People leaving SF- Where are they headed?

Question

Hello BP universe!

I just read an article about people fed up with the San Francisco housing market because it's "too damn high" and are "leaving in droves!" 46% of residents plan to leave soon but where are they going? Below are the top 10 places people are looking to move to.

10. Stockton, CA
9. Salt Lake City, Utah
8. Hawaii (my home state yah!)
7. Phoenix, Arizona
6. Las Vegas, Nevada
5. Austin, Texax
4. Denver, Colorado
3. Sacramento, CA
2. Portland, Oregon
1. Seattle, Washington

Just wondering who out there are already investing in these markets or plan to? I personally have investments in Sacramento and Stockton. I'm looking to expand to Las Vegas and back in my home state of Hawaii. Would love to hear about other people's experiences investing in these areas!

Check out the article below and let me know what you think!

http://www.businessinsider.com/san-francisco-housing-so-expensive-people-leaving-2018-4#2-portland-oregon-9

Dan Burstain · Answer

Take a look at the average median price from your list. In my opinion, Austin is the place to invest. Rated the #1 city to live in now two years in a row. Huge job growth with extremely stable economy (government and university largest employers) with medical sector about to explode here and of course tech is booming as well. 11th largest city in the nation and predicted to double in size within 20 years. That, and you can still buy a brand new 4 bedroom home with wood floors and granite counters less than 30 minutes from downtown for less than $250K.

10. Stockton, CA $312K

9. Salt Lake City, Utah $301K

8. Hawaii (my home state yah!) $530K

7. Phoenix, Arizona $240K

6. Las Vegas, Nevada $240K

5. Austin, Texax $251K

4. Denver, Colorado $360K

3. Sacramento, CA $359K

2. Portland, Oregon $350K

1. Seattle, Washington $417K

10. Stockton, CA   $312K

9. Salt Lake City, Utah   $301K

8. Hawaii (my home state yah!)   $530K

7. Phoenix, Arizona  $240K

6. Las Vegas, Nevada  $240K

5. Austin, Texax  $251K

4. Denver, Colorado  $360K

3. Sacramento, CA  $359K

2. Portland, Oregon $350K

1. Seattle, Washington  $417K

Joel Fine · Answer

I've lived in the SF Bay Area for 30 years now. Purchase prices have outstripped rental rates, so investment properties won't come anywhere near positive cash flow. 1% rule? Ha! Try 0.2%!

I've just bought my first investment property, in Austin, and will likely buy more. The combination of high tech, medical, and decent climate makes me bullish on the region.

David Hutson · Answer

I'm in Sacramento.  I'm an investor and an agent so I am seeing the movement from both sides.  Almost half of my sales are to people from San Francisco.  Some are definitely trying to get out of the bay area.  Many are selling there and paying cash to buy homes here, which leads me to the median price post above.  I disagree with the Trulia statement listing Sacramento's median price as flat "0".  All of the prices I'm seeing are higher and from other sources and meetings I go to I think the median "middle" price is higher.  We may not be the best market but we are definitely selling fast and at above asking price, usually with multiple offers if the home is listed at a reasonable price.

Sherwin Gonzales · Answer

@David Hutson, yup, that's exactly what my in laws did a few years ago. They are retired, was sick of the expenses of living in SF and got more of a house for their money in Elk Grove. Now they are enjoying their pool, their nice big house, and I get to go visit them 1-2 times a month and also get a chance to look at investment properties in that area!

David Hutson · Answer

@Sherwin Gonzales, They are people who are moving here.  Many of them are retiring/retired and tired of the expenses/taxes/lack of parking, etc.  I know several people who commute to the bay to save money.  A few rent rooms out there and stay for several days at a time and come home on the weekends.

Sherwin Gonzales · Answer

@David Hutson thanks for your comments! Are your sales to people from San Francisco investors or people who actually are moving to live in Sacramento? I've met a handful of people who commute from Sacramento everyday to either SF or Oakland for work. It just seems crazy but with the high cost of living in SF and the rest of the Bay Area, people are looking for alternatives of where to live and grow their family. You can get a nice big house in Sacramento, but would have to sacrifice the time of your commute if you work in the city.

Jim Cummings · Answer

@Sherwin Gonzales. There is probably a lot of Volcano Front Property that can be bought economically on the big island! (:>)

Sherwin Gonzales · Answer

@Dan Burstain and @Bill Brandt appreciate you both with the numbers and insight!

@Becca Summers, thanks for the info regarding Utah! I didn't know Facebook is planning on building a data center there? I did read that Facebook may move away from Silicon Valley due to the high housing costs.  Check out the article below.

https://www.bisnow.com/san-francisco/news/office/bay-areas-housing-crisis-could-chase-facebook-other-tech-companies-away-89204

@Sam Josh, it seems I may have been misunderstood. I didn't mean to solely use these articles to base investment decisions. I merely posted this to start a dialogue and discussion about people's opinions regarding this information presented to us. In my personal experience, my wife and I have good jobs, good income, and strong career prospects and guess what? We moved away from SF to buy a house in Oakland. Now, we may be a minority, but according to the random article below, you would need to make an annual income of $303k to buy a median priced home in San Francisco.

https://www.sfgate.com/realestate/article/income-needed-buy-home-San-Francisco-real-estate-12614111.php

But then again, these are just articles and opinions of the writers and like good investors we are, we should base do our due diligence and research on many different resources.

Becca Summers · Answer

@Sherwin Gonzales I am seeing a lot of cash investors coming to Utah from Texas, Florida, and California. I think the reason is our economy is awesome unemployment is less than 3% job market is crazy. Facebook just announced they are building a data center just 30 minutes south of Salt Lake which is bringing in infrastructure in the area.

Housing is being pushed up though, The price put down for our average is probably all housing combined. The single-family inventory is closer to $340,000 in Salt lake and $330,000 in Utah County.

If you ever know someone wanting to invest in Utah County or Salt Lake County I'm happy to help as an investor myself.

People leaving SF- Where are they headed?

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