San Francisco Home Market Continues to Strengthen
May 2010 Market Charts Analysis
Statistics are typically broad-brush generalities and are subject to fluctuations due to a variety of reasons. Median prices in particular may be affected by other market factors besides changes in value. All information contained herein is derived from sources deemed reliable, but may contain errors and omissions, and is not warranted. Sales not reported to MLS are not included in these analyses.
SF Homes Accepting Offers
The number of homes accepting offers in April 2010 continued to climb: 46% higher than one year ago; 33% higher than 2 years ago. It was the highest monthly total in years.
An overview of new listings, accepted offers, closed sales, price reductions, listings expired or withdrawn (without selling), and listings that came back on market (expired/ withdrawn listings that were re-listed, and accepted offers that fell through). The number of closed sales mostly reflects accepted-offer activity in February and March, which is the main reason for the discrepancy between the quantity of accepted offers and closed sales in April — the other reason being deals that fall through after offer acceptance. (Deals typically fail due to either financing or inspection issues.) Price reduction and back-on-market data are approximations. A single property can be included in more than one category within the same month.
Sales Price to Final List Price
The house market continues to be the hottest segment with 45% of all sales closing at over the final list price. For the other property types more sales occurred at under asking than over or equal to the final list price. The vast majority of homes selling over asking price accept offers within the first week or two of going on market.
SF Home Sales by Property Type
More houses sell than condos (not including new-development condo sales unreported to MLS). The TIC market has been hit very hard by changes in financing conditions.
Sales by Realtor District
The two districts with the most home sales are District 5 (Noe/ Castro/ Haight), and District 9 (South Beach/ SOMA/ Mission/ Potrero/ Bernal). The third most active is District 10 (Bayview/ Portola/ Excelsior), where most of the bank-owned house sales have been occurring. Median home prices range from $450,000 in District 10; to $655,000 in District 9; $750,000 in District 2 (Sunset/ Parkside); $875,000 in District 5; and $1,440,500 in District 7 (Pacific Heights/ Marina).
Homes Sales by Price Range
The market segment with the largest number of sales YTD was the $501,000 – $750,000 range. Of the 454 homes sold in this segment, 43 were bank-owned (REO) sales, about 9.5%. In the second largest market segment, homes $500,000 and under, 94 sales or 32% were bank-owned. As prices climbed, the number of sales decreased. The luxury home segment comprised about 10% of unit sales.
SF Median HOUSE Price
In April, the median house (SFD) price in San Francisco was $788,000, about 15% below April 2008. Monthly fluctuations in median price are unreliable as indicators of changes in value — one must look for consistent longer term trends. Sales prices are 30 – 60 days behind the market, since that is the typical period between offer acceptance and close of escrow.
SF Median CONDO Price
The median SF condo sales price in April 2010, at $698,000, was about 15% below the median in May 2008.
Sold vs. Expired/Withdrawn
The green bars delineate sales; the purple bars show expired and withdrawn listings. A fair number of listings continue to expire even as demand has markedly increased. Typically, listings expire or are withdrawn due to being perceived as overpriced.
MSI is a measure of how long it would take to sell the current inventory of homes for sale at existing rates of sale. The lower the MSI, the stronger is the market demand. In April 2010, the MSI for all home sales declined to a low 2.9 months, the lowest MSI for over 2 years. For houses and condos, the MSI is an even lower 2.5 months; for TICs and 2-4 unit buildings, the MSI is at 5.2 months and 5.9 months respectively. These last 2 property types make up a relatively small percentage of the overall SF home market.
Average Days-on-Market (DOM)
DOM measures the time between a listing going on market and it accepting an offer: the fewer the days, the hotter the market. The average days-on-market for all SF home sales in April, at 47 days, was the lowest in over 2 years. For specific property types, the DOM reflects the heat of each market segment: for houses, it was 39 days; for condos, 49 days; for TICs, 68 days; and for 2-4 unit buildings, it was 69 days. Of course, these figures are for homes that actually accepted offers, not the listings that didn’t sell. The DOM for all for-sale properties was 117 days in April.
Percentage of Listings with Accepted Offers
In April, the percentage of SF home listings which had accepted offers hit its highest level in over 2 years. For houses and condos, the rate is even higher, at just over 26%; for TICs and 2-4 unit buildings, the percentages are at 14% and 13% respectively.
Despite predictions that interest rates would rise after the Fed discontinued its bond-buying program on March 30, mortgage rates have remained near historic lows below 5%. The financial crisis in Europe may be playing a role in this. Most pundits still believe rates will rise as the year passes. The chart below, from Bankrate.com, shows 30-year rates over the past 3 years.
Highest Sales per Agent in the Bay Area
According to the May 7, 2010 edition of the San Francisco Business Times, in 2009, Paragon agents had the highest average dollar volume sales of any of the largest residential brokerages in the Bay Area. Paragon agents have held this position for the last 3 years.