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April 13th, 2019 by Marco Santarelli
Oakland Real Estate Market 2019 Statistics
If you were researching the California real estate market lately, you’d find that Oakland rental houses are being touted as the best place to invest your money. The question for those outside of the region is: why? In this article, we will be providing you ten reasons to invest in the Oakland real estate market in 2019. If you are a home buyer or real estate investor, Oakland definitely has a track record of being one of the best long term real estate investments in the U.S. through the last decade so. Despite recent increases in the Oakland housing market, median home values are considerably less than surrounding areas. Oakland homes are far less expensive than San Francisco homes, which have seen median prices exceed $1,000,000.
California is often touted as one of the best real estate markets for both long-term and short-term real estate investments. The reason being that California has the 6th largest economy in the entire world. This is largely driven by its innovative production, the heavy tech sectors in the state, and more. For investors it is a strategic place to add to their real estate investment portfolio.
The Oakland economy has managed to keep pace with the entire state of California with new construction projects being its primary source of economic growth. Now let’s take a close look at the Oakland real estate market trends and forecasts for 2019 & 2020 find out why it is one of best places in California to invest in real estate.
Oakland Real Estate Market Forecasts 2019, 2020 & 2021
The median home value in Oakland is $734,900 on Zillow. Oakland home values have declined -1.0% over the past year and Zillow’s Oakland real estate market prediction that the prices will will rise 2.5% within the next year. The median list price per square foot in Oakland is $505, which is higher than the San Francisco-Oakland-Hayward Metro average of $491. The median price of homes currently listed in Oakland is $669,000 while the median price of homes that sold is $684,500. The median rent price in Oakland is $2,997, which is lower than the San Francisco-Oakland-Hayward Metro median of $3,300.
According to LittleBigHomes.com, the Oakland real estate market forecast for the 12 months ending with the 3rd Quarter of 2019 is positive. Their accuracy of the Oakland real estate market trend prediction is 85%. Accordingly, they estimate that the probability for rising home prices in Oakland is 85% during this period. If this Housing Market Forecast is correct, home prices will be higher in the 3rd Quarter of 2019 than they were in the 3rd Quarter of 2018.
Oakland Housing Market Forecast 2019 – 2021
The Oakland housing market forecast for the 3 years ending with the 3rd Quarter of 2021 is also positive. The accuracy of the Oakland housing market trend prediction for Oakland is 78%. Accordingly, LittleBigHomes.com estimates that the probability for rising home prices in Oakland is 78% during this period. If this Housing Market Forecast is correct, home values will be higher in the 3rd Quarter of 2021 than they were in the 3rd Quarter of 2018.
Check this page each quarter for updates to the Oakland Real Estate Market Forecast.
Oakland Real Estate Market Trends
Oakland real estate market trends indicate a decrease of $12,500 (-2%) in median home sales and a -5% drop in median rent per month over the past year. The average price per square foot for this same period rose to $575, up from $543. Trulia has 765 resale and new homes for sale in Oakland, CA, including open houses, and homes in the pre-foreclosure, auction, or bank-owned stages of the foreclosure process.
The median sales price for homes in Oakland for Jan 11 to Apr 10 was $654,500 based on 470 home sales. Average price per square foot for Oakland was $575, an increase of 6% compared to the same period last year. The median rent per month for apartments in Oakland for Mar 10 to Apr 10 was $3,000.
As per the real estate company named Redfin, the Oakland housing market is most competitive. Homes in Oakland receive 3 offers on average and sell in around 16 days. The average sale price of a home in Oakland was $758K last month, up 9.9% since last year. The average sale price per square foot in Oakland is $545, up 9.7% since last year. Homes typically receive 3 offers. Homes in the Oakland housing market sell for about 8% above list price and go pending in around 16 days. Hot Homes for sale in Oakland, CA can sell for about 18% above list price and go pending in around 12 days.
Oakland Housing Market Statistics
There are 958 homes for sale in Oakland, CA, ranging from $10K to $4.2M on Realtor.com. 99 of which were newly listed within the last week. Additionally, there are 334 Oakland rental properties, with a range of – to $15K per month. In February 2019 the housing market in Oakland, CA was a seller’s market, which means there were roughly more buyers than there were active homes for sale. Seller’s markets are generally more advantageous for sellers rather than buyers.
In February 2019, the median list price of homes in Oakland, CA was $649K, trending up 3.8% year-over-year. The median listing price per square foot was $479. The median sale price was $712.5K. Homes in Oakland, CA sold for 4.83% above asking price on average in February 2019. Homes in Oakland sell faster than average compared to other cities in Alameda County. It takes an average of 37 days on market for a home to sell in Oakland. On average, homes in this cities sell for 4.8% above asking price.
The median list price in Oakland, CA is $675,000 on Movoto.com. The median list price in Oakland went down 1% from March to April. Oakland’s home resale inventories is 303, which decreased 2 percent since March 2019. The median list price per square foot in Oakland is $511. March 2019 was $508. Distressed properties such as foreclosures and short sales remained the same as a percentage of the total market in April.
Oakland Single Family And Multi-Family Homes
As per the data from the real estate company called Neigborhoodscout.com, the median house price in Oakland is $664,186, which is quite above the national average but still don’t compare to real estate prices in the most expensive California communities. Single family detached homes are the single most common housing type in Oakland, accounting for 42.65% of the city’s housing units.
Other types of housing that are prevalent in Oakland include large apartment complexes or high rise apartments ( 33.89%), duplexes, homes converted to apartments or other small apartment buildings ( 18.21%), and a few row houses and other attached homes ( 4.78%).
People in Oakland primarily live in small (one, two or no bedroom) single-family detached homes. Oakland has a mixture of owner-occupied and renter-occupied housing. Currently, there are 492 single family homes for sale in Oakland, CA on Zillow. These include upcoming potential listings. Additionally, there are 121 single family homes for rent in Oakland, CA.
Oakland, CA Foreclosures And Bank Owned Homes
According to Zillow, foreclosures will be a factor impacting home values in the next several years in Oakland, CA. In Oakland 0.1 homes are foreclosed (per 10,000). This is the same as the San Francisco-Oakland-Hayward Metro value of 0.1 and also lower than the national value of 1.2.
The percent of delinquent mortgages in Oakland is 0.5%, which is lower than the national value of 1.1%. With U.S. home values having fallen by more than 20% nationally from their peak in 2007 until their trough in late 2011, many homeowners are now underwater on their mortgages, meaning they owe more than their home is worth. The percent of Oakland homeowners underwater on their mortgage is 3.2%, which is higher than San Francisco-Oakland-Hayward Metro at 2.7%.
There are currently 329 properties in Oakland, CA that are in some stage of foreclosure (default, auction or bank owned) while the number of homes listed for sale on RealtyTrac is 206. In March 2019, the number of properties that received a foreclosure filing in Oakland, CA was 6% lower than the previous month and 28% lower than the same time last year.
Home sales for February 2019 were up 0% compared with the previous month, and down 100% compared with a year ago. The median sales price of a non-distressed home in Oakland, CA was $0. The median sales price of a foreclosure home in Oakland, CA was $0, or 0% higher than non-distressed home sales.
Oakland Home Prices And Real Estate Appreciation
Oakland real estate appreciated 95.50% over the last ten years, which is an average annual home appreciation rate of 6.93%, putting Oakland in the top 10% nationally for real estate appreciation.
Oakland real estate appreciation rates are so strong that despite a nationwide downturn in the housing market, Oakland real estate has continued to appreciate in value faster than most communities. Looking at just the latest twelve months, Oakland real estate appreciation rates continue to be some of the highest in the U.S., at 13.02%, which is higher than real estate appreciation rates in 98.94% of the cities and towns in the nation.
Based on the last twelve months, short-term real estate investors have found good fortune in Oakland. Oakland real estate appreciation rates in the latest quarter were at 2.20%, which equates to an annual appreciation rate of 9.08%.
The above statistics on real estate appreciation in Oakland were taken from NeighborhoodScout.com. You can visit their page for more information. Relative to California, their data shows that Oakland’s latest annual appreciation rate is higher than 80% of the other cities and towns in California.
10 Best Neighborhoods In Oakland For Real Estate Investment
There are 268 schools in Oakland, CA. There are 89 elementary schools, 60 middle schools, 45 high schools and 74 private & charter schools. There are 117 neighborhoods in Oakland. Piedmont has a median listing price of $2.3M, making it the most expensive neighborhood. Arroyo Viejo is the most affordable neighborhood in Oakland, with a median listing price of $405,000.
These are the 10 best neighborhoods in Oakland to invest in real estate because they have the highest real estate appreciation rates (List by Neigborhoodscout.com).
Should You Invest In The Oakland Real Estate In 2019?
Investing in real estate is touted as a great way to become wealthy. Is Oakland rental property good for investment? If you are looking to buy Oakland investment properties, then you must read this. These things make Oakland real estate market stand out when it comes to choosing a place to invest in 2019 and beyond. We have already discussed the Oakland housing market forecast for answers on why to put resources into this sizzling market in 2019.
The home prices in the Oakland housing market will be on an upswing all through 2019. The Oakland home prices are expected to rise by 2.5% in 2020. So you should consider investing in Oakland rental properties sooner, to avoid higher home prices down the road.
Here are the top 10 reasons to invest in the Oakland real estate in 2019.
1. Oakland Has Become Silicon Valley’s Housing Solution
Silicon Valley has become a hotbed for real estate. People who can’t afford a million dollar starter home on $150,000 a year don’t want to cram into a one bedroom condo. The solution is to drive to the East Bay and buy a house in Oakland instead. This solution is amplified by the startups and tech firms expanding into the cities around San Francisco, driving demand for homes in those neighborhoods while allowing people in the Oakland housing market to be in reasonable commuting distance of high paying, high tech jobs. This is creating strong demand for Oakland rental houses that isn’t going to let up any time soon.
2. Oakland Is Seeing Heavy Appreciation
The Oakland real estate market was depressed for years because of the high crime and mediocre infrastructure. For example, there was little interest in Oakland rental houses when the public thought moving there would guarantee you got shot. However, the city has been on a rebound, and it is due to San Francisco’s insane tech bubble.
The gentrification of Fruitvale and Millsmont is causing prices to rise in those neighborhoods. The renaissance in these areas is aided by improved public transit to jobs in high tech corridors and new construction that provides money for needed services.
As tech workers and middle class professionals priced out of San Francisco move in, properties that sold for half a million dollars or less are starting to approach the million dollar mark. That’s at the high end of the Oakland housing market. The median price for homes was around $400,000 in Richmond, but it hit $550,000 in 2018. Buy Oakland rental houses now before they hit $750,000.
3. Demand Is High
The Bushrod neighborhood in Oakland made Redfin’s list of hottest neighborhoods because it was one of the few areas you could buy single family homes right across from San Francisco and near the water for less than a million dollars. Bushrod was considered the hottest Oakland real estate market because properties were selling in less than two weeks for 15% above the listing price on average. When homes sell this fast, you know demand for Oakland rental properties will be equally high. Expect rents in the area to increase at double digit rates along with the housing prices.
4. Supply Is Unusually High, Too
Oakland has long been a working class community. Crime is down, and improved public transit makes it a half hour to hour long commute to San Francisco depending on where you are in the Oakland real estate market. What is noteworthy is how many people are selling 500 to 1500 square foot homes they’ve owned for decades to cash out and move somewhere else. This means there is a greater supply of potential Oakland rental properties on the market than other cities, since there is heavy churn. Resale inventory was up roughly 8% since last year.
5. Space Is Limited
The Oakland housing market shares many of the constraints San Francisco does. You can’t build on the ocean, which lays to the west. There are already cities to the north, south and east. The Oakland real estate market has long been described as old and low, since it wasn’t considered worthwhile to build condo towers here. The only way they can meet demand is by building taller or raising real estate prices to constrict demand.
The influence of San Francisco not only increases demand for housing and housing prices in Oakland. It also contributes to the resistance to building any tall new buildings, too. You can convert warehouses to apartments and lofts, but don’t expect a spate of 500 foot condo buildings to reduce demand for Oakland rental properties. We can see this in the 300 foot tower bitterly fought by neighbors.
6. The Diversity of Real Estate Has Its Benefits
One point in favor of the Oakland real estate market is the diversity of properties you can invest in. You can find 1950s mid-American bungalows available for purchase as Oakland rental properties. You can choose little Spanish style houses. There are warehouses and former businesses available for redevelopment as multifamily housing. There are modern upper class homes built on what was once a 40 by 30 lot.
7. The Customer Base Is Diverse, Too
Another form of diversity in the Oakland real estate market is the fact that it is still mixed-class. You can find new construction catering to wealthy San Francisco tech refugees. And you find local working class families fighting to find apartments and houses they can afford. This creates incredible demand for any affordable Oakland rental properties, but it means there is a strong demand for luxury Oakland rental units, as well.
8. Return on Investment Is Very High
The Oakland real estate market is second only to San Francisco in terms of rental rates. It is rivaling New York City, Boston and San Francisco in terms of rental prices. One bedroom apartments are averaging $2400 a month. Yet Oakland housing units remain two hundred to five hundred thousand dollars cheaper than San Francisco properties. This means you’ll see far better ROI on Oakland rental properties than San Francisco properties.
9. It Is a Little More Friendly to Landlords than San Francisco
We’re talking about the San Francisco area, so the entire area is tenant friendly, not landlord friendly. However, the degree of “unfriendliness” to landlords and property owners varies from city to city. On one hand, Oakland passed a vacant property tax. You can be sure people will build something on the only empty lots that remain and stick someone in just to get that tax off their property bill. This may result in a spurt of new construction or empty units coming onto the Oakland real estate market, though the new buyer better fill the units soon.
On the flipside, the cheaper Oakland housing market means you pay less in property taxes than you would in San Francisco. Oakland and Berkley both have a real estate transfer tax, but the cheaper housing here means you pay less for the real estate transaction than you would in Berkley. It is about as difficult to evict someone in Oakland as in San Francisco, but it is much easier to evict someone in Oakland if you live in the duplex and triplex.
10. Oakland Allows AirBnB Type Rentals within Limits
Forget the cities that outright ban AirBnB and other short term rentals. Oakland recognizes that such rentals help some people pay their rent, and they realize that short term rentals can make units available to those between permanent housing or new to the area.
Oakland has detailed rules regarding short term rentals. If you rent out the property on a short-term basis, the property has to be registered and you’ll be required to pay the transient occupancy tax. Landlords catering to the short term market have to get a business tax certificate and business permit.
The zoning rules may limit which housing units can be converted to short term rentals or where you can rent out units for this type of customer. However, it is legal if you follow the rules and you can see significant returns when you do. As an added bonus, you can receive money simply for renting out a garage or office as work space.
Oakland Real Estate Investment
Maybe you have done a bit of real estate investing in Oakland, CA but want to take things further and make it into more than a hobby on the side. It’s only wise to think about how you can and should be investing your money. If you invest wisely, you could secure your future. If you are a beginner in the business of cash flow real estate investing, it very important to read good books on real estate.
Most investors naturally gravitate to residential property investment. When looking for the best real estate investments, you should focus on markets with relatively high population and employment growth. Both of them translate into high demand for housing. If housing supply meets housing demand, real estate investors should not miss the opportunity since entry prices of homes remain affordable.
You must also collaborate and learn from savvy real estate investors who have retired early on in their lives by investing in some of the best real estate markets like Oakland, CA. The Oakland real estate market is a cheaper version of the San Francisco real estate market with similar rental rates and a slightly friendly legal climate. It presents a good opportunity for real estate investors.
Buying an investment property is different from buying an owner-occupied home. Investment properties are designed to make money as rentals, which means you must look at it solely as an income producing entity just like any other business.
Whether you are a beginner or a seasoned pro you probably realize the most important factor that will determine your success as a Real Estate Investor is your ability to find great real estate investments.
According to real estate experts, buying in a market with increasing prices, low interest, and low availability requires a different approach than buying in a cooler market.
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Other Best Places To Buy Rental Property In California In 2019
California’s real estate market is the focus of many US and foreign property investors. But what are the best places to buy rental property in California?
1. San Jose Real Estate Market in California
Apart from the Los Angeles real estate market, you can also invest in another hot market in San Jose. San Jose is part of Silicon Valley, a place where $100,000 a year or higher salaries from competing tech firms has driven up the cost of real estate. But what about the San Jose housing market itself? San Jose is the third largest city in California, home to roughly a million people. It has the highest cost of living of any area in the U.S., and it is one of the most expensive housing markets in the country.
If you want to invest in the San Jose rental properties, you may not need to buy and renovate. Instead, if you know of industrial or commercial properties near major employers they may need to convert to employee housing, you could buy now and hold until it sells. If that doesn’t happen, you could still turn it into co-working space.
In January, 2018, Redfin ranked the ten hottest neighborhoods in the United States. Nine of the ten were in San Jose. When single home prices fall from 1.2 million to 1 million, homes now sit on the market for several days instead of being snapped up immediately. The median price for a new home or condo was $750,000 in 2018, down from a record of nearly $800,000 a few months prior. If you want to invest in the San Jose housing market, you should do it now while things are – relatively speaking – affordable.
2. San Diego Real Estate Market in California
The San Diego real estate market offers an ideal mix of limited supply, high demand and excellent income potential. If you’re going to invest in California, it needs to be in San Diego. The San Diego real estate market has been ranked among the ten most expensive real estate markets in the country, though it ranks below several other West Coast cities.
This creates massive demand for San Diego rental properties by those who simply cannot afford to buy homes. The rental market will continue to grow as the city grows an estimated 500,000 by 2050, adding tens of thousands each year.
San Diego also has many tourist attractions. Balboa Park is home to the San Diego Zoo, the Air and Space Museum, the Natural History Museum, the Desert Garden, the local youth Symphony, a Japanese garden and a golf complex. There’s a SeaWorld in San Diego, an MLB stadium, the USS Midway Museum and the San Diego Zoo safari park.
On top of this is the mild weather and proximity to the beach. Any San Diego rental properties in easy reach of these attractions command a premium on rental sites like AirBnB. Demand for rentals in the San Diego real estate market soars during Comic-Con, one of the biggest comic conventions in the country.
3. Los Angeles Real Estate Market in California
The numbers may not make sense for many investors but if you ask savvy investors based in LA they would like to bet anytime on this expensive real estate market. The Los Angeles real estate market has many points in its favor beyond its sheer size. The strong market fundamentals make the Los Angeles housing market a good place to invest if you’re looking at buying real estate in California.
Los Angeles has an unemployment rate of around 4%. What makes Los Angeles unique is the employment market. Want to work in Hollywood? Move to L.A. Want to work for a production company or in fashion? Come to L.A. If rent is too high, share an apartment or single family home with friends.
The Los Angeles housing market has seen a bump in residential construction. This has helped to satisfy some demand from renters. However, due to increasing demand, the new supply hasn’t brought prices down. It simply means that the vacancy rate in Los Angeles remains around 3% instead of falling any lower. This also suggests that any new wave of construction will at most result in rental rates remaining steady instead of causing them to fall.
Let us know which real estate markets you consider best for real estate investing! If you need an expert investment advise, you may fill up the form given here.
One of our investment specialists will get in touch with you to discuss all facets of searching for, buying, and owning a turnkey investment property.
*Remember, caveat emptor still applies when buying a property anywhere. The information contained in this article was pulled from third party sites mentioned under references. Although the information is believed to be reliable, Norada Real Estate Investments makes no representations, warranties, or guarantees, either express or implied, as to whether the information presented is accurate, reliable, or current. All information presented should be independently verified through the references given below. As a general policy, the Norada Real Estate Investments makes no claims or assertions about the future housing market conditions across the US.
Eastbay / Silicon Exodus https://www.berkeleyside.com/2018/04/13/faced-with-steep-prices-buyers-look-to-emerging-east-bay-neighborhoods
Supply is high
Space is limited
Diversity of real estate
More friendly for landlords
Market Data, Trends and Statistics https://www.zillow.com/Oakland-ca/home-values https://www.littlebighomes.com/real-estate-oakland.html https://www.trulia.com/real_estate/Oakland-California https://www.redfin.com/city/13654/CA/Oakland/housing-market https://www.realtor.com/realestateandhomes-search/Oakland_CA/overview https://www.movoto.com/oakland-ca/market-trends https://www.neighborhoodscout.com/ca/oakland/real-estate https://www.realtytrac.com/statsandtrends/ca/alameda-county/oakland https://www.fortunebuilders.com/oakland-real-estate-and-market-trends
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