Is the SF Real Estate Market improving?

Is the SF Real Estate Market improving? It depends.  Unclear answer, but there it is.  The article below spells out pretty well the conversion I’m having with both buyers and sellers.

Overall, I’d have to say that any current improvement is very slow.  Whether it’s summer, a retreat in consumer confidence, the Federal Tax  Credit expiration, or a combination, the market has slowed in the last month.

All that being said, multiple offers are still occurring (not nearly as frequently as in the Spring) and it’s hard to explain to buyers and sellers why with two similar properties, one sold (or is expected to sell) with multiple offers, over asking and another is languishing on the market with multiple price reductions.

A lot of it boils down to luck.  The buyers in the market place that week, the improvements you’ve taken on to best prepare a home for sale, the side of the street the home is on, or whether the likely buyer of your home went away for the weekend and didn’t look at your house.  In general, homes that are well-prepared and well-priced get looked at first.

My observation is that the current, motivated buyers have seen the home in the first two weeks-hence, an offer in the current market in the first two weeks is really important.  If it’s gone beyond that, we’re likely to get new buyers in the market, not ready to make a decision for 30 days or more-and folks, time is not your friend right now.  Time = price reduction.

About all that can be done is to keep communication open between you and your agent, and keep your ears to the tracks to see what the word is on the street about the property.  Remember, the more you see, both good and bad, the more you’ll know when to leap.

SF Real Estate Market-SFGate

Target may be coming to the Mervyns at Masonic and Geary

Mervyn’s at Masonic and Geary may be getting a new tenant. Target.  This seems like a great thing to me.  That building is enormous, and in my opinion, underused.  As I recall, it’s over 200,000 square feet.

An interesting tid-bit, I worked on that building for a short time when I was a practicing architect.  After Sears left and the developer was planning on how to split it up, I helped measure and document the building.  It is an interesting structure, really ahead of it’s time.  Did you know there is actually parking on the roof and an escalator that goes down into the store?

Target at Masonic and Geary-SFCurbed

New Parking Meters in San Francisco

New parking meters in San Francisco are planned for in a pilot program starting 7/2010

Look for new parking meters in Hayes Valley and several other San Francisco neighborhoods including West Portal in an effort to charge for congestion pricing and keep parkers moving, making spaces available for others.

The pilot program will run for two years and I suspect, begin implementation sometime thereafter. The meters will make it possible to pay with coins, parking cards and credit cards.

An update-I heard on the news a few nights ago (8/11/10) that the proposal to pay at meters on Sundays was scrapped.

New Parking Meters for SF-SFGate

The West Portal/Inner Parkside Second Quarter 2010 Real Estate Market Update

By Eric Castongia, Zephyr Real Estate

The West Portal/Inner Parkside Real Estate Market in the second quarter of 2010 was active.  A combination of a balanced inventory, historically low interest rates on mortgages, Federal Tax Credits and motivated sellers have maintained the number of sales in our neighborhood. 

Here is my interpretation of data from the San Francisco Multiple Listing Service and my observation of the real estate market in the West Portal/Inner Parkside area.

  • If you look at the number of transactions in this quarter, it would appear that inventory is steady year over year.  Our second quarter total transactions, including active properties is comparable for this time of year at 34; it was 31 in the second quarter of 2009.  For active listings from this year to last in the same quarter, there were six and seven respectively-also very consistent.
  • The number of sales in the second quarter (21) is higher than usual at this time of year; if you look at the average year to year, it’s around 12.  We had a very active first quarter, so there are transactions that started in the first quarter and finished in the second-there are fewer pending and withdrawn sales in the current quarter, as a result.
  • Of the 21 sales in the second quarter, seven had multiple offers (30%), 11 were over asking (52%) and nine closed under their asking price (43%).
  • For those homes that sold over asking, in general, we’re not talking about a big over-bid.  It seems to run from $5,000-$25,000 or so, unless the property is inappropriately underpriced, such as a home that went to auction on Claremont-listed at $449,000 and sold in the low $900,000s.
  • We are seeing more listings with attractive list prices to get buyers enticed to visit the property.  Time is most important right now; getting a listing to sell at or above asking must sell in the first few weeks.
  • Looking at the number of listings throughout the neighborhood, there is only one active listing in the immediate West Portal area-the other one we had is in contract with five offers over it’s asking price.  Active inventory in the neighborhood is tight.
  • The other five of the six currently active listings, are in the area outside prime West Portal/Inner Parkside which includes the area around the Safeway on Taraval and 19th Ave.  There are typically more homes for sale in this area, so that’s not a surprise.  What is of note-there are no withdrawn, or failed to sell listings, in this quarter in that area-that indicates that the price range is popular with buyers and that sellers are realistic on pricing.
  • As a realtor, determining list (and sales) prices has, in recent months, been less science and more art; it’s about buyer psychology, exposure and luck.  For West Portal/Inner Parkside, inventory is consistently light, so there is built-in demand-however, buyers being selective may mean that an inappropriately priced listing gets passed by.  That occurred with two such listings this quarter in the prime part of West Portal.
  • The new homes at the corner of 15th Ave and Wawona have all sold.  In the end, they sold at 10-15 percent below their original asking prices.  The sale prices ranging up to approximately 1.9 million dollars, have set a new benchmark in the neighborhood.
  • Interest rates, have bounced around a bit, but remain low.  The Fed, in their last meeting, has said that they will keep interest rates low for the foreseeable future.  They don’t want to stall the economy, nor do they want inflation to take hold.
  • Jumbo loans are back, as well as ten percent down financing-although not at the cheap rates that you hear about. Obtaining financing still requires lots of hoops to jump through; qualified buyers are gold.
  • Sales prices from the first to the second quarter of 2010 are flat.  While we are not seeing appreciation right now, we are balanced, so there aren’t a lot of stale listings sitting around dragging down prices.  Other San Francisco neighborhoods cannot boast this.
  • Despite the higher number of sales in the second quarter, price ranges didn’t go up overall.  I suspect that values will remain flat for the balance of the year.

Eric Castongia, Residential Sales Specialist at Zephyr Real Estate provided the information in this article.  Eric can be reached by e-mail at Eric@SFHotBuy.com, via the web at www.SFHotBuy.com  or via mobile phone at (415)307-1700.