The Bay Area Rises
Once you work your way to the middle of the Local leaders list—Nos. 21 to 30—there’s often very little year-over-year change. Charleston moved up one spot from No. 31 in 2015 into this section of the list, while Chicago advanced one spot to No. 20
This year’s ranking is no different. Cities may move up or down a spot, but there aren’t many major changes. The one city that did move two spots was San Francisco—possibly the most expensive, supply constrained metro in the entire country.
Not surprisingly, jobs in the City by the Bay are driving closing growth, which increased from 3,483 closings in 2015 to 3,994 in 2016. Over the past five years, employment in the information sector in the San Francisco area has jumped 62% since 2010, according to Forbes.
“It’s almost mind-boggling over in the Bay Area,” says Greg Gross, regional director of Metrostudy’s Nevada markets of Las Vegas and Reno, as well as the Northern and Central California markets. “Total employed is well above the record, job creation remains exceptionally strong, and supply is very, very low.”
But good job growth and low supply present one major challenge—unaffordability. “In most submarkets, the home prices are well above the peaks reached in 2005-2007,” Gross says. “We’re literally in unchartered territory.”
The area is also dependent on international investors, whose interests depend on their local economy. “We have had a lot of foreign investment in housing, specifically from China and Asia in general,” Gross says. “If the China economy slows, I think we will see the Bay Area slow as well.”
30. Charleston/North Charleston, S.C.
29. Baltimore/Columbia/Towson, Md.
28. North Port/Sarasota/Bradenton, Fla.
27. San Francisco/Oakland/Heyward, Calif.
26. Oklahoma City, Okla.
25. Portland/Vancouver/Hillsboro, Ore./Wash.
24. Indianapolis/Carmel/Anderson, Ind.
23. Minneapolis/St. Paul/Bloomington, Minn./Wis.
22. Philadelphia/Camden/Wilmington, Pa./N.J./Del./Md.
21. Jacksonville, Fla.
