San Mateo County vs. Easy Bay Real Estate

By Raymond Stoklosa · October 22nd, 2008

San Mateo County Home Price Discount
You may have seen this article, Housing won’t see rebound until 2014, on InsideBayArea.com and wondered what is going on here. We’re telling you the worst is over, and they are telling you to settle in for the long haul. So, who is right and who is lying? The short answer is everyone and no one.

I can’t say it enough: all real estate is local. You can’t compare San Mateo County real estate to the East Bay, which is where they discuss in this article. Why you ask? Here are just a few of the main differences…

The East Bay has an abundance of buildable land. This translates to a virtual limitless supply of land for new housing/retail/commercial developments and a huge potential to increase inventory. The city and municipal governments are also comparatively much less restrictive, permit and approval costs are less as well. Finally, there is plenty of space to grow and diversify while still keeping the density low.

Quite to the contrary, San Mateo County has an acute shortage of buildable land, few parcels remain and those that do, often face tough battles by San Mateo county environmental advocates. With the geographical constraints of the San Francisco Bay, coastal mountains, City of San Francisco and the suburban sprawl of Silicon Valley, there is little potential to increase housing inventory. Adding to what currently exists would increase the population density and is considered undesirable by most residents and local governments. So, there are tough governmental restrictions on improvements and developments, including costly and time consuming approval processes.

Once you understand that, it’s basically an economics lesson. With supply locked, changes in demand have much less negative effects. To the contrary, with supply in flux, the change in demand can virtually cripple a market.

So, neither the journalists nor we, are lying to you. But it does go to show you the importance of knowing your local, or even hyper-local, market.

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