As of the end of February, there were fewer total home, condo and loft sales in the first two months of 2018 than in any of the previous ten years. And while it’s impossible to say exactly what is causing the low number of sales, it is possible that buyer fatigue following six straight years of rising prices, interest rates jumps, and stock market volatility may all be contributing.
At the same time, the median sold price per square foot for a single family home broke the $1000 threshold for the first time in San Francisco. That is up almost 150% since it bottomed out at $408 in January, 2012. And, enough buyers are still buying that prices are still rising. February’s median home price crossed $1,700,000, another first.
Single Family Homes:
The three-month rolling average median sales price of $1,501,667 is up 17% over last year’s.
Year-to-date, new listings are down 7.4% while sales are down 9.7%.
February’s inventory of 1.4 months is 26% lower than in 2017.
80% of homes sold over their list price and the median percent of list price received was 113% in February
The three-month rolling average median sales price of $1,096,667 is up 3.13% over last year’s.
Year-to-date, new listings are down 14% while sales were up 9.2%.
February’s inventory of 1.9 months is 30% lower than in 2017.
59% of homes sold over their list price and the median percent of list price received was 103% in
Many separate but connected events occurring in the global, national and local economy may have an impact on the San Francisco real estate market this year, the extent to which is unknown. These include a jump in the inflation rate, increased stock market volatility, the bond market sell-off, the weak dollar and talk of a fourth rate increase this year by the Federal Reserve Board.
Home buyers are laser focused on mortgage interest rates, as well as how financially secure they feel with their investment portfolios. A gyrating stock market can not only reduce buyers’ ability to deliver on their downpayments but also deter their eagerness to make offers, let alone bid aggressively on them. As mortgage rates rise, and perhaps even more this year than anticipated, it hurt buyers in terms of the amount they can qualify for and sellers in terms of the downward pressure it puts on home values.
All that said, San Francisco still has a booming job market and buyer demand that well out-strips supply. It’s hard to imagine a truly shifted market place, yet these two sides may come a bit more into balance this year.
Single Family Homes:
The three-month rolling average median sales price of $1,350,000 is up 10.5% over last year’s.
In the past 12 months, new listings were down 5.9% while sales were up 0.94%.
January’s inventory of 1.1 months is 35% lower than in 2017.
70% of homes sold over their list price and the median percent of list price received was 108% in January.
The three-month rolling average median sales price of $1,050,000 is up 11.3% over last year’s.
In the past 12 months, new listings were down 7.5% while sales were up 2.4%.
January’s inventory of 1.6 months is 33% lower than in 2017.
39% of homes sold over their list price and the median percent of list price received was 100% in January.
2017 saw two foundational trends continue in the San Francisco real estate housing market. Prices continued their trend upward while inventory continued its trend downward. It marked the sixth straight year for higher sales prices for both single family homes and condo/loft/TIC’s.
Two changes, one already implemented and one in the making, may have a significant impact on the housing market, in San Francisco and across the country. First, the tax changes may impact buyer behavior with the reduction in deductibility of mortgage interest and possibly state income taxes and property taxes, with the latter two still up in the air.
Second, the projected three hikes in the federal funds rate by the Federal Reserve are anticipated to result in mortgage rate increases of ½ to ¾ percent by the end of 2018. Additional factors will affect mortgage rates so it’s impossible to predict where they’ll end up and how they’ll get there. No expert expects them to stay as low as they are currently.
Single Family Homes:
2017’s median sales price is up 12.2% from 2016.
There were 5.5% fewer new listings in 2017, and 1.5% more sales.
Inventory ended 2017 down 31% from 2016, the lowest level in 10 years.
78.7% of homes sold over their list price and the median percent of list price received was 113.4% for 2017.
2017’s median sales price is up 9.3% from 2016.
There were 6.2% fewer new listings in 2017, and 3.4% more sales.
Inventory ended 2017 down 24% from 2016, the lowest level in 3 years.
59.5% of homes sold over their list price and the median percent of list price received was 101.9% for 2017.
The November San Francisco real estate market moved along pretty much as expected, with continued low inventory and the majority of properties selling above list price. Condo prices hit an all-time high of $1,230,000.
The proposed tax changes are very likely to affect future buyer behavior as they lose purchasing power with the loss of full deductibility of state income taxes and property taxes. That loss of purchasing power will likely dampen sales price increases. Stay tuned…
Single Family Homes:
November’s median sales price eased off a bit from October’s all-time high of $1,588,000, down to $1,500,000. However, prices are still up 10.7% compared to last year.
While new listings typically fall off in November, this year’s were exceptionally low at just 112, 19% fewer than last November. The number of new listings on the market year-to-date is down 5% from 2016 while the number of sales is up 4.2%. Inventory remains very low at a 1.4 months supply, the lowest level since December 2016.
The incredibly tight supply coupled with strong demand kept the level of overbids high as well, staying at 115%, much higher than last November’s 107%. 81% of single family homes sold above the list price.
As mentioned above, the median sold price hit an all-time high in November. On a three-month rolling average, the median sold price is up 7.7% compared to last year.
Inventory is down 23%from October and 19% compared to November, 2016. Like single family homes, the number of Condo/Loft/TIC listings are down year-to-date compared to 2016, by 5.6%, while sales are up 3.2%.
59% of condo/loft/TIC listings sold above list price, down from 67% in October and 64% last November. The median overbid was 102%, the same as last November.
First, Just a friendly reminder that tomorrow is the last day to pay the first installment of your 2017-2018 property taxes without a 10% penalty.
To pay your San Francisco property tax, click here.
Second, I want to take just a moment to distill the thoughts I’ve been having about the current Republican Tax Reform effort: OH MY.
The tax reform plan may not really become effective due to some “glitches,” but it is probably prudent to observe some of the punitive portions of the proposed legislation directed at states with relatively high property values and therefore relatively high property taxes, which are:
- Eliminating some or all of the mortgage interest deduction,
- Limiting the deductibility of property tax payments; AND
- Shortening depreciation on investment properties.
These things might affect many of my clients as, well, the opposite of a tax cut. While I’m happy to pay taxes in the larger sense, I don’t much like it that it that my clients are going to foot the bill for massive tax cuts to only the biggest corporations.
Of immediate and actionable interest: according to FORBES, and many other sources, both the House and Senate versions agree to limit property tax deduction to $10,000 per year. In the past, property taxes on a personal residence could be deducted without limit. If your property taxes are more than $10,000 a year on all of your personal residences, it might makes sense to pay all of them for the 2017-2018 tax year tomorrow (or, at any rate, before the end of 2017) if you can. If you’re taxes are figured using the AMT rather than itemized deductions, this change might make no difference to you at all. I am not a tax expert, just a Realtor reading the newspaper trying to make sense of it all, so please do check with your tax advisor.
Many thanks to Living415sters Anne and Jesse for pointing out this workaround to me today. I couldn’t do any of this without ALL OF YOU! Thank you for your referrals, ideas and support. read more →
Single Family Homes:
August’s median sales price continued its predictable seasonal backing off from its Spring peak, dropping 6.4% to $1,380,000 from May’s $1,475,000. However, in the same time frame last year prices dipped 7.4%. Prices are still up 10.4% above August, 2016.
Since August, 2012, the median sold price in San Francisco is up 81%.
Inventory continues to be at its lowest level, 1.6 months, since last December. This is the ongoing result of fewer homes coming on the market while sales stay fairly constant. The number of new listings on the market year-to-date is down 7% from 2016 while the number of sales is up 3.3%.
The incredibly tight supply coupled with strong demand kept the level of overbids high as well, down a bit from July but still at 114%, and 79% of single family homes sold above the list price, up from 75.9% last August.
Median sold prices are up 10.8%, to $1,175,000, compared to August 2016. And, while not as great a rise as with single family homes, the median sold price is up 62.5% compared to August 2012’s $723,000.
In August, 63.4% sold above list price and the median bid was 3.2% above list price.
The number of Condo/Loft/TIC listings are also down year-to-date compared to 2016, by 10.7%. And, like single family homes, sales are up, by 2.6%. Current inventory stands at a 2 months supply.
July’s median sales price for single family in San Francisco followed its seasonal backing off of its May peak, dropping to $1,431,000 from May’s $1,500,838.
Single family home inventory continues to be at its lowest level, 1.6 months, since last December, and its lowest July level in a decade. This continues to be caused by fewer homes coming on the market, while sales stay fairly constant. The number of new listings on the market in 2017 is down 10% from 2016 while the number of sales is up 1.4%.
The incredibly tight supply coupled with strong demand pushed overbids up as well, to 117%, the highest since September, 2015.
Condo listings are also down year-to-date compared to 2016, by 12.7%. And, like homes, sales are up, by 4.3%, leading to a 2 months supply. And, like single family homes, condos were bid up above list price to a median overbid of 107%.
June’s median sales price for single family in San Francisco backed off a bit from its all-time high in May, dropping from $1,502,675 to $1,465,989. At the same time, single family home inventory was at the lowest level, 1.6 months, for June in 10 years. This is largely due to the fact that the number of new listings on the market in 2017 is down 8.8% from 2016 while the number of sales is up 1.3%.
The incredibly tight supply coupled with strong demand pushed overbids up as well, to 115%, the highest since October, 2015.
Condo listings are also down from 2016, by 13.3%. And, like homes, sales are up, by 6.6%, leading to a 2.2 months supply. So, like single family homes, condos sold at a median overbid of 102.5%, off just slightly from May’s 102.7%.
The exceptionally strong San Francisco economy continues to be behind these numbers. Unemployment stands at just 3.0%, down from 2016’s 3.4%. There are more jobs filled in every category tracked by the Bureau of Labor Statistics in June, 2017 than there were in June, 2016. And while the increase in the number of new jobs is slowing, jobs are still being added.
The median sales price hit an all-time high for both single family houses and condo/loft/TIC’s in May. The incredibly tight supply coupled with strong demand pushed the prices up and the overbids as well. Single family homes sold at a median overbid of 114.7%, the highest since October, 2015. Condos sold at a median of 103% of list price, the highest overbid percentage since May 2016.
As we discussed last month, the number of new single family home listings coming on the market was down sharply in April, 25.5%, and we saw that repeated again in May with a 12% year-on-year drop.
Likewise, the precipitous decline, 33.5%, in new condo/loft/TIC listings coming on the market in April, was followed by a 23% drop year-on-year for May. This is the third double-digit monthly year-on-year decline for new condo/loft/TIC listings this year.
The total number of single family homes sold was up 5.5% in May while condo/loft/TIC sales were unchanged.
Inventory stands at 1.8 months for single family homes, down 25% year-on-year, and 2.3 months for condo/loft/TICs, also down 25%.
Entering the heart of the holiday season, the number of sales and sales prices were mixed in the single family home and condominium/loft/TIC markets.
Single family home median sales prices dipped in November to $1,372,500 from October’s all time high of $1,407,500, but are still up $110,000, or 8.7%, from November, 2015.
In condominium/loft/TIC sales, median sold prices have been bobbing up and down between $1,000,000 and $1,150,000 for the past two years, and closed November at $1,044,500, just above the $1,023,500 where they started in January. Year-on-year, there is a 6.9%, or $78,000, decrease in the median sold price.
Inventory levels in November took their typical seasonal nosedive, dropping to just 1.7 months of inventory for single family homes and 2.1 months for condo/loft/TICs.
Finally, the median percent of list price received for single family homes was the lowest it’s been since January 2015: 106.8%. This could indicate that prices are peaking in the single family home market.
The information contained in this report is taken from a variety of sources including SFARMLS, SPUR, the City of San Francisco Planning Department, the Federal Reserve Bank of San Francisco, the Bureau of Labor Statistics, and others. The data may have errors, omissions and be subject to revisions and is not warranted. It is deemed reliable but is not guaranteed. Questions may be directed to Keller Williams San Francisco | 415.483.9285 | CalBRE 01995149 | © Keller Williams San Francisco 2016 read more →