Category Archives: Market News

What’s On The Condo Market: February 2016

What’s On The Condo Market: February 2016

There are more than 300 condos on the market right now in San Francisco, so there’s a good chance one will be a fit for you if you’re looking to buy one. Here’s a look at what’s out there in the one-, two- and three-bedroom market segments:

One-Bedroom Condos
Number Available: 85
Median List Price: $849,000
Neighborhoods With the Most 1BRs: South Beach; Lower Pacific Heights; SoMa/Yerba Buena; South Beach; Van Ness/Civic Center
Least Expensive 1BR: 750 Great Highway #2 ($489,000) in the Outer Richmond. Reasonable floor plan, in-unit laundry & dishwasher, and located right across the street from the beach.
Most Expensive 1BR: It’s a tie! 650 Delancey (Oriental Warehouse) #416 and #304 in South Beach, both listed for $1,695,000. #416 is a top floor 1BR that could be used as two bedrooms, shiny red kitchen and parking. #304 has a master bedroom plus office, neutral color scheme, and parking. Both are clocking in at $1,157-$1,213/square foot, which is right in line with market prices.
My Value Pick: 246 2nd Street #905 ($775,000), in Yerba Buena. This unit has a walk-out terrace with city views, in-unit laundry, storage and parking. Continue Reading

Outer Sunset Sees Record $2M Sale, Prices Soar

Outer Sunset Sees Record $2M Sale, Prices Soar

The Outer Sunset had its breakout year in 2016. Once a sleepy oceanside neighborhood with a reliable stock of homes for under a million dollars, the Outer Sunset’s prices are steadily creeping upward. And the area just saw a record-breaking sale for $2M last December.

Prices have been edging up over the past few years. For example, the average price for an Outer Sunset house was $863,169 in 2014, and that number climbed to $1,029,921 in 2015, with five homes changing hands for $1.3M+. Continue Reading

What You Should Know About the SF Fixer Market

What You Should Know About the SF Fixer Market

Driven by high buyer demand for single-family homes, the fixer market is going gangbusters in San Francisco.

There are generally two categories of what you’d call “fixers” in San Francisco real estate. The first is the contractor special—not habitable, needs work on the foundation, roof and everything in between. Then there’s the habitable house with a clunky floor plan and expansion potential that could be transformed into someone’s dream house. Continue Reading

Outer Sunset Takes Overbid Title in Q4 2016

The Outer Sunset, Parkside and Outer Parkside led the single-family overbidding pack in the last quarter of 2016, with average overbids that far exceeded other neighborhoods.

Though the average citywide overbid was five percent, the Outer Sunset saw buyers paying an average of 19.5% over the list price, with the Parkside (19%) and Outer Parkside (17.5%) hot on its heels. Other high-flying neighborhoods included Miraloma Park (14%); Portola (13%); Central Sunset (12.5%); Sunnyside (12.5%); and Excelsior (11.5%). Continue Reading

Single-Family Homes: Holy Grail of 2016

Buyers had a seemingly endless appetite for houses when it came to San Francisco real estate in 2016. On the other hand, the condo market flatlined.

The fourth quarter of last year is the best indicator for market activity in early 2017. So here’s how things went down when it came to houses and condos, and what you can expect in the new year:

Single-Family Home Prices Rise, Overbidding Continues
Buyers purchased 590 houses in Q4 2016 for an average of $1,844,851. Many homes listed for $2,000,000 or less garnered multiple offers, particularly those listed for closer to $1,000,000. Continue Reading

Bipolar Buyer Behavior Prevails Through 2016

Two recently closed sales in Eureka Valley and Buena Vista/Ashbury Heights point to the continued bipolar nature of the San Francisco real estate market.

There’s 562 Sanchez, a 4,000 square foot, four-bedroom house a block from Dolores Park. The property came on the market at the end of June for $3,950,000. After withdrawing the listing and then making a few price cuts, the sellers received an offer and the sale closed late last week for $3,500,000—$400,000 under the list price:
562-sanchez Continue Reading

Bark Louder Than Bite in “As Is” Sales

There’s an addendum that frequently makes it into the purchase agreement in many transactions—the “As Is” addendum. I’m often asked by buyers what this actually represents.

The truth is, an “As Is” addendum means virtually nothing. It’s basically a warning from sellers that they aren’t going to be receptive to repairs or credits during escrow. Or, as an attorney during my company’s recent risk management seminar put it: An As Is addendum is when “sellers are putting the flag up and keeping their fingers crossed” that the buyer won’t try to negotiate anything. Continue Reading

Small Bump in House Prices Forecasted for 2017

Small Bump in House Prices Forecasted for 2017

Single-family homes will likely see a three- to five-percent appreciation in 2017, says First Republic Bank’s Senior Managing Director and Portfolio Manager Alan Zafran at yesterday’s annual holiday Realtor luncheon. Trends are pointing to these slight price increases due to supply constraints and the overall desirability of the city. Continue Reading

Gap Narrows Between List and Sale Price in San Francisco

Our shifting market will be seeing a lot less crazy overbidding in 2017 as the gap narrows between list and sale prices.

I’m expecting the list-low, sell-for-more pricing strategy to continue throughout next year. But as our market evens out, it’s likely we’ll see sale prices that are a lot closer to their list prices.

The average overbids in October-November 2016 for houses and condos were 5.5% and 4%, down by half in the same time last year. This pattern will set the pace for 2017 sales, as buyers and sellers reference comps and base values on late 2016 activity.

I’m predicting that a small portion of properties will sell for 25% or more next year—houses in highly desirable neighborhoods, and “classic” condos with period detail in smaller buildings that are near popular retail areas and transportation. But the majority of sellers will be wise to expect values within comp ranges, and set their list prices closer to the likely values.

What The Trump Presidency Will Mean For San Francisco Real Estate

It’s taken me a bit of time to absorb the political events of the past two weeks. It was a challenge to think clearly about the ramifications of a Trump presidency in the first week after the election. But once the shock wore off, I started talking with my colleagues and devouring various trusted financial and real estate news sources for some clues about what we can expect in the San Francisco real estate market over the next four years.

I’ve concluded that the most direct effects a Trump presidency will have on our local market will be related to two things—interest rates and available cash for home purchases.

Interest rates are already higher due to more selling in the U.S. bond market. Rates are at four percent on the 30-year fixed product, up from 3.5%. The lending industry didn’t expect to see four percent interest rates until sometime in 2017. It’s a good time for prospective home buyers to reevaluate what you can afford based on the most current interest rates.

Whether the stock market will generate favorable returns will have everything to do with how much cash is available to home buyers. I’m expecting that the stock market will experience constant ups and downs as the new presidential administration announces its plans and initiatives throughout 2017.

Welcome To The Holiday Home Stretch, 2016

If you’re planning to buy or sell real estate in the near future, it’s important to know that the industry slows down after Thanksgiving. Buyers get distracted with holiday activities, and not too many homeowners relish the idea of open houses after the Christmas tree is up.

The bottom line is that new inventory will substantially decrease after your Thanksgiving dinner leftovers are gone. Continue Reading

Contingencies Creep Back Into Contracts

It was more than three years ago that San Francisco real estate market activity prompted me to write about what buyers need to know when waiving contingencies in a purchase contract. We’d finally dug our way out of the financial meltdown, and buyer competition for properties was on the rise.

Besides paying high prices to “win” properties, buyers were waiving appraisal, loan and inspection contingencies to make their offers more attractive to sellers. That meant that buyers were prepared to risk their deposit (3% of the purchase price) if they couldn’t get their loan or couldn’t cover an appraised value shortfall. And they worked around having inspections during escrow, either by relying on seller reports, having pre-inspections or having none at all. Continue Reading

First-Time and Luxury Home Buyers Embrace “Permanent” TICs

Once seen as a stepping stone to condo ownership, tenancy-in-common (TIC) interests have become widely acceptable to San Francisco home buyers as “permanent” TICs. But it’s not just the first-time home buyers who are getting into the TIC game. Luxury buyers are also jumping in.

The fact that condo conversion probably won’t be a future option for TIC owners in buildings with three or more units doesn’t seem to be slowing TIC sales. Continue Reading

Summer Market Wraps Up, Sets Tone for the Fall

It was a summer of withdrawn listings, buyers flocking to single-family homes and rising one-bedroom prices. Though San Francisco real estate was a little slower this summer, there were a number of takeaways that I think will set the tone for the busy Fall season:

Prices remained strong for houses and condos. The average price for a house in the June-August timeframe was $1,695,454, and around $1,200,000 for condos.

Houses were hot. If you had a house to sell in San Francisco this summer, chances are you did pretty well. Almost one quarter of all houses sold this summer changed hands for more than 20% over the list price, and 17% of all houses sold were paid for in cash. I’m aware of at least a dozen houses that ended up getting 25+ offers in neighborhoods like Bernal Heights, Glen Park, and other popular areas. Continue Reading

Get in touch:

Eileen Bermingham

Zephyr Real Estate

415.823.4656

ebermingham@zephyrsf.com

BRE# 01352627

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