With mortgage rates ticking down this year, the housing market in parts of the Bay Area has started to heat up again, and ZIP codes in the East Bay and Silicon Valley are showing some of the biggest rises in home values.
Home values have risen most rapidly in Fremont, whose quality schools, suburban feel and driving-distance proximity to tech hubs have put its properties in high demand in recent years. Its 94538 ZIP code, which includes the city’s Central District, saw estimated home values jump from less than $1.3 million in January to nearly $1.4 million in August, according to data from real estate brokerage Zillow.
That 9% increase was the largest among the 200 most-populous Bay Area ZIP codes in Zillow’s data, followed by three other Fremont ZIP codes — ranging in typical value from $1.5 million to $2.2 million — and the single-ZIP city of Newark, Fremont’s neighbor.
It’s not just Fremont’s ZIP codes seeing home values rise. The 95051 ZIP code in Santa Clara, which includes the headquarters of tech giant NVIDIA and the city’s Koreatown, saw typical home values rise by more than $100,000 this year, or 7%.
The for-sale housing market has grown especially competitive in the Bay Area’s suburban cities and neighborhoods since the beginning of the pandemic, when remote work policies fueled a desire for larger living spaces within commuting distance of job centers. Interest rate hikes in 2022 cooled the market through much of last year, but some real estate agents say recent rate cuts have renewed demand.
Fremont’s home values, which have been on the rise since mid-2023, have climbed so far that the city set a record in July for its highest-ever typical value, at $1.55 million, according to Zillow data, with the estimate climbing slightly higher in August. Its previous record had been set at $1.53 million in June 2022, before record-low mortgage rates suddenly surged, though that estimate isn’t adjusted for inflation.
Not every Bay Area ZIP code — or city — has seen values increase, however. Oakland’s typical home value continued its slow decline this year, from $772,000 in January to $762,000 in August.
Oakland’s 94612 ZIP code, which includes its downtown, Uptown and Lakeside neighborhoods, has seen the steepest decrease in home values of any of the 200 largest Bay Area ZIP codes, dropping 3.3% from $618,000 in January to $597,000 in August. It was followed by several other Oakland neighborhoods, including West Oakland’s 94607 ZIP code.
Zillow estimated that San Francisco’s 94108 ZIP code, which includes parts of Chinatown and Nob Hill, had the third-largest drop in home values, at 2.2% from $893,000 to $874,000. Piedmont, a wealthy enclave completely surrounded by Oakland, also saw values decline by 1.4%, from $1.45 million to $1.43 million.
San Francisco and Oakland home values have been declining for years, a trend largely driven by the pandemic-related push toward buying homes outside urban cores — sometimes called “the donut effect.” Real estate agents have cited the cities’ sometimes-unearned reputations for crime as a factor. California’s insurance crisis has also affected the East Bay hills particularly hard, drastically raising fire insurance costs for many homeowners.
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Morgan Cook