A recent article in The San Francisco Chronicle highlighted a growing problem in the Bay Area: homeowners of prime real estate are not selling because of the capital gains tax.
According to Zillow 12 percent of homes in San Francisco, San Mateo, Alameda, Contra Costa, Marin and Santa Clara counties have gains over $1 million and 5 percent exceed $1.5 million. Moreover, the communities of Atherton, Palo Alto, Stanford, Portola Valley, Los Altos and Los Altos Hills all had 50 percent of homes with gains over $1.5 million.
Analysts agree that this may be freezing up inventory as well as the fact that selling and then buying in this market doesn’t appeal to many.
And, of course, the low inventory of available homes continues to drive up real estate prices.