Palo Alto — one of the most expensive and supply-constrained housing markets in the country — may be about to change dramatically.
As Rob Luecke Jr wrote on r/bayarea: "Six major housing projects are moving through the city, driven by state housing laws, rezoning and public-private agreements."
The Projects
The largest proposals include 386 homes at the former Fish Market site and 390 homes at Mollie Stone's, in 12- and 14-story buildings. For a city known for low-rise neighborhoods, this is unprecedented.
California's state housing laws have made it harder for cities to reject projects that comply with local zoning or state requirements. SB 79 could push the limits even further, potentially allowing buildings to go even higher than the 55-foot rezoning currently proposed.
The debate has moved beyond whether Palo Alto needs more housing. The question now is where it will go, how tall it will be, and how much it will change the city's established neighborhoods and commercial corridors.
What This Means for Palo Alto Homeowners
For current homeowners near these development sites, the impact is real — construction activity, density changes, and potential effects on property values. Whether you see new development as an amenity or a concern, understanding your position early gives you leverage.
For buyers, hundreds of new homes coming to market in a city where supply has been artificially constrained for decades could eventually shift the supply-demand balance. But don't hold your breath — these projects are years from completion.
In the meantime, the median Palo Alto home still sits around $3.5M. At that price, a traditional buyer agent commission of 2.5% is $87,500. With ShopProp, you pay a flat fee of $7,995 and get up to $79,505 back at closing.
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Source: Ground News. As featured in NPR, USA Today, New York Post, and Brookings Institution.