through tax sale auctions , not in that area but in San Bernardino and Riverside counties mostly.  Still a lot of land here in CA despite the image of it being overcrowded.

    Yeah the project does sound exciting .

    between the turn of the century and 1930 ish over 2 million lots were created in those two counties those are basically the biggest counties in size in the US.. you see evidence of it.. when you see a MH stuck what looks like in the middles of nowhere but those are all platted parcels..  the undeveloped lot and tax sale game has been going on like I said since the 20s out here on the west coast.

    I got two letters this week in fact on old lots of my dads in N CA.. 

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  • Sam Josh
    Sunnyvale , CA · Member since 2017 · 373 posts · 362 votes
    8y
    At this time any optimism on Richmond (or east Oakland or Stockton) is pegged to the continued expansion of the tech industry, rapid creation of new tech jobs, double digit growth in home prices in central and desired areas. I think if Tech continues to boom, there is a spillover opportunity for gentrification in Richmond or Oakland. As such kind of talk boils up, my memory goes to 1999, when the world was salivating over Morgan Hill and Coyote Valley in South San Jose. This in anticipation that those areas will be the spillover beneficiaries of tech growth. Yup the infamous Cisco campus story etc!!! Unfortunately that did not happen and those areas were hurt quite bad in the first recession and then the Great Recession. Of course they have come back over the past 3 years. So even if one took a long view back in 1999, one had to be very patient to see results. So a lot of stars need to align to have Richmond shine and gentrify. Remember even today an overwhelming part of Oakland is yet to be gentrified. So it looks like a long road that sits on the back of a sustained boom.
    0Reply
  • Amit M.
    Rental Property Investor · San Francisco, CA · Member since 2013 · 1k+ posts · 1k+ votes
    8y

    @Jay Hinrichs so how much are we talking about for a typical Richmond lot? I'm assuming most are SFH and not multi? $50-100k? Yeah at that price I can see parking some money for a 10-20 year horizon.

    0Reply
  • Anthony Wick
    Rental Property Investor · Ankeny, IA · Member since 2017 · 2k+ posts · 3k+ votes
    8y
    I left Cali in 2010 and never looked back. I’m living like a king in the Midwest compared to Cali. Multiple properties owned, and lavish vacations. In Cali, was paycheck to paycheck on $100k salary.
    0Reply
  • Ori SklootPro Member
    Investor · Berkeley, CA · Member since 2016 · 242 posts · 304 votes
    8y

    I don't see many answers from people who actually own property in Richmond.  I own both MFH and SFD in the Iron Triangle and North Richmond areas.  These are among the worst areas of Richmond and if you listen to some of the posters, some of the most dangerous place in the world.  I've spent a lot of time in these area over the past 5 years, and like many places in the Bay Area they have changed a lot.  5 years ago I wouldn't dare walk alone in these areas, now I'm rehabbing a house in a "bad" part of Richmond and it's a completely different feeling.  There is an open park across the street where they have community gatherings and salsa dance classes.  Kids are out in the streets riding bicycles.  People pass you in the street and say hello.  The folks who avoid Richmond at all costs and point to statistics and news clippings probably haven't spent much time in Richmond lately.   

    Richmond has many, many things going for it that is bringing gentrification: proximity to a diverse pool of jobs (and not dependent on tech), infrastructure going in (Richmond ferry terminal), non-profits building affordable-housing (the good kind), old HUD and Richmond Housing Authority properties are in the long-process of being torn-down and sold off so that ugly lots and abandoned houses will eventually be revitalized.

    I think @Jay Hinrichs you've got a great play.  I think Richmond is going to have a similar trend as West Oakland (which by the way feels as safe to me as most parts of Richmond).  You will probably be sitting on some of those North Richmond lots for a while, but if you are finding lots in South/East Richmond I think they have already gained a lot of value over the past few years.  Anyone looking to buy in the Bay Area for solid cash flow and good appreciation should look at Richmond.

    4Reply
  • Jay HinrichsBusiness Member
    OP
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    8y

    @Ori Skloot  One block at a time.. I just look at my 40 years of actively investing in Real Estate and growing up in the Bay Area .. one thing is certain the economic bay area engine is such that is sucks up many of the areas and changes them

    if one can get on the front end good things can happen for the investor..  Please note I am not making a run on vacant lots in Detroit  LOL.. 

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  • Amit M.
    Rental Property Investor · San Francisco, CA · Member since 2013 · 1k+ posts · 1k+ votes
    8y

    @Jay Hinrichs what is the price range for the lots you’re targeting?

    0Reply
  • Jay HinrichsBusiness Member
    OP
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    8y
    Originally posted by @Amit M.:

    @Jay Hinrichs what is the price range for the lots you’re targeting?

    sent you a PM !!! 

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  • Ratesh D.
    Rental Property Investor · San Jose, CA · Member since 2018 · 18 posts · 4 votes
    8y

    @Jay Hinrichs What size lots are these? Thoughts on lots in Oakland area given they're closer to SF/East Bay?  

    0Reply
  • Jonathan PfluegerPro Member
    Ben Lomond, CA · Member since 2016 · 338 posts · 337 votes
    8y

    @Ori Skloot

    What parts of Richmond are you looking to invest in now? I am from the Santa Cruz area and have been looking into the East Bay for potential investing. Richmond seems like it is under-appreciated and over-looked but I don't have the feet on the ground experience to really gauge this. 

    0Reply
  • Joseph M.
    Flipper/Rehabber · Los Angeles, CA · Member since 2009 · 1k+ posts · 732 votes
    8y
    Interesting article today about the ferry in the SF Bay chronicle — Soon-to-open Richmond ferry terminal could revive shoreline, usher in gentrification https://www.sfchronicle.com/bayarea/article/Soon-to-open-Richmond-ferry-terminal-could-revive-13052464.php
    0Reply
  • Jay HinrichsBusiness Member
    OP
    Real Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
    8y
    Originally posted by @Joseph M.:

    Interesting article today about the ferry in the SF Bay chronicle
    —

    Soon-to-open Richmond ferry terminal could revive shoreline, usher in gentrification

    https://www.sfchronicle.com/bayarea/article/Soon-to-open-Richmond-ferry-terminal-could-revive-13052464.php

     I hate being right all the time   BIG fat LMAO

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  • Chris MasonPro Member
    Moderator
    Lender · CA · Member since 2015 · 9k+ posts · 10k+ votes
    8y

    Relevant article from SF Chronicle. 

    Snip:

    More at link.

    0Reply
  • Michelle Harris
    Investor · San Francisco, CA · Member since 2017 · 7 posts · 3 votes
    8y
    Originally posted by @Sam Josh:

    At this time any optimism on Richmond (or east Oakland or Stockton) is pegged to the continued expansion of the tech industry, rapid creation of new tech jobs, double digit growth in home prices in central and desired areas. I think if Tech continues to boom, there is a spillover opportunity for gentrification in Richmond or Oakland.

    As such kind of talk boils up, my memory goes to 1999, when the world was salivating over Morgan Hill and Coyote Valley in South San Jose. This in anticipation that those areas will be the spillover beneficiaries of tech growth. Yup the infamous Cisco campus story etc!!!

    Unfortunately that did not happen and those areas were hurt quite bad in the first recession and then the Great Recession. Of course they have come back over the past 3 years. So even if one took a long view back in 1999, one had to be very patient to see results.

    So a lot of stars need to align to have Richmond shine and gentrify. Remember even today an overwhelming part of Oakland is yet to be gentrified. So it looks like a long road that sits on the back of a sustained boom.

    yeah- it seems like every time Stockton and Sacramento get mentioned as "spill over" locations for bay area residents getting priced out- we are near a top.  This has been true all the way back to 1989 and maybe before that.  Close-in bay area real estate, even in some sketchy areas like Oakland, holds its value - but these outlying areas never seem to hold on.

    1Reply
  • Rob Beardsley
    Rental Property Investor · New York, NY · Member since 2017 · 300 posts · 168 votes
    8y

    I am from the Bay Area as well and have definitely seen the effects of gentrification. I don't see a reason why the whole bay area, but specifically the cities surrounding Silicon Valley, won't be completely gentrified in a number of years. Although I'd have to analyze Richmond and potential deals more closely to give an accurate answer, it seems that there could be great potential there. Good luck

    0Reply
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