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Bay Area Housing Costs Drive Residents to the Central Valley

Posted by Admin on February 20, 2019
| Buying Properties, Investment, Location, Price, Property, Property Investment, Real Estate, San Jose News
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Bay Area residents who are seeking more affordable places to live are expanding what it means to live in the Bay Area, says a recent story in the Mercury News. Today, towns like Stockton, Lathrop, Tracy, and Merced are absorbing an exodus of Bay Area residents, which is changing the fabric of California’s Central Valley.

Some of the positives from this expansion are that new services and businesses are coming to this traditionally agricultural area. But the negatives include super long commutes and more traffic congestion, as new Central Valley residents still need to get to their jobs in the Bay Area.

New developments, such as one by the  Cambay Group, will add thousands of new homes to the Central Valley. Over the next 20 years, the number of residences in the town of Lathrop, which is about 74 miles east of San Francisco, will double with the addition of 11,000 new homes.

In 2017, over 86,000 workers travelled at least 60 miles, and often as much as 120 miles, one way from the northern Central Valley, which includes the counties of San Joaquin, Merced, and Stanislaus, to reach jobs in the Bay Area. This represents a 43 percent increase since 2010.

The Rise of Megaregions

The Regional Plan Association, a national urban research and advocacy organization, has identified 11 “megaregions” that are emerging across the country, including the expanding Bay Area. Megaregions are large geographic areas that have a constant flow of people, goods, and information, which begin to behave as one coordinated economy.

Examples of U.S. megaregions include the Pacific Northwest region of Seattle, Portland, and Vancouver; the Arizona “Sun Corridor” of Phoenix and Tucson; and the Southern California conglomeration of Los Angeles, San Diego, Anaheim, Long Beach, and Las Vegas. The Bay Area is now being added to this list.

“The Bay Area was already becoming more of a multi-centered region with the growth of Oakland and San Jose,” said Christopher Jones, a senior vice president and regional planner at the Regional Plan Association. “And if you look at the connection with Sacramento, you really start to see that the traditional Bay Area was not really capturing everything that was going on, which was happening with housing markets and business institutions in the area.”

The outlying question is whether these megaregions will bring a balance of jobs that are close enough to where people live to spare them of time-wasting commutes and being stuck in gridlock traffic.

The Valley Link Rail Could Provide Relief

In the northern Central Valley, local leaders hope a train network called the Valley Link will provide relief to Interstate 580 commuters. The proposed 47-mile train route would run from BART’s Dublin/Pleasanton station all the way to Stockton. The plan is for the Valley Link to start carrying passengers by 2026.

The new rail will make it easier for Bay Area residents to make the opposite commute to jobs in the Central Valley as well. Large employers, such as Fisher Scientific, Tesla, Amazon, and Medline, have been establishing a presence in Tracy and in nearby cities. While their warehouses in the region are more focused on manufacturing than higher-paying office jobs, managers still need to get to meetings in the Central Valley. And experts says it’s only a matter of time until those employees move over the hill.

Expansion Brings New Services to the Central Valley

The Central Valley could see growth that’s similar to the way Pleasanton, Dublin, and Livermore changed from open ranches to large-scale suburbs, or even parts of Silicon Valley changed from vineyards to tech centers. This evolution brought restaurants and retail centers, plus the booming tech industry.

Evidence of this is already happening in Tracy, where there’s been an emergence of nightlife and the reopening of the Grand Theater for the Arts, which serves as an interdisciplinary arts center. In response to the growth, the city of Tracy is also undergoing a revitalization, installing new lighting downtown and supporting community festivals.

The town of Stockton is seeing more action as well. Once considered a sleepy agricultural town, there is now new investment in the town, with restaurants, cafés, and breweries opening up to serve the growing population.

Work with the Local Experts and Get the Most from Your Real Estate Investment

At Intempus Property Management, our goal is to help our clients maximize the value of their real estate investments. We’ve been serving satisfied property owners in the San Jose and San Francisco metro areas for well over a decade. We offer a full suite of real estate and property management services to our clients, which is paired with our unparalleled level of service. Contact us today to talk to one of our friendly experts about your real estate or property management needs. We look forward to serving you!

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