By Arrian Binnings:
Heyyy mannn, what’s going on with your investment, mannn?
- Haight Money (Look Closely)
Well let’s find out. We looked at condo sales prices in the nabe (Haight Ashbury) from 1995 to present, capping each year at October 29th. Condos are by and large the most popular property type in the area. We tried the same analysis for single family homes but there just weren’t enough data points to be reliable. So what’s groovin’?
- Click to Zoom
Far out! Looks like…condos in the nabe have performed very well over the long haul. A little dip this year, but overall, solid growth. Actually, this chart looks strikingly similar to one we published the other day for Pacific Heights… perhaps even more stable.
The more we run these microanalyses, the more we are surprised that San Francisco’s resilience is not just some amorphous idea… that it really is weathering the tough times well. The proof is in the numbers. Could there be a lag? Could it go down anyway? The answer to these questions is of course, yes, anything is possible. But we feel that property values and sales prices remain propped up due to San Francisco’s desirability as a city to live in coupled with its scarce inventory levels (at least in certain neighborhoods).
It’s a little ingeniousness to only plot bubble prices. The last bubble was 1985-1995. So the graph above only shows a few years of normal growth followed by the present bubble.
It would be more instructive to show prices through both bubble and non-bubble time, say 1960 to present. Also inflation adjusting is essential when you have a time scale of more than a few years and a few of the years (including 2000-2008) were high inflation.
I mean disingenuous. :)
The reason I look at a 15 year history is two-fold:
1) Most people I meet looking to buy a home are looking to hold for ~7 years. So I double that when looking back in time to show 2 cycles of home ownership.
2) While I agree that going back further would be great, MLS data gets shadier and shadier the further back you go. Before MLS was computerized it was in big books. So I’m just working with what I’ve got, and going back to #1, it seems sufficient for most people looking to get into the market for a typical 5-10 year hold period.
Lastly, the median sales prices are what they are. That’s all I’m reporting on. If you’d like to adjust for inflation or any other phenomena, be my guest. I’ve given you the baseline numbers to get started with :)
the graph and #’s they reflect are telling- SF RE has had very strong appreciaiton over a 15 year span. if you go back another 15 years, you will also see strong appreciation- probably in the range of 4-5% appreciation per annum.