SF Real Estate Summer Stats Are In!

The San Francisco real estate market didn’t seem to slow down this summer. I was “on vacation” last week, but still reported for duty to prep my upcoming listing, manage my current seller escrow and write offers. Many of my colleagues continued to bring on new listings straight through to the end of August, despite the threat of Burning Man and Labor Day weekend thinning the buyer pool.

And in fact, the last week of August saw many listings coming up dry when offer dates arrived. But I don’t think that this was because the market is softening significantly.

How did buyers and sellers fare in July and August—and what’s on tap for the Fall? I think it’s useful to take a brief look at the single-family home and condo markets individually, as they’re two different animals that need separate analysis:

Summer & Single-Family Homes
The Upshot
The selling pattern for houses continues to see buyers paying more than the list price. Of the 400 houses sold, only 12% closed for under asking, and a meager 4% changed hands for the actual list price. (And when I say that buyers paid less than asking, the differential was only in the 3-7% range under list.)

The average house price was $1.4M, up 9% over July-August 2013. But sales volume decreased by 22%, meaning less buyers weren’t willing or able to pay market value for San Francisco houses this summer.

Overbidding
The average overbid for a house citywide was 10%. But the SF Overbidders Club welcomed 70 new members who paid 25% or more for their homes. These massive overbid hot spots were centered around Bernal Heights, Glen Park and, for some reason, Lake Shore.

Cash Sales
17% of the single-family homes sold in July and August were paid for in cash. The largest cash sale? 2602 Pacific in Pacific Heights, a 6BR/6.5BA property listed for $8,995,000 that closed for $8,250,000.

Luxury Market
A healthy number of houses (67) sold for between $2M-$9.5M.

What’s Up for Houses in the Fall?
Sellers will heed their real estate agents’ advice and continue to list their homes for less than market value to attract as many buyers as possible. Volume will pick up in September through mid November, when a new crop of buyers (and, of course, existing buyers who have been unsuccessful to date) get serious about making a purchase before the end of the year. Sellers will do a double take of the summer stats and take advantage of the market, particularly in the hot spots. (Lake Shore homeowners, get on the ball.) Contractors and developers will be out in full force in popular neighborhoods, picking up fixers to flip.

Summer & Condos
The Upshot
I realize I sound like a broken record, but condo selling patterns also saw homeowners listing their homes for less than what they actually wanted. The condo market was a little more hospitable to buyers than that of the house market. Of the 437 condos sold, only 16% sold for under list price, and 13% traded hands for the asking price.

The average condo price of $1.1M saw an uptick of 13% over last July/August, but similar to that of the house market, there was a 24% decrease in sales volume.

Overbidding
The gap between list and sale price was narrower, with buyers citywide bidding an average of 6.5% over the list price. And the SF Overbidders Club had fewer new condo buyer members. Only 7% of units sold in July and August sold for 25% or more over asking.

Hot spots for overbidders were the usual suspects—Noe/Eureka Valleys, Mission Dolores, NoPa and Hayes Valley.

But the big news was that certain neighborhood markets definitely experienced some softening. Areas like Downtown, Nob/Russian Hills, Civic Center, Mission Bay, SoMa/Yerba Buena, South Beach, Potrero, and Dogpatch all saw their share of less-than-asking prices.

Cash Sales
The condo cash sales didn’t slow down in July and August; 22% of sales were cash transactions. And these popped up most often in north-end enclaves like Pacific Heights, Russian Hill, and the North Waterfront (particularly in larger buildings like 101 Lombard). But Mission Bay and South Beach—most notably, in The Beacon and Arterra—saw a healthy share of cash sales, too. The largest cash sale was $3.5M for a 2BR view unit at the Four Seasons.

Luxury Market
Not too many high-end condos sold in July and August. A total of 8% closed for between $2M-$4.5M.

What’s Up for Condos in the Fall?
A slower market for larger buildings in the aforementioned neighborhoods means buyers may take advantage of stabilizing prices. Who doesn’t want to make an offer for less than asking when you have the chance? I also think buyers will move on from the overbidding hot spots and branch out to other neighborhoods they might not have considered. Sellers of quintessential Victorian/Edwardian flats with all the amenities will do well, as will developers of new construction condos with releases planned in September/October.

Story Behind Prop G, Noe Luxury, Latest Prices

The contentious Prop G will be on our November ballot this year. The proposition calls for a higher transfer tax on people who sell certain residential real estate within five years of purchase. The tax would increase to 24% in those first five years, and then would drop to 14% after five years.

As always, there are multiple sides to the issue, and this edition of the Zephyr Market Tracker looks at some of the different angles.

We also check out some luxurious Noe Valley properties, as well as feature the most recent citywide sales and averages.

It’s all here in the Zephyr Market Tracker.

2BR Condo Market Explodes in Noe Valley

100day
Buyers competing for two-bedroom condos in Noe Valley are apparently willing to pay whatever it takes to snag them a home near a tech shuttle stop and the freeways.

The average price for such a unit in the time period from June through mid August was $1,250,667. Only two of the nine condos sold were under $1M; the rest ranged from $1,250,000-$1,475,000. Average overbid? 27%.

Yes, there are some such condos selling for less, but they generally involve 1,000 square feet or less and don’t include parking—or have other quirks. (For example, a 2BR/2BA condo with parking on Dolores at 29th Street sold recently for $875,000. But the developer owns three of the 13 units, meaning any buyer needing a loan would have to use non-conforming financing.)

A good example of buyers’ insatiable appetite for Noe condos is 100 Day Street at Dolores (above), a 2BR/1.25BA first-floor condo in a four-unit building that’s not considered to be in a prime Noe location. Outdoor space for the building is limited to a small patio. A deeded, finished and unwarranted room down was possibly the factor that pushed this sale over the edge. Listed for $995,000, the unit sold last week for $1,450,000 with no contingencies. (Yes, that’s a whopping 46% over the list price.)

For owners of two-bedroom Noe condos, this market is probably about as good as it’s gonna get. Pricing today should definitely be a motivator for bringing more such homes on the market. But sellers need to heed value limitations; given that 3BR prices are in the $1.5M-$2M range, it’s likely the 2BR condos won’t go significantly higher than their current average.

And buyers, well, your budget should be in the $1,250,000-$1.5M range if you’re aiming to purchase a reasonably spacious two bedroom in Noe with parking.

InsideSFRE Makes the Nightly News

My seller clients and I were interviewed last night on KTVU’s ten o’clock news about the Zillow acquisition of Trulia, and how online real estate sites continue to play an important role in the real estate industry.

I’m a big fan of Trulia, Zillow, and Redfin, and believe they are key in helping buyers and sellers do their research. As I mentioned during the broadcast, most of my clients have done their fair share of online research before I even meet with them for the first time. As a result, they’re up to speed on values and we can get right to in-depth market discussions.

You can watch the broadcast here.

And look for our Bernal Heights listing later this week, especially if you’re in the market for a three-bedroom single-family home in a fantastic neighborhood location.

SF Market Shows Signs of Stabilizing

334winfield
The San Francisco real estate market is actually showing signs of stabilizing. That means we’re starting to see fewer offers on properties, fewer extreme overbidding situations, and buyers having offers accepted that—dare we say it?—have contingencies.

For those of us working in the field, networking with our colleagues and representing buyers and sellers in very recent transactions, it’s pretty obvious that things are calming down a bit. Our sales meetings in the first few months of the year were filled with reports on eight, ten or 15+ offer situations. Now it’s more like three or four. My clients are purchasing a condo in Bernal Heights, and their contract had the full appraisal, loan and inspection contingencies.

A look at single-family home and condo sales through June 25th reveals sales prices of only 7.5% above list price on average for condos, and 12% for houses. Of course, there are the usual hotspots (Mission and NoPa condos, Bernal and Noe Valley houses) where buyers are still recklessly throwing money around (see 334 Winfield, pictured above, listed for $1,295,000 and just closed for $1,765,000 in an all-cash transaction). But in the rest of the city, properties are not selling for way, way over the list price.

But let me be clear: Prices are not declining in San Francisco. Single-family homes sold for an average of $1,648,329 in June, and the average condo price was $1,175,558. If you’ve made a purchase or will do so in 2014, it means you’re at peace with what the market demands right now. And if you’re planning to buy between now and the end of the year, I believe that the summer will be the sweet spot due to less competition among vacationing buyers.

Spotlight on the Mission, Sunday Streets & Latest Sales!

Developers are heading east in the Mission, because let’s face it: There are only so many lots available on Valencia for condo buildings. The latest project to arrive is 1515 at 15th and South Van Ness. The current Zephyr Market Tracker looks at the details. And if new construction isn’t your thing, we profile some current Mission offerings that might interest you.

Plus, the deets on Sunday Streets, and all the latest market stats. It’s all here in the Zephyr Market Tracker!

The Most Competitive House Markets in San Francisco Right Now

If you’re aiming to buy or sell a single-family home in San Francisco, it’s important to take note of the selling patterns in the city’s various neighborhoods. You’ve probably read my blog post from earlier this week on the hottest condo markets, but when it comes to overbidding on houses, the landscape looks slightly different.

The neighborhoods where buyers are overbidding most intensely are varied, and there are many. Here are the most competitive markets according to the average overbid percentage:
Inner Sunset 26.18%
The Mission 22.47%
Glen Park 21.95%
Inner Parkside 21.61%
Miraloma Park 20.48%
Noe Valley 20.14%
Bernal Heights 19.94%
Ingleside Heights 19.51%
Forest Hill 19.45%
Ingleside 18.96%
Crocker Amazon/Outer Mission 18.18%
Eureka Valley 17.77
Sunnyside 17.69%
Central Richmond 16.58%
Outer Richmond 15.38%
Potrero Hill 15.15%

The Runner-Ups
Central Sunset/Parkside 14.93%
Outer Sunset/Outer Parkside 14.80%
Excelsior 14.74%
Portola/Silver Terrace 13.93%
Mission Terrace 12.81%

The Most Competitive Condo Markets in San Francisco Right Now

One of the keys to success in the current San Francisco market is knowing which neighborhoods are the most competitive. Armed with that intel, you can more easily gauge how much to offer on a property, or what list price will work to your advantage.

As many of my regular readers know, I’ve been running a feature highlighting extreme overbidding for several months, regularly inducting new members into the SF Overbidders Club. The reality is that we have many neighborhoods in San Francisco that are showing double-digit overbid percentages, and it’s important to know what the selling patterns are when you’re determining values.

When it comes to the San Francisco market, these patterns can change pretty quickly. My sales data is based on reported MLS sales in the time period April 1 – May 12, 2014, so it’s the most current info available.

Here are the most competitive neighborhoods and their average overbids right now for condo sales:
1. Cow Hollow: 21.87%
2. Cole Valley/Buena Vista Terrace: 21%
3. The Haight: 19.85%
4. Eureka Valley: 18.69%
5. Noe Valley: 16.28%
6. NoPa: 15%
7. Pacific Heights: 13.88%

The Runner Ups
Bernal Heights: 11.37%
Mission/Mission Dolores: 10.49%
Potrero/Dogpatch: 10.49%
Corona Heights: 10.16%
Hayes Valley/Alamo Square: 9.6%
Presidio Heights: 8.52%
Lower Pacific Heights: 8%
The Marina: 7.61%
Mission Bay: 6.32%
SoMa: 6.61%

As for more specifics on how much you should offer or for what price you should list your home—well, that’s my job, and I’m happy to work for you. Give me a shout at 415.823.4656 / ebermingham@zephyrsf.com and we can talk about how I can help you. And yes, I’ll be hitting up the single-family home market later this week so you can see where the hottest markets are right now in the city.

Latest Sales, Value of Staging, Spotlight on Portola

The new Zephyr Market Tracker explores the southeast neighborhood of Portola, checks in on whether staging makes a difference in the current market and gives you the lowdown on the most recent citywide sales.

And of course, you’ll get the market overview for single-family homes, condos and two- to four-unit buildings.

It’s all here in the Zephyr Market Tracker!

Latest SF Sales, Spotlight on SoMa

Who doesn’t love to look at sales reports hot off the presses? This edition of the Zephyr Market Tracker shows you what sold, and for how much above or below the list price.

We also look at what’s for sale in SoMa, and what Project Open Hand recently did for the community.

It’s all here in the Zephyr Market Tracker!

RSVP for Home Buyer Boot Camp!

Get in shape for the Spring real estate market by attending our Home Buyer Boot Camp! Back by popular demand, Boot Camp will whip you through the ins and outs of getting financing, writing a winning offer and completing a smooth transaction. We’ll give you tons of practical, useful information you won’t find anywhere else.

Here are the deets:
Date: Saturday, April 19th
Time: 10:00-noon
Place: 1746 18th Street (betw Arkansas & Carolina in Potrero Hill)
Your Hosts: Yours truly, blogger-Realtor Eileen Bermingham of Zephyr Real Estate, and loan extraordinaire Mike Koran of Primary Residential Mortgage.

We’ll have refreshments and we won’t make you do push-ups. RSVP today to Eileen at ebermingham@zephyrsf.com, or call/text at 415.823.4656. I’ll confirm your reservation. Space fills up quickly, so please RSVP as soon as you can so we can guarantee you a seat.

Where’s 2014 Going in SF Real Estate?

The first quarter of 2014 is history, but the sales stats and other market conditions I’m experiencing give us an idea as to where the market is heading this year.

Let’s take a look at activity for single-family homes and condos first:
Single-Family Home Market
# Sold: 442
Average Price: $1,401,901
Percentage of Cash Sales: 25%
# Homes Sold for $1M or Less: 226
Where to Buy for $1M or Less: Outer Parkside/Sunset; Parkside/Central Sunset; Merced Heights; Ingleside; Midtown Terrace; Miraloma Park; Sunnyside; Bayview; Crocker Amazon; Excelsior; Outer Mission; Visitacion Valley; Portola; Silver Terrace.
Volume Lower, Prices Higher: It was full speed ahead for the single-family home market in the first quarter. Though volume was down slightly from the first quarter of 2013 when 497 houses sold, the average price was up from $1,164,962 (Q1 2013). Of the 109 cash sales, more than half were for homes above $1M, including a $10M home on Green Street in Pacific Heights and a $7M property on Duncan in Noe Valley.

Condo Market
# Sold: 568
Average Price: $1,033,560
Percentage of Cash Sales: 24%
# Homes Sold for $1M or Less: 321
Where to Buy for $1M or Less: Ingleside Heights; Diamond Heights; 1BRs in Eureka Valley and NoPa; Western Addition; Downtown; Van Ness Corridor; Bernal Heights; Mission; Mission Bay; Potrero; SoMa; South Beach; Dogpatch.
Volume Again Lower, Prices Higher: The condo market also didn’t miss a beat where prices were concerned. A total of 546 condos sold for an average of $901,046 in Q1 2013. A year later, the average has broken $1M.

Where Are We Headed in 2014?
I’ve received at least half a dozen calls or emails from clients in the past two weeks asking whether it’s a good time to sell. The concern is that selling now may find them leaving money on the table if prices increase.

I think that if you own a home right now and are in a position to sell it, you should take advantage of this market. For one thing, interest rates are on the rise. And though 25% of buyers are running around with cash, the other 75% of the buyer pool will be sensitive to higher interest rates, and will be watching their offer prices a bit more closely. I also believe that we’re in somewhat of a peak period, and that prices have only so much further to go this year before they flatten. I didn’t feel that way in 2010, 2011, 2012 or 2013. But based on market activity to date, it feels like 2014 will be different.

Another major factor that may keep resale prices even in 2014 is the expected increase in inventory. We’ll see the typical inventory bump in Spring and Fall, as well as many new construction condo projects kicking off sales on many buildings in the city pipline. This means that buyers will have more properties to choose from. And for sellers, that will translate into less offers per property and less intense overbidding.

SF Real Estate Market Strong, Despite Earthquake Risks

I was interviewed for a story that ran yesterday in the British daily The Guardian about the threat of a large earthquake and how that might influence people when they consider purchasing real estate in San Francisco.

Yes, local market is particularly strong right now, and yes, I routinely have conversations with home buyers about the concept of earthquakes and how they can protect their investment. When it comes down to it, it’s important to know what ground you’re on and how solid your foundation and other seismic components are.

The Guardian’s Nate Berg did a great job presenting all angles of this topic. Check it out here:
When, Not If: How Do San Franciscans Live With the Threat of the Next Quake?

And if you’re interested in my take on earthquake insurance, this past blog post discusses that:
Should You Buy Earthquake Insurance?

Spotlight on Mission Dolores Park, SF Conserves Water

The latest Zephyr MarketTracker gives you the scoop on Mission Dolores Park’s renovations, and also takes a look at a couple properties on the market in this very popular neighborhood.

We also congratulate San Franciscans for leading the way where water conservation is concerned!

You’ll also see recent sales and a market overview. It’s all here in the current edition of the Zephyr MarketTracker!

Spring a Good Bet for More Inventory

We’ve been operating at a very low housing inventory to date in 2014. It seems like there are anywhere from five to twenty buyers for every property that comes on the market, creating consistent multiple-offer situations and substantial overbidding.

I do expect this activity to continue throughout the year. Our economy is strong in the city, and there is seemingly no end to the number of buyers who are materializing and willing to pay very high prices for homes. But I believe there are many homeowners who are in the process of either planning a move or seriously considering one. It’s hard to pass up an opportunity to cash out, especially if you own a home in a very “hot” neighborhood.

As a result, we can expect a spike in inventory as soon as April, which will scatter buyers around a bit more. Coupled with new construction condo projects beginning sales in the Spring, the pressure should ease a bit on the resale market.

What’s the takeaway? If you’re a buyer who’s planning to start looking in the Spring, it’s important to get sorted out now with your financing. And if you’re a homeowner, this is the time to start preparing your home with painting, repairs and staging so it stacks up well against the competition.