Housing prices and rents have soared in Silicon Valley

The gleaming new towers and cranes dotting the downtown San Jose skyline make it clear to residents and visitors alike that the city is changing rapidly.

Now, a new report offers a glimpse of just how significantly the capital of Silicon Valley and its smaller neighbors have been altered over the last decade. According to Apartment List, the San Jose metro area ranks seventh among the top 10 major metro areas that have experienced the most change during the 2010s.

No other region has seen rent grow more, with prices spiking more than 57 percent over the last decade. Median home value in the San Jose area has climbed almost as much, rising nearly 52 percent over the same time period. And the demographic makeup of the area is also shifting more heavily Asian, with the share of people who identify as white dropping 12.5 percent.

“We have much work to do to broaden the benefits and mitigate the misery of our Valley’s rapid changes,” said San Jose Mayor Sam Liccardo. “That’s why we’re laser-focused on expanding our supply of affordable housing, through such efforts as the backyard homes initiative and the March ballot measure, Measure E.”

In recent months, the city has tried to streamline the process of building accessory dwelling units, also called granny flats, to encourage more homeowners to build them. And Measure E will ask voters to approve a new tax that could help fund affordable housing projects and services for the homeless.

Two other California metros join San Jose in the top 10, including San Diego at 10 and San Francisco in the fourth spot. Locations that have picked up large numbers of Bay Area residents fleeing the region’s crushing housing prices and traffic woes — from Seattle and Portland to Denver and Austin — also make the list.

“Notably, the results of this analysis point to the vast influence of the tech industry over the past decade,” the report notes. “The metros on this list are largely comprised of two groups: (1) existing tech hubs that have had to navigate continued growth over the course of the decade, and (2) smaller tech hubs that have emerged over the course of the decade to compete for top-tier talent and capital investment.”

With Silicon Valley included in the San Jose metro area, the analysis says the region had already secured its reputation as the nation’s premier tech hub long ago. But, it notes, “the region’s ongoing housing crisis has meant that the area continued to see significant change in the 2010s, most notably along housing cost metrics.”

The number of tech jobs has ballooned in and around San Jose over the last decade, with companies like Google and Apple building out major campuses that are home to thousands of workers. But housing production hasn’t kept pace, particularly in suburban towns like Cupertino where residents have resisted multi-family residential development. So prices for limited housing stock have soared, leaving low-income families scrambling and, in some cases, winding up on the streets. The latest homelessness data backs that up, with San Jose alone seeing a 42 percent spike in homelessness over the last couple of years.

To the north, the San Francisco metro area saw changes similar to those that have occurred in San Jose. Median home values rose 49.5 percent over the last decade, while rents grew 42.5 percent and the share of the population identifying as white dropped 12.3 percent. However, San Francisco saw a bigger jump in the share of wealthy households than San Jose, and a greater increase in multi-family housing construction.

The report names Nashville as the most changed metro area of the last decade. Unlike in the Bay Area, Nashville’s housing costs have remained relatively affordable even as its economy has boomed.

To perform the analysis, Apartment List looked at a range of data from the Census Bureau, from population and homeownership rate to rent and household earnings.

Apartment List also put together a quiz outlining housing trends that “defined the decade,” such as a sharp 46 percent uptick in the share of millennials living with their parents.

By: Emily Deruy, Bay Area News Group. December 12, 2019

Editor’s Note: This article originally appeared on The Mercury News. https://www.mercurynews.com/2019/12/12/san-jose-among-10-most-changed-metro-areas-in-u-s/