Did Remote Work Shift Condo Prices?

Let’s dig into Los Altos Real Estate.

For many people, a condo is the first step into home ownership. Since it is their first step, it is likely they are planning on moving to a more appropriate or desirable home in the future. Suppose something happens that upsets a long-existing desirability ratio of various locations. Isn’t it likely that a condo owner would be more likely to move than a house owner?

The COVID-19 pandemic at least temporarily changed how desirable it was to have a restaurant near you. The pandemic also opened remote work options for many people. Living close to work no longer saved as much time commuting to work, because many people no longer had to commute every day that they worked.

Los Altos House Prices vs. Condo Prices

In 2020 as the COVID-19 pandemic restrictions and opportunities grew, Los Altos condo prices trended down while house prices trended up. With no dramatic new construction, changes in preferences must have occurred.

Newark House Price vs. Condo Price

Maybe nearby East Bay City real estate trends can provide some insight.

Both house prices and condo prices grew in many East Bay cities including: Fremont, Newark and Union City. With remote work reducing the cost of commuting, a SF Peninsula condo owner might see either an East Bay house or even a larger condo in the East Bay as suddenly more desirable than his current condo. An SF Peninsula house owner would not see a significant housing upgrade by moving to a house in the East Bay and may even face a property tax and mortgage penalty by selling and buying.

South Bay House Price vs. Condo Price

If the change is due primarily to reduced commuting costs, then other cities that are priced similar to SF Peninsula cities should show similar price trends.

Both condo and house prices are increasing in Saratoga, adding weight that remote work could be affecting prices. Campbell, and Los Gatos show similar trends, while Cupertino has something else going on.