Bedrooms and backyards will drive real estate activity in Pleasanton during 2021.
Potential homebuyers from San Francisco, the Peninsula and the South Bay are flocking to the East Bay, and the Tri-Valley in particular, searching for properties that can do quadruple-duty as a remote office, a classroom, a gymnasium and a park.
"Size of a home will be one of the top items buyers will want in a home," said Tina Hand, 2021 president of the Bay East Association of Realtors. "People need space to be able to work from home."
During 2020, single-family detached homes sold in the Tri-Valley had more bedrooms than homes sold in other parts of the East Bay.
Of the homes sold in Pleasanton during 2020, approximately 30% had three or fewer bedrooms, 50% had four bedrooms, and the remaining 20% had five or more bedrooms. Homes sold in Fremont during the same period had fewer bedrooms: almost half had three or fewer bedrooms, while about 40% had four bedrooms and 10% had five or more bedrooms.
Asked if the conventional real estate wisdom of "location, location, location" will be replaced with "bedrooms, bedrooms, bedrooms," during 2021, Hand said, "I still believe location will play a large part in buyer preference because buyers are seeking a specific location first and then looking at the number of bedrooms."
Hand said room to roam will be just as important as the number of bedrooms. "Pleasanton has nice, good-sized homes on large lots, which is on the buyers want list. It's not even a wish, it's a want," she said.
The average lot size for homes sold in Pleasanton during 2020 was approximately one third of an acre. Along the I-680 and I-580 corridors, only Danville and Livermore had homes with larger lots.
Lot sizes in Pleasanton were about twice the size of those in most of Alameda County, including Newark, Fremont and Union City. Buyers will be drawn to the larger lots found in Pleasanton that may be better able to accommodate working and playing at home.
"As long as we're under shelter-in-place, large yards are very desirable because we can't vacation like we used to so a lot of people are turning their backyards into their own oasis," Hand said.
Buyers will need to act fast and be prepared to pay top-dollar during 2021.
A home was on the market in Pleasanton during 2020 an average of 26 days, down from 31 days during 2019. The fast pace of home sales last year was exceptional given restrictions on real estate transactions in response to the COVID-19 pandemic. Real estate professionals and their clients have adapted to working safely during the pandemic, and homes in Pleasanton are expected to sell quickly during 2021.
The median sales price for a single-family detached home sold in Pleasanton during 2020 was more than $1.25 million. Homebuyer demand, and the ability to secure purchase financing, are expected to drive prices up during 2021.
Hand said, "As long as interest rates remain historically low, which allows a buyer to afford a lot more house, buyers will still be out there looking."
The record-setting sales prices during 2020 resulted from high demand and low supply. The home-seller experience during 2021 will be driven by the same market conditions homebuyers are navigating.
Hand said, "unless the seller is relocating outside of the Bay Area, if they can't find something to purchase locally, they may stay and keep their home off the market."
A new option that could benefit both sellers and home buyers will take effect in April 2021. Proposition 19, approved by California voters in November 2020, allows some homeowners to transfer their current property tax basis to another home anywhere in California. This property tax portability is expected to create more housing opportunities for homebuyers.
"I'm getting inquires from clients about Prop 19 and how it benefits them," Hand said. "More people are becoming aware that this may be a great time to sell because they can move somewhere else and take their tax base and downsize."
Editor's note: David Stark is the public affairs director for the Bay East Association of Realtors, based in Pleasanton.