SF Property Report-Spring Update (April 15th)

Welcome to the SF Property Report. This a modified mid-spring update as the market has begun to move again in some areas and others, not as much but it’s still quite strong overall. 

We’re seeing that condominiums, particularly in areas with more single family homes, have taken longer to sell. The most value a buyer can find is in a condominium that needs updating. Beatiful, spacious and remodeled condominiums continue to do well, often receiving multiple offers. In between the two, there are some that take longer to sell and possibly require price adjustments but they do sell. Another significant factor is the pipeline of new condominiums selling with more on the way. Where people who would like to see the market go down are getting confused is that these properties are selling. They’re just taking a bit longer. There’s been no significant move downwards. Just a steady supply and an unsteady stock market and Presidential race. Condominium prices remain firm.

Single family homes below $2,000,000 are seeing the greatest increase in demand. In all districts of San Francisco, single family homes sell within weeks of their list date. Value can sometimes be found by making offers on tenant occupied property as most buyers want move-in ready homes. “Cosmetic” fixers aren’t showing much value as the cost of updating often exceeds the difference between their price and that of a similar remodeled home. 

Above $2,000,000 there was talk, and some say it’s still out there, that the high end of the market is weaker. I disagree. Statistically, 17 days on market is the average in Districts 5, 6, 7 which comprise most of the center and nothern ends of the city where these homes are found. That’s not a long time. That’s for an average home price of $3,666,000 and covers 42 sales that closed since mid - February. (I did take out two sales that were outliers and on the market for 6 months due to unusual circumstances. I don’t feel they contribute significantly to an argument for or against the current market climate) It seems reasonable to me that the average buyer wants to take more than 17 days to purchase a home that clearly has more going on than a home in the entry level price range.

Coincidentally, in those same districts where there are fewer “entry-level” homes, the number of sales that closed escrow is 20 with only one taking 60 days because it fell out of contract before going right back into contract. The average days on market was 25, so go figure! Average sale price of homes closing under $2,000,000 was $1,519,000. Average for all homes in districts 5,6 and 7 was $3,130,000. 

Let’s see where this goes and I’ll try to update as we head into the post Memorial Day to 4th of July summer slowdown. (Guaranteed) -Matt

 

Former post:

The local economic forecast remains quite strong. Influence by international economic difficulties has been thus far muted by the strength of the local tech boom. Unofficially, growth in the Valley in '15 was about 5-7%. This year is expected to be about 5% as well. As long as the Technology industry is growing locally, rents will stay at or near current levels and sales prices will be be maintained, if not increasing.  Influence by increasing interest rates has not changed and with the volatility of the stock market and the upcoming presidential election, not much movement is anticipated. Rates are lower right now than the were after the Fed raised rates earlier in the year. 

In short, it's easy to sell your home if you're relocating but challenging to move up to a larger home without enough cash reserves that enable you to buy and then sell. Bridge loans are possible and can be a way to get the home you've been looking for without having to sell and then rent while finding the right new home.  

If you're buying, there are opportunities, but you do need the help of an experienced agent. Value is not easy to come by but it's out there and I have testimonials to back that up. (Contact me if you'd like details on that!)

 Thank you! Matt 

 

The market is seeing strong and growing levels of activity as inventory has come on the market but in less supply than anticipated. People just aren't selling. They are, however, buying. Market entry homes and condominiums are seeing the highest levels of activity. Desirable homes of all types in great locations are selling very well. The high end of the market, with the exception of the aforementioned best of the best, is slower but is moving along. Marketing for these sales should be prepared accordingly. Contact me if you'd like details on that. 

The local economic forecast remains quite strong. Influence by international economic difficulties has been thus far muted by the strength of the local tech boom. Unofficially, growth in the Valley in '15 was about 5-7%. This year is expected to be about 5% as well. As long as the Technology industry is growing locally, rents will stay at or near current levels and sales prices will be be maintained, if not increasing.  Influence by increasing interest rates has not changed and with the volatility of the stock market and the upcoming presidential election, not much movement is anticipated. Rates are lower right now than the were after the Fed raised rates earlier in the year. 

In short, it's easy to sell your home if you're relocating but challenging to move up to a larger home without enough cash reserves that enable you to buy and then sell. Bridge loans are possible and can be a way to get the home you've been looking for without having to sell and then rent while finding the right new home.  

If you're buying, there are opportunities, but you do need the help of an experienced agent. Value is not easy to come by but it's out there and I have testimonials to back that up. (Contact me if you'd like details on that!)

 Thank you! Matt 

 

 

 

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