Wealthy Silicon Valley Home Buyers Squeezed in Luxury Housing Crunch
LOS ALTOS HILLS (KPIX 5) -- The housing crunch in pricey Silicon Valley is not only hitting those who are barely scraping by. Even millionaires are not making money fast enough to keep up with the surging real estate market.
There's been a huge drop in the number of high-end homes on the Bay Area market. San Jose's supply plunged 42 percent since last year. Oakland and San Francisco also saw big drops.
In some cities, even having two or three million won't be enough to get you in the door.
"The least expensive house in Hillsborough is four million dollars," said realtor Dave Clark. "I just looked at Los Altos Hills, it was a little discouraging. We had quite a few houses for sale there; there were 18. But the lowest priced house in Los Altos Hills was five-and-a-half million dollars."
Earlier this week, we reported that in Santa Clara and San Mateo counties, about one out of four people is at risk for hunger because many are spending almost all of their income on rent.
"People are skipping meals, cutting back on meals or having to make less healthy choices, like having cereal for dinner," said Leslie Bacho with the Second Harvest Food Bank.
Now, it seems even the wealthy are finding that having lots of money is not enough to get a roof overhead in some communities.
"The irony is that Silicon Valley is a victim of its own success," said Clark. "So somebody who wants a nice house, a high end house, wants to pay a lot of money for a house, is very challenged."
We asked realtor Clark and his team to look up prices and what's available on the Multiple Listing Service.
While we spoke another home in Los Altos Hills was snapped up.
"It was 18 two minutes ago and now it's down to 17," said Clark. "So someone just bought another home. Another five minutes it might be down to 16. It might be down to 13 or 12 by dinner time, who knows."
And that brought up the reason this is all happening - supply and demand. This is the most severe shortage of homes for sale in all price categories in memory.
"Right now we have 447 properties for sale in all of Santa Clara County. In a normal year, it might be 10,000 or more," said Clark. "And that's the reason for every house we have on the market we get multiple offers."
The range of prices continues to go up. In Santa Clara County, there's virtually nothing available for under $500,000. On the high end, we saw a listing today of $68 million for a home in Los Altos Hills on eight acres.