theFrontSteps – San Francisco

I’ve been advocating for listing your property for sale during the typical doldrums for years, and occasionally a few brave souls take the plunge. Have a look at this image below and the data used to arrive at the conclusion next time you think it’s best to wait til Spring or Summer:

Why should you list your home right now and not wait until everyone else? It’s simple: Supply and Demand. The buyers are still out there, but the homes for sale are not. So when a good one comes up, it’s like chum in a pool of great whites.

As an example, I was at two open houses Sunday with a client, one at 468 Noe, the other at 442-444 Noe. It looked like a holiday block party, or a daytime Halloween Trick or Treat extravaganza. It was a frickin’ madhouse! Soooo many buyers…serious buyers…walking in and out of those homes. When I hold my own open houses I usually have to stay at the front door and greet visitors. At these open houses I was able to walk around and hear the conversations. Real conversations about what it will take to “win” it. How will their financing stack up against a potential cash buyer. They could “live with the kitchen”, or “we’re definitely going to remodel”. It’s the same with just about every other good house, priced right, in a good location. San Francisco simply has more buyers than good, quality, property for sale, and so I say again…it’s a great time to sell.

Buyers are out there. Don’t wait until your competition lists their home for sale. Do it now, and put some big fat Benjamins under your tree or next to your Manora.

[I have more stories to share about my own listings and buyer competition, so make sure to check back, or opt to receive theFrontSteps via email/RSS.]

-$415,000 over asking in Haight/Cole Valley [theFrontSteps]

Below is an excerpt from the San Francisco Market Focus Report published by the San Francisco Association of Realtors.

Despite Seasonal Summer Slowdown, SF Housing Market Continues to Show Strength as Pending Sales Rise

With many buyers, sellers, and agents away on vacation at this time of the year, the San Francisco housing market is experiencing normal patterns of slowing down, resulting in lower inventory and less activity throughout the city.

Regardless, there have been pockets of movement and market conditions are expected to pick up in late August and throughout September as many people return from their holiday. In addition, it is likely that more distressed properties will come onto the market as banks sort out and finalize their paperwork.

Single-Family Homes
Year-over-year, the number of single-family home sales under contract in July rose by 29.6 percent citywide. Since the start of 2011, it has soared by 73 percent throughout the city. For properties priced below $700,000, the months of supply inventory dropped by 54.6 percent to a reading of 1.8 months. For properties priced between $700,000 and $1.2 million, the months of supply inventory fell by 22.6 percent to 2.5 months.

One area of the city which has seen a spike in home sales activity is the southwest neighborhoods of Lake Merced. Since July 2010, the number of pending sales has increased from 13 to 27 properties and the number of completed transactions has jumped by 28.6 percent to a total of 18 units sold. The landscape of Lake Merced offers an abundance of recreational activities for outdoors enthusiasts, from hiking, jogging, and biking to fishing and golfing. [Surfing is not recommended.] Real estate here ranges from upscale properties in the Pine Lake Park neighborhood to more mid-priced homes in Merced Heights…Read More.

Market Focus Report August 2011 [San Francisco Association of Realtors]

Misha Weidman is back and he brings us this little nugget (also posted on his site):

…and this quote to go along with it:

Until June 2008, condo and home prices were in lock-step in terms of price appreciation and decline. Thereafter, homes fell first and further. In March 2009, the delta between condos and home prices was a whopping 13%. Since then, however, home prices have recovered smartly: as of June, homes are about 4.5% further off their all-time highs than condos.

What does this all mean? First of all, I wouldn’t take too much consolation just yet in the upward spike in both condo and home prices since the beginning of the year. If you take a look at the chart, this happens every Jan/Feb when people start buying out of the winter doldrums. I wouldn’t predict a bottom until we see what happens this winter.
Still, the current delta of only $100,000 between median condo and median home prices seems rather small. If people are just begging to know what the historical average is, let me know and I’ll find out.

Thank you! And we’d bet there are a few that would love a little historical average.

-Misha’s Blog and place for more data crunching

Lots of chatter (as usual) on one particular local blog regarding the continued decline of real estate, and the world for that matter. (We get it, we really do. At least they’ve chosen to beat white elephants now along with their dead horses.)

What we’d like to show you is something that is still happening, but going unnoticed by both mainstream media, and sidestream blogs…that is that homes are still selling, and they’re selling for realistic prices, in realistic amounts of time.

Take for example this 2 bed, 1 bath, Fuji apple at 2331 42nd Avenue that was purchased back in 2003 for $515,000.

By all accounts this home was (and still is) in need of some repair.

Enter the Macintosh apple: A 3 bed, 1 bath home at 2335 42nd Avenue right next door to our Fuji.

Almost identical homes in very similar condition at the time of sale. (Save for a bedroom off the sort of remodeled kitchen in the Mac, which in our opinion decreased the value because it blocks views and access to a potential deck from the kitchen, and thus our hesitation to compare as a Mac to Mac, or Fuji to Fuji).

This Mac was listed for $688,000 during the holiday doldrums, and the worst economic/real estate situation we have possibly ever seen.

So what happened to this Mac? It was snatched up in 11 days for $710,000.

Is that a 2003 sales price? Not quite.

Make no mistake, it’s bad out there, but not always as bad as you’re continually forced to read. Train wrecks will always get more attention.

-2331 42nd Avenue, 2 bed, 1 bath, $515k in 2003 [MLS]
-2335 42nd Avenue, 3 bed, 1 bath, $710k in 2008 [MLS]

Labor Day is behind us, which typically marks the beginning of Real Estate season. Many buyers are waiting for that special place to hit the market, and many sellers are getting their homes ready to place in the increasingly critical public eye, and hoping they sell prior to the looming Holiday Doldrums. More and more real estate blogs and “watch dogs” are among us, countless real estate listing sites have sprung up, and the mortgage market continues to spiral downward. Considerable amounts of money (new and old) are still pouring into the San Francisco economy, and those with means still have no problem qualifying for, and attaining, top-notch loans at insanely low rates.

By all accounts things are going to be interesting. Specifically, I’m busier than I’ve ever been. Generally, I think I’m lucky.

So now what?

Not a whole lot of inventory has hit the market this week. A quick glance at the MLS today shows 43 new SFR (single family residence) listings. Of them, two are in the Sunset, three in the Excelsior, two in Crocker Amazon, two in Portola, and one in Bayview.  All of the other new SFR listings are in other counties.

It makes sense. This is a big travel weekend and all. On the other hand, some people do make a point of getting out to look at properties during holiday weekends. 

To round it out, there are 58 solds, 34 pendings, and 14 contingents. The end/beginning of this month always sees a “solds dump.” 

– Fluj

In case you missed it, or aren’t yet receiving it, sfnewsletter put out their weekly market update on Friday. Here it is:

“Charts, Data, Trends

Just when you thought we’ve run out of ways to describe to you what is happening in this market, we come up with a lesson on the Intertropical Convergence Zone also known as the “Doldrums”.

“Early sailors named this belt of calm the doldrums because of the inactivity and stagnation they found themselves in after days of no wind.” We have a bit of mortgage pandemonium, a bit of buyer caution, a bit of unrealistic price expectations, a bit of holiday cheer, and a ton of media doom and gloom all coming together to create the San Francisco real estate market equivalent of the “Doldrums”. Don’t panic, the wind should blow again, it usually does so in late January.”

-sfnewsletter [website]

[Editor's note: Please excuse us. We are unable to moderate comments at this time, so they are disabled for this post. And they're on.]

Even if the market has cooled, and properties are seeing price reductions, they are still selling. There is a technique to employ that usually leads to the same outcome: Reduce, and Sell, and we might add, don’t panic.

Case in point, 411 Banks, a two bed, one bath, 1600 square foot single family home in Bernal Heights, listed in May at $750,000, price reduced and relisted in September at $699,000 and now on track to becoming a done deal during the holiday doldrums. From what we can tell it spent ~160 days on the market. The last recorded sale on MLS was in 1997 at $165,000.

What’s your favorite? The pink, the picket, or the 1997 price?

“Bay Area’s housing prices buck national trend, Median cost is up 6.6%, driven by strong upscale market, but number of homes sold is down 20%” (source: SFGate)

“-The Bay Area appears to be shaking off the nation’s housing doldrums.
Local home prices are still going through the roof, even though far fewer properties are changing hands. That contradicts the national real estate trend of slumps in both price and sales volume.
Why does the region’s housing seem to defy gravity?
It’s the wealth effect.

-Marin County established its own record with a median home price of $1,010,000 — the first county in California to pass the million-dollar mark…

-The median price for a single-family home nationally was $215,300 (Bay Area is $720,000)”-SFGate

It appears the word on the streets is now hitting the media. Thanks D.L. for the link!

-“Bay Area’s housing prices buck national trend, Median cost is up 6.6%, driven by strong upscale market, but number of homes sold is down 20%” [SFGate]
-Stats & Numbers [sfn BLOG]
-Tour de San Francisco (real estate) [sfnewsletter's tour of San Francisco's Micro-Markets]

Ever wish you could see the Bridge from here?  

Surprisingly every October when these things buzz our town, a lot of people complain of the noise, the rattling windows, and the deafening roar.  But we love it!  It usually means our Indian Summer is here, which is a great time to sell and list property.  The Outer Sunset/Parkside are unusually sunny, and the views from view properties are crisp and clean.   For now, brace for the icy Northwest winds of Spring, also typically a good time to list and sell, followed by the summer doldrums of fog and low activity.