SAN FRANCISCO—The Bay Area market is still one of the hottest in the country. According to Michael Klein, managing director and COO of Partners Capital Solutions, “The bay area is generally very strong right now as the tech sector is driving a powerful economic expansion.”
In preparation for the upcoming RealShare Bay Area conference September 4th, GlobeSt.com caught up with the Town Hall panelist on the local drivers and trends. “Foreign interest in investing in California is also a driver,” he says.
Klein tells GlobeSt.com that the very desirable areas of the City and all the way to the peninsula have experienced price appreciation and as a result, he notes, construction starts have increased. “The East Bay is getting the spill over as lower earning people and businesses leave high cost areas to the west,” he says. “Many neighborhoods are gentrifying as a result.”
He also mentions that given that real wages are not growing and rents or prices have risen quite rapidly, he expects “appreciation to moderate in all but specific locations that are attracting capital from outside of California.”
The increase in rents/price, he says, is driving construction and more product will become available to moderate price pressure.
Lastly, he notes, “we are still living with a huge unknown; what will the economy do when the Fed stops its easy money policies.”