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Eureka, California: An oasis for climate (and equity) refugees

The city’s median list price has jump 19.1% year-over-year

In Boise, Idaho, home prices are through the roof. The locals blame California exiles. Even in Vermont, real estate agents say climate refugees from the Golden State are scooping up old farmhouses from the Northeast Kingdom down to Bennington.

But the Californians who wish to remain in-state are descending on Eureka, the rare California town with relatively modest home prices, making it a haven for those who cash in on the equity gained through their previous abode.

Set on the Pacific Ocean with the Coastal Ranges and Redwood Forest to the east in Humboldt County, Eureka is California’s hidden gem, however, more and more people have begun to discover the city’s charm, agents said.

“It is very active and it is very competitive,” local California Real Estate agent Tom Hunt said. “It seems like buyers are so hungry to get something that they’re just bringing their best offer early and then they are willing to compete by either getting rid of their contingencies or just trying to bring more cash.”

In October, Realtor.Com ranked Eureka third on its list of hottest markets in the country. The median list price of a home in Eureka was $399,000, a 19.1% increase from a year ago, according to Realtor.com, however this is drastically lower than the median list price for the state of nearly $800,000. This dramatic jump in price in Eureka, however, has two main catalysts.

“We have a housing shortage right now,” Marci Pigg, a local Coldwell Banker Cutten Realty agent said. “In the past, on average, we would have 380 to 450 homes on the market at any given time and at the current moment, we have 117 residential homes on the market. Plus, demand is super high. We have people moving here from all over.”

Such a high level of demand has resulted in the median number of days a home is sitting on the market dipping to just 10 days, which, according to local Ming Tree, Realtors agent Annalise von Borstel, is probably artificially increased.

“What sellers are doing is they’re listing their home and then saying, ‘We aren’t going to look at offers until this date,’” von Borstel said. “They are anticipating multiple offers. They want a bidding war. But it they were to just put the house on the market, they could easily be under contract potentially that same day or the next day at the latest.”

Von Borstel also said that it was nearly unheard of for a home to not have multiple offers.

“It is literally every house,” she said. “The number of offers just depends on the pricing strategy. If it is priced lower, you know there is going to be 14 to 15 offers. If is it priced higher, there may be only two or three to compete against, but I would say 99% are multiple offer situations.”

With the announcement of plans earlier this summer for local Humboldt State University to become California’s third polytechnic institution, it is clear that demand for housing in the area is only going to increase.

“I wish I could say that we are about to get a ton of new housing, but there is nothing on the immediate horizon that is going to change out inventory situation,” von Borstel said. “Topographically and geographically we are a very challenging place to build. We have a lot of watersheds, a lot of sloping and earth dynamics. We have coastal zones. There are a couple of project on the horizon, but they haven’t broken ground yet. HSU is definitely going to be investing in housing in order to deal with the influx of people coming to the university, but again that is going to be a couple of years down the line.”

Hunt expressed similar sentiments, but also noted that he is still seeing new homes coming on the market every week.

“Last Thursday, 14 houses hit the market, but there are just so many buyers out there, especially with the current interest rates, that they just aren’t staying,” Hunt explained.

Aside from relatively low housing costs as compared to other parts of California, the area’s relative safety from wildfires is also attracting buyers to the area (though Eureka residents. dohave to worry about wildfires).

“We are seeing a lot of people from the fires that have been displaced and are needing and wanting to move up to a more comfortable climate,” local eXp Realty agent Tracie Creps said. “It is definitely one of the things attracting people, if people want to stay in California, but have a lower fire risk.”

This influx of buyers from the southern part of the state has also helped home prices in Eureka reach new heights.

“Within the state a lot of people are moving here either for retirement or because they can work remotely, from more expensive areas, usually it’s the Bay Area, and they end up selling their million-dollar condo and move up here and purchase an acreage ranch for $500,000,” von Borstel said. “We call those buyers the equity refugees.”  

Although home prices are continuing to rise to unprecedented levels, local agents are not sure the end is in sight.

“I got an offer accepted earlier this week and it feel like winning an Ironman because it is so competitive,” Pigg said. “I would hope that it’ll level out, just so our local folks don’t get squeezed out of the market, but I think it will continue going up. But with the lack of local jobs and just with our local economy here, I don’t see things continuing at this pace.”