san francisco center for economic development

June/July 2013

Unemployment

The unemployment rate in California dropped to 8.6 percent in May, down from 10.7 percent during the same period last year. All Bay Area counties posted slight decreases over the previous year, and the lowest unemployment rates statewide were once again in the Bay Area counties of Marin (4.5 percent), San Mateo (4.9 percent) and San Francisco (5.2 percent).

Elsewhere in California, notable county unemployment rates included Orange (5.5 percent), San Diego (6.7 percent), Los Angeles (9.2 percent) and Sacramento (8.0 percent).

Bay Area Unadjusted Unemployment Rates, May 2013

County

May-13

Apr-13

Mar-13

Alameda

6.8%

7.0%

7.8%

Contra Costa

6.7%

7.0%

7.8%

Marin*

4.5%

4.6%

5.2%

Napa

5.3%

5.9%

6.8%

San Francisco

5.2%

5.4%

6.1%

San Mateo

4.9%

5.1%

5.7%

Santa Clara

6.2%

6.5%

7.2%

Solano

7.6%

8.1%

8.9%

Sonoma

6.1%

6.5%

7.3%

*Lowest in state. Source: CA-EDD

Historical Unemployment: California, San Francisco, USA

Source: EDD, Monthly

Housing

According to DataQuick, the median price paid for a Bay Area home rose 30.8 percent from $390,000 in April 2012 to $510,000 in April 2013. This is the first posting above the half-million-dollar mark in nearly five years.

"There's somewhat of a perfect storm here, statistically speaking. The pent-up demand, the economy, interest rates, investor buying. Everything is in alignment right now, but that won't always be the case. A major element to watch for between now and fall is how many homes are put on the market at these higher price points," said John Walsh, DataQuick president.

A total of 7,621 new and resale houses and condos were sold in the nine-county Bay Area in April. That was up 5.2 percent from 7,243 the month before, and down 0.6 percent from 7,667 in April 2012. Sales have fallen year-over-year for three consecutive months, mainly reflecting constrained inventory.

Indicators of market distress continue to decline. Foreclosure activity remains high by historical standards, but well below peak levels reached several years ago. DataQuick reported that financing with multiple mortgages is low and down payment sizes are stable.

Bay Area Home Sales: Volume and Median Price

All homes

Sales Volume

Median Price

Apr-12

Apr-13

%Chng

Apr-12

Apr-13

%Chng

Alameda

1,523

1,471

-3.4%

$335,000

$448,250

33.8%

Contra Costa

1,546

1,482

-4.1%

$288,750

$397,500

37.7%

Marin

292

345

18.2%

$618,000

$799,000

29.3%

Napa

120

136

13.3%

$317,500

$385,000

21.3%

Santa Clara

1,862

1,788

-4.0%

$513,500

$645,000

25.6%

San Francisco

529

615

16.3%

$700,000

$815,000

16.4%

San Mateo

708

609

-14.0%

$550,000

$726,000

32.0%

Solano

557

564

1.3%

$175,000

$238,000

36.0%

Sonoma

530

611

15.3%

$304,500

$376,000

23.5%

Bay Area

7,667

7,621

-0.6%

$390,000

$510,000

30.8%

Source: DataQuick, www.DQNews.com

San Francisco Residential Market Overview

Single Family Homes

Condos/TICs/Lofts

2-4 Units

Median Sales Price, last 180 days

$848,000

$780,000

$1,200,000

% Change from prior 180 days

10.2%

8.5%

4.3%

Avg. Days on Market, last 180 days

44

49

74

% Change from prior 180 days

-9.3%

-12.5%

15.4%

Source: Real Estate Update for San Francisco Homebuyers and Sellers

Foreclosures Dropping Fast

In California, total foreclosures dropped 55.1 percent year-to-year during Q1 2013, to 13,591. Default notices statewide dropped 67 percent, from 56,258 in Q1 2012 to 18,567 in Q1 2013.

Bay Area Foreclosures

County/Region

2012 Q1

2013 Q1

Yr/Yr%

Notices of default

San Francisco

340

103

-69.7

Alameda

1860

555

-70.2

Contra Costa

2251

785

-65.1

Santa Clara

1496

441

-70.5

San Mateo

612

216

-64.7

Marin

209

87

-58.4

Solano

1146

345

-69.9

Sonoma

698

194

-72.2

Napa

179

46

-74.3

Bay Area

8791

2771

-68.5

Source: DataQuick IJ Chart

Commercial Real Estate

San Francisco's office market ended Q1 with a net positive absorption of 354,233 square feet. Class A Direct Asking rates remained high, at $52 per square foot and up, and rents in the tech-heavy SOMA district averaged more than $60 per square foot.

The direct vacancy rate in the downtown core stands at 9.0 percent; citywide it is 10.4 percent.

New office construction underway in Q1 amounts to approximately 2.4 million square feet.

bay area vacancy rental rates

Source: Tri Commercial

Venture Capital Investment

VC investment in the Bay Area decreased by 19 percent over the last three quarters. During the last two quarters, the number of deals also dropped, by 2 percent. Despite this reduction, the Bay Area continues to receive more than triple the investment of the second-most popular region for VC investors, New England.

bay area venture capital

Source: MoneyTree Report Q1 2013

SFO - Ten-Year Infrastructure Plan

Mayor Edwin M. Lee announced a $4.1 billion capital improvement plan for San Francisco International Airport (SFO). The long-term infrastructure plan provides funding for terminal improvements, facility enhancements, and the creation of an on-site luxury hotel, pending environmental approval. The plan is expected to create more than 36,000 jobs over the next 10 years.

Source: Sfgov.org


Rankings

Top 5 World Cities for an Innovation Economy in 2012-2013

  1. Boston
  2. New York
  3. Vienna
  4. San Francisco Bay Area
  5. Paris

Source: Global Innovation Agency


Forbes Best Big Cities in the US for Jobs in 2013

  1. San Francisco-San Mateo-Redwood City, CA Metropolitan Division (2012 Employment Growth: 4.1 percent)
  2. Nashville-Davidson-Murfreesboro-Franklin, TN (2012 Employment Growth: 3.8 percent)
  3. Salt Lake City, UT (2012 Employment Growth: 4.0 percent)
  4. Fort Worth-Arlington, TX Metropolitan Division (2012 Employment Growth: 3.8 percent)
  5. Houston-Sugar Land-Baytown, TX (2012 Employment Growth: 2.0 percent)
  6. Dallas-Plano-Irving, TX Metropolitan Division (2012 Employment Growth: 3.5 percent)
  7. San Jose-Sunnyvale-Santa Clara, CA (2012 Employment Growth: 3.4 percent)
  8. Charlotte-Gastonia-Rock Hill, NC-SC (2012 Employment Growth: 3.3 percent)
  9. Denver-Aurora-Broomfield, CO (2012 Employment Growth: 2.8 percent)
  10. Austin-Round Rock-San Marcos, TX (2012 Employment Growth: 3.7 percent

Source: Examiner.com


Bay Area Tops Employee Satisfaction Survey

San Francisco-based Glassdoor.com ranks San Jose and San Francisco #1 and #2 for employee job satisfaction, in a June report of the 50 largest US metro areas, based on at least 500 reviews for each area over 12 months. Seattle, Salt Lake City and Washington, D.C., rounded out the top five. Los Angeles placed 26th, Chicago 40th, and New York 44th. Glassdoor cites San Jose and San Francisco as "both recognized as global tech hubs and regions for innovation."

Source: Glassdoor.com


Bloomberg LP to Test Venture Capital Waters in San Francisco

Bloomberg LP is expected to launch a $75 million venture capital fund that will provide the financial information outlet with a window to the fast growing world of start-ups. Bloomberg Beta will operate as a separate legal entity from Bloomberg LP, and will be based in San Francisco. Bloomberg Beta will invest in early stage start-ups (Series A), as well as providing seed investment. It will focus on start-ups that are "producing insights from data" and "making the experience of work better," fund representatives said in a news release. According to VentureBeat, the fund has already invested in start-ups Newsle, Nodejitsu, Codecademy, Errplane, and ProsperWorks.

Source: Sfgov.org


Quickfacts is produced by the San Francisco Center for Economic Development (SFCED).
For more information, please contact:

Dennis Conaghan
Executive Director
dconaghan@sfced.org

Please note our new location and contact number:
235 Montgomery St., 7th Floor, San Francisco, CA 94104
Tel: 415.352-8855

Find us on Facebook! Become a fan of our page to receive daily news updates. Just visit our website at www.sfced.org and click on the Facebook icon.

If you would like to opt out of QuickFacts, please click info@sfced.org and request to be removed from our mailing list.