Category Archives: Twin Peaks

San Francisco Housing Market Continues to Strengthen

The San Francisco housing market continues to heat up, as evidenced by the increasing sale prices of homes in the city. Compared to one year ago, the median price for a single-family home rose by 10.6 percent to $785,000. And, with a limited supply of homes for sale, the city has remained a seller’s market, with aggressive bidding and multiple offers occurring regularly.

Single-Family Home Sales

Compared to May 2011, the city’s inventory of single-family homes for sale fell by 10.8 percent, while the number of homes under contract rose by 13.9 percent. During the same period, the number of homes sold increased by 23.3 percent.

For homes that were priced below $700,000, the months of supply inventory fell by 70.6 percent to a reading of 0.9. For higher-priced homes between $700,000 and $1.2 million, the months of supply inventory also dropped, by 52.7 percent to 1.1 months.

One area of the city which continues to experience healthy sales activity is Twin Peaks West, located in the mid-western part of town. Since May of last year, the number of homes under contract here has increased by 13.9 percent, while the number of homes sold has jumped by 23.3 percent, with 37 transactions closed. Twin Peaks West offers a variety of neighborhood communities, from the upscale and exclusive St. Francis Wood, to the charming mom and pop shops of the West Portal. Homes for sale here typically receive multiple offers and do not last on the market for very long. The median price for a home in Twin Peaks West is $918,000.

Another area of the city which experienced high sales activity is the northernmost district, which includes classic San Francisco neighborhoods such as the Marina and Pacific Heights. Compared to one year ago, the number of homes for sale in this region rose by 24.4 percent, being one of only three districts in the last month which experienced an increase in for-sale inventory. At the same time, the number of homes under contract increased by 18.8 percent, while the number of homes sold rose by 22.2 percent. Here you will find some of the most impressive views and properties in the city, and whose close proximity to Presidio Park and the waters of the San Francisco Bay, provide an endless array of outdoor recreational activities. The median price for a home here is $2,875,000.

Condominium Sales

In the same fashion as single-family homes, the inventory of condominiums for sale in the city dropped by 38.1 percent compared to May 2011. As a result, the number of condominiums under contract increased by 38.7 percent, while the number of condominiums sold rose by 9.1 percent.

For condominiums that were priced between $500,000 and $900,000, the months of supply inventory contracted by 72.5 percent to a reading of 0.9. For luxury condominiums priced above $900,000, the months of supply inventory also fell by 57.2 percent to 1.4 months.

One area of the city which experienced positive condominium sales activity is Downtown San Francisco, in the northeast section of town. Since May 2011, the number of condominiums under contract here increased by 4 percent to a total of 52 properties, making it the second highest district in the city with the greatest number of condominiums under contract. The number of condominiums sold also rose by 8.5 percent, with 51 units sold. Downtown San Francisco not only includes the center of the city’s commerce, it also features quintessential and historic San Francisco neighborhoods such as North Beach, or “Little Italy” as it is also commonly known, and Nob Hill, home to not only some of the city’s most luxurious condominiums, but also to a number of famous landmark hotels such as the Fairmont and Mark Hopkins. The median price for a condominium here is $734,333.

Outlook

The National Association of REALTORS® reports that, “Pending home sales retrenched in April following three consecutive monthly gains, but are notably higher than a year ago.” Lawrence Yun, NAR chief economist, said a one-month setback against a background of many months of gains does not change the fundamentally improving housing market conditions. “Home contract activity has been above year-ago levels now for 12 consecutive months. The housing recovery momentum continues,” he said.

The consumer confidence index, which had declined slightly in April, fell further in May. The index now stands at 64.9, down from a reading of 68.7 in April. Regarding the short-term outlook, Lynn Franco, director of the Conference Board Consumer Research Center, says that, “Consumers were less positive about current business and labor market conditions, and they were pessimistic about the short-term outlook. However, consumers were more upbeat about their income prospects, which should help sustain spending.”

According to the California Employment Development Department, California’s unemployment rate decreased to 10.8 percent in May, and nonfarm payrolls increased by 33,900 during the month for a total gain of 425,000 jobs since the recovery began in September 2009.

As reported earlier this month in the San Francisco Chronicle, “U.S. mortgage rates dropped to record lows for a sixth straight week as concerns over slowing job growth pushed investors into the safety of government bonds that guide interest costs. The average rate for a 30-year mortgage dropped to 3.67 percent from 3.75 percent in the week ended Thursday, Freddie Mac reported. It was the lowest rate in the mortgage-finance company’s records dating to 1971. The average 15-year rate declined to 2.94 percent, also a record, from 2.97 percent.”

Reduction Redux, in which I pick up the Gauntlet

When I posted Reduction Ad Nauseum,  I really just wanted a read on how the educated real estate populace explains and/or reacts to listings that have suffered not one, not two, but three or more price cuts. Still, one commenter Noe Guy said:

“Interesting observations but I wouldn’t put too much stock in them. First, you      picked all TICs. TICs were always more of a speculative area of the market–get financing as a group, hold everything together via legal contract, hope for condo lottery, refinance. Everything about it is more speculative, hence the standard discount of TICs to condos… In this market, that discount should be steeper due to higher risk.

In addition to the more speculative aspect of the TIC market, I’ve always believed that it’s very difficult to accurately price a TIC. It’s not just the property that’s for sale. It’s the property, the actual contract, and the partnership with other owners. Those other two intangibles (from an economic standpoint) make the market less transparent, less liquid, and more difficult to price.

The evidence you’ve sited above clearly makes this case, but keep it in context and look outside of TICs if you want a clearer picture…”
 
Well, geez, what observations? I just observed 3 properties with 3 or more cuts, and opined that buyers (like me, someday, Obama willing) tend to look at reduced properties as Tijuana specials, as in: $500K now? No, no, I don’t think so. Here’s $300K and a pity hug. My final offer.
 
But okay, Noe Guy. See, I love a challenge (else why would I be so sure I can buy a house on an English teacher’s salary, eh?). So here you go, 3 more properties, decidedly not TICs, that have come down more thrice or more in their careers on the market.

Continue reading

Reduction, Ad Nauseum

I’m not a Realtor, so I’ll tell something I’m more qualified to comment on: buyers’ perspectives. For instance, I can tell you how buyers looks at a property that’s been reduced more than twice. We feel sorry for them. They’re like awkward teenage boys at their first dance, pretending to be terribly busy with their shoe laces to avoid eye contact. We all know these boys can’t really be too picky; they have to take what they can get.

This analogy might not totally work for reduced priced properties. I’m just saying that as a buyer, we tend to feel a lot more powerful when we notice a home’s asking has come down not once, but twice– a feeling that multiplies with each subsequent reduction. That’s why, as a seller, I’d really hope my agent were savvy enough to price my home right. Of course, we can’t, unless we are Dione Warwick, know what the future holds, and some of the current meltdown has caught us by surprise. Still, the writing’s been on the wall awhile. Most literate people, I’d think, would have read it.

Case in point the next three properties, whose reduction history goes from bad to worse.

1. Studio TIC at 1059 Leavenworth St #5 San Francisco, CA 94109. Current price: $325,000. In over 120 days on the market, the list price has come down thrice:

Jul 02, 2008 $399,000
Jul 03, 2008 $329,000
Sep 09, 2008 $325,000 

2. 532 Clipper St #B San Francisco, CA 94114, currently at $539,000 is a 2 bed/1 bath TIC flat. In over 170 days on the market, it’s suffered 5 reductions, each one not very big, but the conglomeration of so many price cuts is pretty damning:

May 14, 2008 $679,000
Jun 11, 2008 $659,000
Aug 13, 2008 $639,000
Aug 28, 2008 $599,000
Sep 25, 2008 $570,000
Oct 28, 2008 $539,000

3. 3630 22nd St., San Francisco, CA.  A 2bed/1bath detached cottage TIC, this one I’ve saved for “worst” because though it has not been cut as often as the above property, the overall slash down is quite dramatic. In over 100 days on the market:

Jul 18, 2008 $749,000
Sep 05, 2008 $649,000
Oct 06, 2008 $589,000
Oct 29, 2008 $499,000

In this last case, the current price seems a lot more fair. I went to the open house yesterday and the listing agent informed me the place needed about $250K in repair and pest control. I have to wonder who would have ever, ever, ever paid the original list price.

I also wonder what other SF real estate agents or buyers or sellers think of these reductions overall, so I’m serving this blog up on the Front Steps for commentary. Take it easy on those awkward teen age boys though. Everyone, and everything, is fragile right now.

A Worse Punishment for Sisyphus: Policing Noise in a Metropolis

Hello out there, theFrontStep Readers! You may (or just as likely, may not) know my name from my blogs for Redfin. I’ve kindly been invited to write also for theFrontSteps, so here I am, on the steps, with my first blog.

So here’s the setting: last night, 2:00am, sultry night, people walking up from the bars, falling down, giggling. That noise doesn’t bother me much. I’d have to be a hypocrite if I tried to pretend I’ve never, after closing time, made too much noise under someone’s window as I staggered home. But another noise does bother me: some a-hole flooring his car and slamming on the breaks as he reaches the stop sign in front of my house. Then, from fully stationary, he floods the car again, tyring to go from zero to sixty instantaneously. Then he screeches off, circles the block, and comes back to do it again.

But we all live in a city. We can’t really expect quiet, can we? We can hope for it, and maybe in some areas, get it most of the time. But in the end, we’re sharing with a lot of people, some of them loud and possibly crazy. That’s why this new law aiming to curb SF noise interests me. Continue reading

Find your way to the Mid-Century…modern (429 Burnett)

Sometimes you just have to show some pictures, and dream. Five bedrooms, 4.5 baths, 3 parking spaces, 3600 square feet, listed for $2,790,000 about a month ago, into contract about 10 days ago, and “very nice” (say that like Borat). It is indeed an “Entertainer’s Dream”, so don’t forget we make a great fresh lime margarita, oh Mr./Mrs. buyer. ;-)

MLS

We’re working on a place to stash some surfboards, maybe at Burnett we could stash our telescopes.

-429 Burnett [MLS]

-A rectangle on end on the Great Highway [theFrontSteps]