Category Archives: Stats & Numbers

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It’s Friday! Top 10 Overbids To Spark Your Cocktail Conversations Tonight

You’re all probably wondering where the hell I went. I’m here. Representing buyers and sellers in this frenzied market. This market that is full of crazy overbids, properties getting many multiples of offers, and at the same time properties that are now sitting in the dead pool. I call these “Stalefish” a.k.a. 30+ Club, and you can see some of them here.

But it’s Overbids, the Top 10 to be specific, that you came to see, so here they are. Have a great weekend!

Address BR/BA/Units DOM List Price Sold Price Overbid
3955 19th St 2/2.00/N/A 12 $1,195,000 $1,830,000 53.14%
1493 Newcomb Ave 2/1.00/N/A 3 $408,888 $623,700 52.54%
14 Ulloa St 2/1.00/N/A 25 $798,000 $1,125,000 40.98%
662 Elizabeth St 2/1.00/ 9 $799,000 $1,105,750 38.39%
369 Arguello Blvd 371 2-4 Units 29 $1,650,000 $2,250,000 36.36%
131 Harold Ave 2/1.00/N/A 16 $599,000 $805,000 34.39%
3615 20th St 2/2.00/6 13 $1,049,000 $1,400,000 33.46%
525 27th Ave 527 2-4 Units 21 $1,190,000 $1,580,000 32.77%
460 Andover St 4/2.50/N/A 10 $1,250,000 $1,650,000 32.00%
17 Valletta Ct 19 2-4 Units 36 $1,100,000 $1,450,000 31.82%

-Properties Still available [The Goods 30+ Club]

June Case-Shiller Index – High-Tier Home Prices Begin To Plateau For Summer

The Case-Shiller Index for the San Francisco Metro Area covers the house markets of 5 Bay Area counties, divided into 3 price tiers, each constituting one third of unit sales. Most of San Francisco’s, Marin’s and San Mateo’s house sales are in the “high price tier”, so that is where we focus most of our attention. The Index is published 2 months after the month in question and reflects a 3-month rolling average, so it will always reflect the market of some months ago. June’s Index was just recently released.

The 5 counties in our Case-Shiller Metro Statistical Area are San Francisco, Marin, San Mateo, Alameda and Contra Costa. Needless to say, there are many different real estate markets found in such a broad region, and it’s probably fair to say that the city of San Francisco’s market has generally out-performed the general metro area market.

Typically, the market cools off and plateaus for the summer months and that is what we are starting to see in the new Case-Shiller numbers for June. The next big indication of market conditions and trends will come after the autumn selling season begins in mid-September: That is typically when there is a large surge in new listings and buyer demand picks up again until the holiday slow-down begins in mid-November. It is difficult to make definitive statements about the market during the summer and mid-winter holidays because the market almost always slows substantially during these times.

The high-price home segment for the SF Metro area saw no significant change from May to June, though the low and mid-price segments both ticked up by a percentage point or two. Short-term fluctuations are much less meaningful than longer-term trends.

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To learn more about Seasonality & The San Francisco Real Estate Market, check out my most recent issue of sfnewsletter by clicking that link.

As always, if you have any questions, you should know where to find me by now.

-Seasonality & The San Francisco Real Estate Market [sfnewsletter]

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Case-Shiller Home Price Index Update For The San Francisco Bay Area

The Case-Shiller Index report for May 2014 for the 5-county San Francisco Metro Statistical Area was released the other day, showing another small bump in home prices from April to May. The aggregate or total index is now up approximately 55% since the market recovery began in early 2012. The 5 counties covered by the index are San Francisco, Marin, San Mateo, Alameda and Contra Costa.

However, Case-Shiller also breaks out home price changes by price tier – low, middle and high – and each tier has experienced dramatically different trend lines since 2000. The low price tier – homes found mostly in Alameda and Contra Costa counties (though also other Bay Area counties not in the SF MSA, such as Solano, Sonoma and Napa) experienced a crazy bubble much larger than the other price tiers and subsequently experienced a much bigger crash due to foreclosures and short sales. The middle and high price tiers, which predominate in San Francisco, Marin and San Mateo, experienced much smaller bubbles and crashes. This is dramatically illustrated in the first graph below.

In all the Case-Shiller Indices the numbers refer to a January 2000 home value of 100. Thus a reading of 195 signifies a value 95% above that of January 2000.

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All tiers have seen big recoveries since 2012 began, but only the high-price tier has now exceeded previous peak values attained in 2006-2007. Because of the absurd size of the low-price tier bubble, its home prices are still far below previous peak values and it’s probably unreasonable to expect them to be surpassed anytime soon.

However, all the price tiers show very similar overall appreciation rates since 2000, running from 93% to 97% over the 14 ½ years, which suggest an equilibrium is being achieved across the general market.

This chart below tracks home price appreciation for higher-priced homes since 2012. As with all statistics, monthly statistics are much less meaningful than longer term trends.

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San Francisco itself, whose median house price is now over $1.1 million, has performed significantly better than even the general high-price tier, as can be seen in the median price chart for the Noe & Eureka Valleys neighborhoods of the city.
This chart is just a sample of how some San Francisco neighborhoods – especially its most expensive ones – have far exceeded general Bay Area appreciation trends, as far as previous peak values are concerned. Many of San Mateo’s cities have experienced a similar dynamic, as they both share the dominant effect of the high-tech wealth effect on home prices.

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If you would like more information about these charts, or the San Francisco market in particular, give me a shout.

Noe Valley – Eureka Valley Homes Cross $1000 per sqft, Glen Park home sales up 12% YOY

Below you will find important statistics for the past decade and a half on the luxury markets in District 5. The price point has reached $1.5M for an average home in Glen Park and more than $2M to own a home in Noe Valley and Eureka Valley. Note that the 2014 data are year-to-date, between 1/1/2014 to 7/25/2014.

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San Francisco Condo Prices Continue to Rise: $1,144 per sqft (new condo), $953 per sqft (resale)

According to The Mark Company Trend Sheet, the value of new construction condominiums in San Francisco was $1,144 per square foot in June, up 13 percent year over year, and the value of resale condominiums was $953 per square foot, up 23 percent year over year.

Below you will find the recent new construction and resale condominium report from the Mark Company, one of the leaders in new development sales in San Francisco, and the market guys behind the enormously successful Amero, Arden, 8 Octavia, Park 181, as well as past home runs at The Brannan and 733 Front. They have extensive knowledge and analysis on our real estate market for high rise, luxury, and new constructions, as well as how these properties are being resold.

San Francisco condominium prices rose 13 percent in June 2014 over the previous year, according to the Condominium Pricing Index released by The Mark Company.

The Condominium Pricing Index for June was $1,144 per square foot, which is up 2 percent from May. New construction inventory was 63 percent higher than a year ago, but down 2 percent from the previous month, with 401 units now available.

“While several new developments have begun selling recently in San Francisco, including Arden by Bosa and 8 Octavia, the additional inventory has not been sufficient to stop the persistent appreciation in prices in recent months,” noted Erin Kennelly, senior director of research, The Mark Company.

The Condominium Pricing Index, part of the firm’s monthly Trend Sheet (available at http://www.themarkcompany.com), represents the price per square foot of a new 10th floor, 1,000-square-foot condominium. It is based on recent sales data, and uses a proprietary quantitative method to measure trends in market demand. It tracks the value of a new construction condominium without the volatility of inventory changes.

The Mark Company Penthouse Pricing Index, which applies the same methodology to a new 30th floor, 2,000-square-foot condominium, was $1,964 per square foot in June, up 13 percent year over year.

The condominium price per square foot was $953 for resales, up 23 percent year over year and up 2 percent from May 2014, according to The Mark Company Trend Sheet for San Francisco. In addition, there were 268 condominium resales in San Francisco in June, 274 active condominium listings representing approximately one month of inventory, and 168 pending condominium listings, the Trend Sheet found.
Available units include less than 117 residences at Arden in Mission Bay, 29 residences at 8 Octavia in Hayes Valley, 16 condominiums at 1645 Pacific in Nob Hill, 23 units at Fifteen Fifteen in the Mission District, 20 condominiums at Millwheel North in the Dogpatch, 11 units at the Mint Collection in the South of Market neighborhood, and 74 residences at Vida in the Mission District.

The Mark Company Trend Sheet - San Francisco - June 2014_Page_1

The Mark Company Trend Sheet - San Francisco - June 2014_Page_2

San Francisco’s Top 10 Overbids

From $1,400,000 to $14,000,000 on 25th Ave?! Are you kidding me!? Yes, that’s a typo for sure. Agent error. Fat fingers. Something. It’s not right. But the rest – wow!

Address BR/BA/Units DOM List Price Sold Price Overbid
2910 24th Ave 4/2.00/N/A 10 $1,400,000 $14,000,000 900.00%
140 Jerrold Ave 3/1.50/ 7 $215,000 $413,000 92.09%
1725 Kearny St 5 2/2.00/5 14 $1,450,000 $2,450,000 68.97%
2186 14th Ave 2/1.00/N/A 1 $949,000 $1,500,000 58.06%
1574 Innes Ave 2/1.00/N/A 14 $599,000 $915,749 52.88%
2546 McAllister St 2548 2-4 Units 60 $995,000 $1,510,000 51.76%
228 3rd Ave 3/1.00/N/A 12 $995,000 $1,475,000 48.24%
2475 15th Ave 4/2.00/N/A 20 $1,195,000 $1,695,000 41.84%
141 Beaver St 2/2.00/N/A 18 $1,798,000 $2,507,000 39.43%
270 Valencia St 2/1.00/206 13 $648,000 $900,000 38.89%

Have a great weekend.

Don’t forget, we have the full Top 20 on The Goods, and Top 20 Underbids too.

-The Goods, Because your clients deserve better.

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Case-Shiller: New Jump In Bay Area Home Prices

The new S&P Case-Shiller Home Price Index for April 2014 came out today and it showed another bump in home prices for the 5-county San Francisco Metro Statistical Area. For homes in the upper tier of home values – as most of San Francisco’s are – prices are up approximately 17% in the past 12 months and up 41% since the recovery began in early 2012.

Based upon what we are seeing on the ground in the market, we expect another bump in the May Index, which will come out at the end of July.

image001 image002 image004Be sure to check back on theFrontSteps for future reports as well as all the good stuff you’ve come to love from us – including the top 10 Overbids of the Week, which will come out tomorrow.

USA is through to the next round!!  (Sorry if you had it recorded and I just spoiled.)

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Recessions, Recoveries & Bubbles

My company just put out some heavy duty data crunching that can shed some light on this recent housing boom. I have put the entire report below. Enjoy and share.

 30 Years of Housing Market Cycles in San Francisco

Updated Report

Below is a look at the past 30 years of San Francisco Bay Area real estate boom and bust cycles. Financial-market cycles have been around for hundreds of years, all the way back to the Dutch tulip mania of the 1600’s. While future cycles will vary in their details, the causes, effects and trend lines are often quite similar. Looking at cycles gives us more context to how the market works over time and where it may be going — much more than dwelling in the immediacy of the present with excitable pronouncements of “The market’s crashing and won’t recover in our lifetimes!” or “The market’s crazy hot and the only place it can go is up!”

Market Cycles: Simplified Overviews 

Up, Down, Flat, Up, Down, Flat…(Repeat)

Case-Shiller_Simplified_from-1984

Case-Shiller_Simpl-Percentages

Smoothing out the bumps delivers these simplified overviews for the past 30 years. Whatever the phase of the cycle, up or down, while it’s going on people think it will last forever: Every time the market crashes, the consensus becomes that real estate won’t recover for decades. But the economy mends, the population grows, people start families, inflation builds up over the years, and repressed demand of those who want to own their own homes builds up. In the early eighties, mid-nineties and in 2012, after about 4 years of a recessionary housing market, this repressed demand jumps back in (or “explodes” might be a good description) and prices start to rise again. It’s not unusual for a big surge in values to occur in the first couple of years after a recovery begins.

Surprisingly consistent: Over the past 30+ years, the period between a recovery beginning and a bubble popping has run 5 to 7 years. We are currently about 2.5 years into the current recovery. Periods of market recession/doldrums following the popping of a bubble have typically lasted about 4 years. (The 2001 dotcom bubble and 9-11 crisis drop being the exception.) Generally speaking, within about 2 years of a new recovery commencing, previous peak values (i.e. those at the height of the previous bubble) are re-attained — among other reasons, there is the recapture of inflation during the doldrums years. In this current recovery, those homes hit hardest by the subprime loan crisis — typically housing at the lowest end of the price scale in the less affluent neighborhoods, which experienced by far the biggest bubble and biggest crash — may take significantly longer to re-attain peak values, but higher priced homes have already done so.

This does not mean that these recently recurring time periods necessarily reflect some natural law in housing market cycles, or that they can be relied upon to predict the future. Real estate markets can be affected by a bewildering number of economic, political and even natural-event factors that are exceedingly difficult to predict.

Mortgage Interest Rates since 1981

It’s much harder to decipher any cycles in 30-year mortgage rates over the same period. Despite the rate spike over the summer, rates remain very low by any historical measure, and this, of course, plays a huge role in the ongoing cost of homeownership.

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In the 2 charts below tracking the S&P Case-Shiller Home Price Index for the 5-County San Francisco Metro Area, the data points refer to home values as a percentage of those in January 2000. January 2000 equals 100 on the trend line: 66 means prices were 66% of those in January 2000; 175 signifies prices 75% higher.

1983 through 1995 

(After Recession) Boom, Decline, Doldrums

Case-Shiller_HT_1983-95

In the above chart, the country is just coming out of the late seventies, early eighties recession – huge inflation, stagnant economy (“stagflation”) and incredibly high interest rates (hitting 18%). As the economy recovered, the housing market started to appreciate and this surge in values began to accelerate deeper into the decade. Over 6 years, the market appreciated almost 100%. Finally, the eighties version of irrational exuberance — junk bonds, stock market swindles, the Savings & Loan implosion, as well as the late 1989 earthquake here in the Bay Area — ended the party.

Recession arrived, home prices sank, sales activity plunged and the market stayed basically flat for 4 to 5 years. Still, even after the decline, home values were 70% higher than when the boom began in 1984.

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1996 to Present 

(After Recession) Boom, Bubble, Crash, Doldrums, Recovery

Case-Shiller_HT_1996-2011This next cycle looks similar but elongated. In 1996, after years of recession, the market suddenly took off and became frenzied — actually quite similar to what we’re experiencing today. The dotcom bubble pop and September 2001 attacks created a market hiccup, but then the subprime and refinance insanity, degraded loan underwriting standards, mortgage securitization, and claims that real estate never declines, super-charged a housing bubble. Overall, from 1996 to 2006/2008, the market went through an astounding period of appreciation. (Different areas hit peak values at times from 2006 to early 2008.) The air started to go out of some markets in 2007, but in September 2008 came the market crash.Across the country, home values fell 15% to 60%, peak to bottom, depending on the area and how badly it was affected by foreclosures — most of San Francisco got off comparatively lightly with declines in the 15% to 25% range. The least affluent areas got hammered hardest by distressed sales and price declines; the most affluent were typically least affected. Then the market stayed flat for about 4 years, albeit with a few short-term fluctuations. Supply and demand dynamics began to change in mid-2011, leading to the market recovery of 2012.

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San Francisco from 2010 to 2014

A Strong Recovery


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Case-Shiller_High-Tier_2011

In 2011, San Francisco began to show signs of perking up. An improving economy, soaring rents, low interest rates and growing buyer demand coupled with a low inventory of listings began to put upward pressure on prices. In 2012, as in 1996, the market abruptly grew frenzied with competitive bidding. The city’s affluent neighborhoods led the recovery, and those considered particularly desirable by newly wealthy, high-tech workers showed the largest gains. However, virtually the entire city soon followed to experience similar rapid price appreciation.

San Francisco median home sales prices increased dramatically in 2012 and then accelerated further in the first half of 2013. San Francisco and the Bay Area are in the midst of a very dramatic recovery. Among other positive signs, new home construction is soaring once again, generally in the form of large new condo projects.

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Different Bay Area Market Segments:
Different Bubbles, Crashes & Recoveries

1990 to Present

Case-Shiller_3-Tiers_Trends

Again, all numbers in the Case-Shiller charts above relate to a January 2000 value of 100: A reading of 182 signifies a home value 82% above that of January 2000. These 3 charts illustrate how different market segments in the 5-county SF metro area had bubbles, crashes and now recoveries of enormously different magnitudes, mostly depending on the impact of subprime lending. The lower the price range, the bigger the bubble and crash. The upper third of sales by price range (far right chart) was affected least by the subprime fiasco and has now basically recovered peak values of 2006-2007. In the city itself, where many of our home sales would constitute an ultra-high price segment, if Case-Shiller broke it out, many of our neighborhoods have risen to new peak values. The lowest price segment (far left chart), more prevalent in other counties, may not recover peak values for years. If one disregarded the different bubbles and crashes, home price appreciation for all three segments since January 2000 is almost exactly the same, in the range of 75% to 82%.

All data from sources deemed reliable,
but may contain errors and is subject to revision.All numbers are approximate and percentage changes will vary
depending on the exact begin and end dates used.

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San Francisco Demographics

A statistical breakdown by household income, education, homeownership, foreign-born population, household size, age and other criteria.

The below charts and table are based upon U.S. Census surveys from 2010 – 2013. Please note that zip codes often contain neighborhoods of widely different demographics. For example, 94115 includes Pacific Heights, one of the most affluent areas of the city, as well the Western Addition, which is much less affluent. A number of SF zip codes are like this and when mixing very different neighborhoods together, you often end up with statistics that don’t really apply to any of them. Zip codes are relatively blunt instruments for demographic investigation, but we still found the analysis to generate interesting, new insights into San Francisco, our ever-changing city.

Each chart illustrates the data for 10 to 12 SF zip codes. Below the charts is a complete table of all the data collected.

The neighborhoods associated with zip codes in the charts and table below are simply representative labels; other neighborhoods are contained within each zip code and many are divided between two or more zip codes.

Median Household Income 

Many factors impact this statistic: household size, level of education, percentages of homeowners vs. renters, whether the rental units are subject to rent control, median resident age, quality of housing, and cost-of-housing issues besides rent control. The South Beach-Yerba Buena zip code takes top place for median household income in San Francisco. Interestingly, it is at the bottom of the ranking for average household size. This zip code is dominated by newer condo projects, many of them at the top of the price scale and the rental units here, which make up over half the housing, are typically not under rent control. The second ranked zip code for income is quite different: the St. Francis Wood-Miraloma Park area has a completely different ambiance, very few condos or renters, older residents and bigger households. And number 3 is the Presidio Trust zip code with no homeowners, all renters but no rent control, and younger residents than either of the first two. All 3 of the top zip codes, however, have very high percentages of residents with bachelor’s, graduate and professional degrees.

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