The West Portal/Inner Parkside 2017 Annual State of the Neighborhood

Year-End Real Estate Market Update

By Eric Castongia, Zephyr Real Estate

Citywide, the real estate market in 2017 got off to a slow start, and then took off like a shot in March and April. Buyers remained active and anxious until Labor Day, after which, they were more critical about property values and flaws.  West Portal/Inner Parkside remains in it’s own bubble of desirability; when something comes up, it generally sells immediately-unless it’s overpriced.  Here are some interesting stats for the year:

  • The total number of sales for 2017 was 58, up from 46 in 2016.  Adding a layer and a trend line, 2015 had 42; historic normal has been around 50 annual sales.  The rise in sales could be seller anticipation of a height in the market.
  • In the last quarter of 2017, there were 17 sold properties, with 13 receiving multiple offers over asking.  The amount of over bids ranged from as little as $101,000 to as much as $550,000.  The most under asking price was $100,000.
  • 48 of the 58 sales for the year were multiple offers, and 46 of them (79%) were over asking.
  • Four of the year’s transactions identify as ‘failed to sell’, however, in the final tally, two of those properties did ultimately sell-having to be taken off the market, repriced and remarketed.  It is remarkable that only two properties failed to sell the whole year, indicating both motivated sellers and buyers.
  • For sales reported as all cash; there were eight for the year (14%), essentially holding steady from 2016’s seven (15%).  Interestingly, 26% of the market in 2015 reported cash sales.
  • In most cases, buyers writing offers with loans did not include financing contingencies, taking on the risk of getting a loan, in order for their offers to look more attractive in competition.
  • To determine property values from quarter to quarter and year to year, I look at various housing types (such as two story homes, or typical two bed, one bath homes with rooms down) and neighborhood sub-districts (such as core West Portal/Inner Parkside vs. North of Ulloa); I find this method more accurate than median price.
  • For example, values of typical ‘two ones’ with rooms down in core West Portal Inner Parkside, seem to be level from quarter to quarter and year to year.  Whereas, the same type of home North of Ulloa, which has historically been less expensive, values have increased six percent from quarter to quarter and 16% year to year, putting the prices of those homes on par with West Portal and Inner Parkside.  My thought is that we could be reaching the top limit of affordability for this type of home.  Buyers instead, are changing neighborhoods, ir moving out of the city out of frustration and lack of options.
  • Moving to other housing types, the number of ‘super-remodeled’ homes has increased steadily, but not quite enough to compare them quarter to quarter and year to year.  Since they are so different than the local housing stock, I am using them sparingly in comparisons.
  • Two story homes have always been a premium.  They have continued to rise in price and I’m figuring the increase from quarter to quarter and from year to year, is approximately eight to 11 percent.
  • The beginning of 2018 ramped up quickly; mainly from a lack of inventory and buyers who were not successful finding a home last year.  I am telling my seller clients to get on the market as soon as they can.
  • Buyers need to set priorities and be willing to buy less house than they would like and very likely in areas they hadn’t planned.  As affordability becomes an even bigger issue, the question is whether it will trigger a break in the market.

Eric Castongia, Broker Associate at Zephyr Real Estate (BRE Lic. No. 01188380) provided this information. The content of this article is an interpretation of data from the San Francisco Multiple Listing Service, the County Tax Record, the internet and Eric’s observations in the marketplace.  Eric can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.

The West Portal/Inner Parkside Real Estate Update

Third Quarter 2017 Market Update

By Eric Castongia, Zephyr Real Estate

The real estate market got off to a slow start this year, but once it started, we didn’t see the summer slow down that has occurred for the last two years.  Buyers were/are waiting semi-patiently for homes to come onto the market, but remain in the driver’s seat, deciding what properties are worth and leaving the ones that are challenging and/or poorly priced; there are three in the neighborhood in the last quarter that buyers left on the market.

  • At the end of the third quarter, there were three active, nine pending, three withdrawn (failed to sell) listings and 11 sold properties; all 11 received multiple offers and 10 sold over asking. The amount of overbids ranged from as little as $180,000 to as much as $382,000.  Contrast this with third quarter 2016 with a similar number of sales, but overbids ranging from $50,000 to $300,000.   Offers have become more aggressive and prices have gone up, despite lower list prices.
  • In the second quarter of this year, comparatively, there were more sales (19-not unusual for that time of year) and some higher overbids. The amount of over bids ranged from as little as $101,000 to as much as $630,000.
  • There was only one sale reported as all cash (no loan); there were five in the previous quarter.
  • There were a few ‘apples’; properties that have sold and resold in a short period of time. One example is a property selling for $1.049m in 2014, with a subsequent interior remodel, selling recently for $1.710m.  Figuring the sellers could have put $250k into the remodel, the return on that one was still good for a 4 year hold.
  • As part of my tracking, for kicks and a little history, I note when properties last sold. A few interesting ones from the 1970’s popped up.  One selling in 1973 for $42,500 is currently listed for $1.659m and another selling in 1974 for $77,500 is listed for $2.195m.  The lower priced one went up 39 times its original value; by my calculation 3900% appreciation.
  • Figuring out the appreciation rate has been more of an educated guess than a science. Year to year, the numbers showing up in comparing various homes range from 11 to 30 percent appreciation.  Realizing that’s a big spread, the ‘X’ factor takes into consideration what is in the market place from quarter to quarter, their location and condition.  A case in point, a grand West Portal home a block from the Avenue sold a year ago for $2.33m.  In the current quarter, an Inner Parkside house of 1960’s vintage and similar size sold for $2.425m.  Year over year, that appreciation rate is about 4%.  West Portal homes sell for more than Inner Parkside homes, as do older vintages, over more modern ones.  I think the real appreciation rate is more like 20-25% year to year, which is hard to show, since there isn’t anything matching last year’s home.  For those of us who have been around for a while, it wasn’t that long ago that sales prices going over $2m was astounding.
  • Making an educated guess, an 10-15% year to year appreciation for most homes is more realistic, and those with ‘Dwell Magazine’ level remodels seeing more aggressive pricing (that 25-30% number); as most people don’t want to deal with remodeling and will pay a premium.
  • What will happen next? Hard to say.  With the Bay Area employment market and a restricted inventory, I think we are in good shape for the short term to keep our upward pressure on the market.

Eric Castongia, Broker Associate at Zephyr Real Estate (BRE Lic. No. 01188380) provided this information. The content of this article is an interpretation of data from the San Francisco Multiple Listing Service, the County Tax Record, the internet and Eric’s observations in the marketplace.  Eric can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.

The West Portal/Inner Parkside Real Estate Update

Third Quarter 2017 Market Update

By Eric Castongia, Zephyr Real Estate

The real estate market got off to a slow start this year, but once it started, we didn’t see the summer slow down that has occurred for the last two years.  Buyers were/are waiting semi-patiently for homes to come onto the market, but remain in the driver’s seat, deciding what properties are worth and leaving the ones that are challenging and/or poorly priced; there are three in the neighborhood in the last quarter that buyers left on the market.

For West Portal/Inner Parkside:

  • At the end of the third quarter, there were three active, nine pending, three withdrawn (failed to sell) listings and 11 sold properties; all 11 received multiple offers and 10 sold over asking.  The amount of overbids ranged from as little as $180,000 to as much as $382,000.  Contrast this with third quarter 2016 with a similar number of sales, but overbids ranging from $50,000 to $300,000.   Offers have become more aggressive and prices have gone up, despite lower list prices.
  • In the second quarter of this year, comparatively, there were more sales (19-not unusual for that time of year) and some higher overbids.  The amount of over bids ranged from as little as $101,000 to as much as $630,000.
  • There was only one sale reported as all cash (no loan); there were five in the previous quarter.
  • There were a few ‘apples’; properties that have sold and resold in a short period of time.  One example is a property selling for $1.049m in 2014, with a subsequent interior remodel, selling recently for $1.710m.  Figuring the sellers could have put $250k into the remodel, the return on that one was still good for a 4 year hold.
  • As part of my tracking, for kicks and a little history, I note when properties last sold.  A few interesting ones from the 1970’s popped up.  One selling in 1973 for $42,500 is currently listed for $1.659m and another selling in 1974 for $77,500 is listed for $2.195m.  The lower priced one went up 39 times its original value; by my calculation 3900% appreciation.
  • Figuring out the appreciation rate has been more of an educated guess than a science.  Year to year, the numbers showing up in comparing various homes range from 11 to 30 percent appreciation.  Realizing that’s a big spread, the ‘X’ factor takes into consideration what is in the market place from quarter to quarter, their location and condition.  A case in point, a grand West Portal home a block from the Avenue sold a year ago for $2.33m.  In the current quarter, an Inner Parkside house of 1960’s vintage and similar size sold for $2.425m.  Year over year, that appreciation rate is about 4%.  West Portal homes sell for more than Inner Parkside homes, as do older vintages, over more modern ones.  I think the real appreciation rate is more like 20-25% year to year, which is hard to show, since there isn’t anything matching last year’s home.  For those of us who have been around for a while, it wasn’t that long ago that sales prices going over $2m was astounding.
  • Making an educated guess, an 10-15% year to year appreciation for most homes is more realistic, and those with ‘Dwell Magazine’ level remodels seeing more aggressive pricing (that 25-30% number); as most people don’t want to deal with remodeling and will pay a premium.
  • What will happen next?  Hard to say.  With the Bay Area employment market and a restricted inventory, I think we are in good shape for the short term to keep our upward pressure on the market.

Eric Castongia, Broker Associate at Zephyr Real Estate (BRE Lic. No. 01188380) provided this information. The content of this article is an interpretation of data from the San Francisco Multiple Listing Service, the County Tax Record, the internet and Eric’s observations in the marketplace.  Eric can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.

The West Portal/Inner Parkside Real Estate Update

Second Quarter 2017 Market Update

By Eric Castongia, Zephyr Real Estate

2017 started a little slower than expected.  Historically, we start seeing buyers come back into the marketplace after the holidays, around February.  This year, we started seeing the first of the year bump around the end of March and it’s been going strong since.

For West Portal/Inner Parkside we saw:

  • In the first quarter of 2017, there were 10 sold properties, with eight receiving multiple offers and seven over asking.  The other three offers were at and below asking.  The amount of overbids ranged from as little as $80,000 to as much as $555,000-tied by two different sales.
  • In the second quarter of 2017, there were 19 sold properties, with 16 receiving multiple offers; all 19 offers sold over asking.  The amount of over bids ranged from as little as $101,000 to as much as $630,000.
  • In most cases, list prices have come down to get these huge overbids, largely to get numbers of people in the door; the more people that see it the better.  Warning to sellers though, buyers are savvy to market value and prices; they’ll only play if they can see a bargain; if you start too high on list price, you’ll be all alone on offer day.
  • Last year, I noted that less than perfect properties in the marketplace were not getting snapped up for big bucks with multiple offers, that’s changed.  Because of limited inventory, some buyers are being more flexible, accepting challenged properties and paying more for them.
  • As for sales reported as all cash (no loan); there was one (10%) reported in the first quarter and five in the second (26%), clearly indicating more aggressive bidding in the second quarter.
  • Interestingly, despite big overbids in the first quarter, prices actually went down as much as 11 percent from the end of 2016.  For the last few years, we have seen a tapering off of the number of bids, and the amount of traffic in open houses about mid year.  Summer vacations likely have something to do with that, but I think the bigger issue is buyer fatigue.  There are only so many times you can write an offer, get beat and then get up again for more.  Buyers, from July through the end of the year may be a good time for you to stay in the game.
  • The second quarter was more aggressive; all that was lost in the past six months came back.  Comparing year-to-year values, we were back up between seven and 20 percent.  The large range correlates to differing property types; the typical Sunset style homes with two bedrooms up and a room and bath down behind the garage saw the greatest appreciation-they are generally the most available and affordable to price sensitive buyers.
  • I like to watch for ‘apples’, or properties that have sold recently and are now being resold.  When that occurs for a job or relocation change-it is a good barometer for market changes.  The most recent ones have all been fixer properties that have been remodeled and then flipped.  They are fun to watch, but in this case, it doesn’t give us an idea as to market condition.
  • Is a market change coming?  Yes, but not yet.  There is still a lot of money and interest rates are low. Even when that does happen, the prime hub of West Portal Inner Parkside will continue to be popular with a smaller correction, while areas with less desirable locations, will see larger changes.

Eric Castongia, Broker Associate at Zephyr Real Estate (BRE Lic. No. 01188380) provided this information. The content of this article is an interpretation of data from the San Francisco Multiple Listing Service, the County Tax Record, the internet and Eric’s observations in the marketplace.  Eric can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.

The West Portal/Inner Parkside 2016 Annual State of the Neighborhood

Year-End Real Estate Market Update

By Eric Castongia, Zephyr Real Estate

2016 started strong as expected.  New buyers came into the marketplace, met with a constricted inventory, and generated competition, multiple offers and overbids.  By the third quarter, the activity waned, as it has for the last two years.  The lack of a second bounce after Labor Day created a flattening for the balance of the year.  We continued to see multiple offers and overbids during that time, but there were not a sure thing, with the numbers of offers and the amount of overbids coming down.  For West Portal/Inner Parkside we saw:

  • The total number of sales for 2016 was 46, up from 42 in 2015.  The normal has historically been around 50 annual sales.
  • In the last quarter of 2016, there were 13 sold properties, with 9 receiving multiple offers over asking.  The amount of over bids ranged from as little as $2,000 to as much as $304,000.  I find two significant data points in here; the number of overbids verses sales is down, as is the amount of the overbids.
  • Of the 19 transactions in the last quarter, which included pending, sold and failed to sell properties, the failed to sell category is up to four.  When a property doesn’t sell (withdrawn from the market, expired, or temporarily taken off the market) it most generally means the property was priced too high or had some issue that a buyer was not willing to take on at the price offered.  It is unusual to see nearly all of this category in one quarter; in this case, I believe that reinforces a change, since there were five such properties for the whole year.
  • For 2015, 36 of the 42 sales were multiple offers, and 39 were over asking; that’s 93% of the sales being more than asking price.  For 2016, 38 of the 46 sales were multiple offers and 40 were over asking; that’s 87% of the sales being more than asking, which is still a  healthy market. Interestingly, the reduction in multiple and over asking offers was in the last quarter of the year.  Note how this corresponds with the increase in the number of failed to sell properties.
  • As for sales reported as all cash (no loan); we had a total of seven for the year (15%)-in 2015, there were 11 (26%).  It looks like fewer people needed to pay cash to be competitive.  It’s important to note that contingencies are back too-another indicator that buyers are feeling like they will buy on their own terms.
  • Year to year, prices stayed even in the West Portal/Inner Parkside core; the  flattening/retreat in the summer and fall, brought us back to the previous year’s values.
  • I found a comparison North of Ulloa indicating prices could up as much as four percent, but given the lack of inventory and comparisons, that could be reflective of one special property and situation.
  • The number of two bedroom, one bathroom homes (and smaller homes) are shrinking, as more downstairs rooms are built out and larger homes are more the norm.
  • There are more large, super-done homes (think Dwell Magazine) selling for a premium.  I remember one such home in 2015 that sold for $2.3m, which at the time was astounding.  Now, we’re seeing $2.4m to $2.6m for such homes.  The premium for super-done homes is reflective of buyers having more dollars than time or expertise to handle remodeling.
  • I would suggest that the changes we have seen in the market are a result of many buyers being priced out of the market.  As buyers are tire of losing out on homes, they are looking to other more affordable neighborhoods, including moving out of San Francisco.
  • It’s early to tell (or feel) what will happen in 2017.  If history has anything to do with it, I expect we will see the same bump in property value at the beginning of 2017, mainly as a result of renewed activity.  Perhaps we will gain what was lost toward the end of the year, although it could be slower ascent.  By March, we should have a clearer picture as buyers come out of the woodwork post holidays and show us what they are thinking.

Eric Castongia, Broker Associate at Zephyr Real Estate (BRE Lic. No. 01188380) provided this information. The content of this article is an interpretation of data from the San Francisco Multiple Listing Service, the County Tax Record, the internet and Eric’s observations in the marketplace.  Eric can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.

The West Portal/Inner Parkside Third Quarter 2016 Real Estate Market Update

By Eric Castongia, Zephyr Real Estate

Ask a property owner what’s happening in the market and they think it’s gangbusters; ask a buyer and they think it’s changing in their favor.  Both opinions have some truth to them, which makes it really hard to give a straight answer when someone asks what’s happening.

There was a spike citywide for listings in September.  As a quick diagnostic, I measure the market by how many pages of listings we have on Brokers Tuesday; during the most constricted time in the market, it was 15, after Labor Day it was 27.  That means inventory nearly doubled across the city in the matter of a few weeks.  It makes it confusing for buyers, as they have more to see and consider.  The type and condition of those listings varies greatly, but it is taking buyers longer to see everything in the marketplace to make a decision.  The most desirable and well-priced properties are still selling quickly and over asking, others that are not getting buyers’ attention are lingering.  The perception of the market changes fast and strategies need to be quickly re-evaluated.  Dissecting the numbers:

  • At the close of the third quarter of 2016, we had five active and nine sold (closed) properties. Of the nine sold, all received multiple offers, over asking. 
  • On average, the number of offers received on each property has come down across the board.
  • The bids ranged from $55,000 to $300,000 over asking (down from a high last quarter of $580,000).
  • One of the nine sales (11%) was reported as all cash (no loan), last year at this time, it was three of nine (33%).  Fewer people need to pay cash to be competitive.
  • Two of the five active listings have been on the market for 30 days or more, which is very unusual.  The other three came on in September; West Portal/Inner Parkside, while in demand, is not immune to market changes.
  • Marketing remains all about getting a buyers attention. Given the number of active listings in the marketplace, it seems clear that most often the strategy remains under-price to generate attention. 
  • Seller expectations must change; listing and selling prices may not be what they expect/want, or what they were six months ago.
  • For the last 10 years, the average number of sales in the third quarter has been between 13 and 15, with the exceptions; 2007 & 08, and 2015 & 16, (between nine and 11).  Last quarter I interpreted the exceptions as indicators of market changes.  Interestingly, the 13-15 ‘normal’ range ran throughout the recession between 2009 through 2012, with the most recent exceptions in 2015 and 2016-these years did not have an expected post-Labor Day bump, which hampered activity, combined with two listings that have lingered on the market.
  • Comparing the third quarters of 2015 and 2016, property values stayed even.  This was true of all ranges compared, including those above $2 million.
  • The most recent ‘apple’ on the market sold in 2014 for $1,354,000 and recently sold for $1,600,000 (a 15% increase in two years).  Given the lack of appreciation in the last year, that means the 15% appreciation was in the first year of ownership.

Is a change coming?  Yes, it always does.  Changes come and go, but the last one was pretty brutal and no one knows if we will go there again or not.  The ‘slow down’, for what it currently is seems more about sellers catching up to perceptions of market value; that things aren’t quite as hot as they were, and a lack of motivation on the part of buyers; thinking that the market will come down and they will have more affordable options.  For those sellers who have to sell, they have to be more flexible, for those that don’t, wait to sell until the next bump in activity.  When all is said and done, West Portal/Inner Parkside seems to move to its own, nimble drum beat, expanding and contracting to keep the supply and demand in check.

Eric Castongia, Broker Associate at Zephyr Real Estate (BRE Lic. No. 01188380) provided this information. The content of this article is an interpretation of data from the San Francisco Multiple Listing Service, the County Tax Record, the internet and Eric’s observations in the marketplace.  Eric can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.

The West Portal/Inner Parkside Second Quarter 2016 Real Estate Market Update

By Eric Castongia, Zephyr Real Estate

The market has been changing, slowly enough that it has been more a question than a clear statement.  In looking back, it started at the end of last summer with less than perfect properties in the marketplace not getting snapped up for big bucks with multiple offers.  Buyers are more selective, price range is more important than location and a current remodel is more important than a large home. Properties that fall outside those parameters are most susceptible to negotiation, particularly if they are priced inappropriately to start with.  Here is what happened in the neighborhood for the past quarter:

  • At the close of the second quarter of 2016, we had one active and 18 sold (closed) properties.
  • Of the 18 sold, 17 sold over their asking price, 15 received multiple offers (two of the 18 sold off market, so they received one offer).
  • The bids ranged from $32,000 to $580,000 over asking; one property sold under asking.
  • If we dig deeper, we would find that the number of offers have come down across the board, and to make sure buyers come in the door, list prices have come down.  With that, overbid amounts have gone up giving the illusion that prices have gone up significantly, when in actuality, they may not have.
  • For the last 10 years, the number of sales in the second quarter have been between 10 and 14, except for the three years; 1) 2016, 2) 2008, 16 (toward the beginning of the economic downturn), and 3) 2010, 21 (before the start of the economic recovery, when some had to sell).  Interpreting this, I think sellers want to cash in on what they may believe is the height of the market.
  • Two of the 18 sales (11%), were reported as all cash (no loan).  In the second quarter of 2015, it was 42%.  This means to me that fewer people need to pay cash to be competitive-sellers and listing agents have to be a little more flexible.
  • The most recent ‘apple’ on the market sold last year for $1,025,000 and recently sold for $1,140,000 (an 11% increase year over year).
  • Comparing the second quarters of 2015 and 2016, we saw as much as a 8% increase, while year to year, we saw 3-10%, with one anomaly at 30%.
  • Fewer buyers can purchase higher end properties, so values at that level are not escalating at the same rate.  The breaking point seems to be around $1.8 million; year to year, those values and above are essentially flat.  For example, a home that sold recently in West Portal for $2.2 million, sold for about the same amount as a similar home last year.  Conversely a house worth $1.3 million last year, might be worth $1.4 million now because it is in a more affordable price range.
  • As the affordable price range continues to shrink, price sensitive buyers are going further and further out; case in point, remodeled homes in the outer sunset are selling over $1.3 million. 
  • Is a real change coming?  I think yes, but hard to say when and what that means. Looking at history, my guess is that the prime hub of West Portal Inner Parkside will continue to be popular with a smaller correction, while areas with less desirable locations, will see larger changes.
  • Not long ago, West Portal and Inner Parkside were considered affordable; I guess it really is the next Noe Valley.

Eric Castongia, Broker Associate at Zephyr Real Estate (BRE Lic. No. 01188380) provided this information. The content of this article is an interpretation of data from the San Francisco Multiple Listing Service, the County Tax Record, the internet and Eric’s observations in the marketplace.  Eric can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.

The West Portal/Inner Parkside First Quarter 2016 Real Estate Market Update

By Eric Castongia, Zephyr Real Estate

As I wrote this article, I was thinking how to make sense of a schizophrenic market. How can I accurately convey the lack of the typical bump in the marketplace at the beginning of the year, which affects both inventory and prices.  How some properties are selling like gangbusters and others aren’t.  How the Outer Sunset and Parkside (and Excelsior and Crocker Amazon) are almost literally on fire with the explosion in prices.  How the upper end (those properties over $2.5 million or so) has slowed and how many options there are.

As I write this, it becomes more clear that it has more to do with price point than location.  Crazy as it sounds, you can only expect so much under $1.5 million, so areas that have historically been lower in price have become the very last place buyers can buy and stay within city limits.

West Portal and Inner Parkside have had an inventory problem ever since they got ‘found’.  I’ve heard it called the next Noe Valley and I think that’s accurate.  The ease of access, transport and vibrant commercial core are all part of its desirability.  When something doesn’t get sold, it’s overpriced; people want the neighborhood and they are willing to buy a quirky house if they have to, to do it.  In essence, it has it’s own market within the larger San Francisco market. 

  • At the close of the first quarter of 2016, we had two active, three pending and six sold (closed).
  • Of the six sold, five received multiple offers and five sold over their asking price.  Note the sixth sale was an off market sale that sold at asking; if that had been on the market, chances are it would have seen multiple and over asking offers as well. 
  • The amount of over bids ranged from $102,000 to $335,000 over asking.
  • The number of sales at the end of the first quarter 2015 was eight compared to 2016, which was six.  I looked back at history trying to make some sense of the numbers to see if it was as expected or not.  Generally, there were more sales in ‘hotter’ years and lower numbers in slower years.  Interestingly, a slower year would have been 4-6 sales and a ‘hotter’ year would have been 12-15.  In this case, I think it has more to do with a lack of inventory, than a slowing of the market.
  • Two of the six sales (33%), were reported as all cash (no loan).
  • I have noted buyers have become more picky; if they are going to overbid, they want as many of their checkboxes ticked as they can-the net affect is that some listings are getting only one or two offers and not selling quite where they were expected to.
  • The best ‘apple’ on the market in the last quarter previously sold in June of 2015 for $1,450,000 and recently sold for $1,525,000 (a 5% increase over nine months).
  • In my analysis to determine market value, I do not use median price.  Rather, I compare specific property types, sizes, conditions and locations, from quarter to quarter and year to year.
  • From the fourth quarter 2015 to the first quarter of 2016, prices stayed even in West Portal/Inner Parkside core.  I think this could be an indication of the ‘lack of bump’ at the beginning of the year-which actually started after Labor Day.
  • Comparing the first quarters of 2015 and 2016, we saw a 15% increase; note that that increase was only measured on the North Side of Ulloa, as the inventory the West Portal/Inner Parkside core was so limited over the past year, so there wasn’t much to compare.
  • Fewer buyers are able to afford West Portal, instead, pushing out further in the Avenues and points south.

Eric Castongia, Broker Associate at Zephyr Real Estate (BRE Lic. No. 01188380) provided this information. The content of this article is an interpretation of data from the San Francisco Multiple Listing Service, the County Tax Record, the internet and Eric’s observations in the marketplace.  Eric can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.

The West Portal/Inner Parkside 2015 Year-End Real Estate Market Update

By Eric Castongia, Zephyr Real Estate

2015 started out strong and I expect we will see that again in 2016 as a result of a continued lack of inventory and a flood of buyers coming back into the marketplace after the holidays. Although we had multiple and over asking offers throughout the year, the most aggressive and largest number of bidders occurred mainly before summer; looking back at 2015, I think our high point was July.  Buyers tired out faster this year than they did in 2014.  So 2015 only had one market bump; not the usual two.

After Labor Day, buyers were more fickle, largely because in other parts of the city, inventory jumped dramatically (mostly condominiums) and all of a sudden, buyers had options; sellers trying to get top dollar couldn’t get quite what they had planned.  Properties that were already remodeled sold first, and list prices had to come down to get people in the door. Interestingly, at the end of the year, with most properties that didn’t sell going off the market til after the first, those that did come on, sold quickly at high prices.  It’s all about supply and demand.

  • Single family homes in a constrained market kept West Portal/Inner Parkside humming.
  • The total number of sales for 2015 was 42, a big decrease from 60 in 2014 and 64 in 2013.  In the old days (three years ago), the normal had been around 50 annual sales, so 2013 and 2014 were already higher than normal.
  • At the close of the fourth quarter of 2015, we had one active, 13 sold (closed) (18 at the same time in 2014) and no failed to sell properties.  Of the 13 sold, 11 received multiple offers and 12 sold over their asking price.  The amount of over bids ranged from as little as $10,000 to as much as $430,000.
  • Two of the 13 sales (15%), were reported as all cash (no loan); and we had 11 reported for the year (26%).
  • There were no short sales or bank owned properties on the market this year, although a few properties were in difficulties.
  • The best ‘apple’ on the market in the last quarter previously sold in 2005 for $900,000 and recently sold for $1.5m (a 67% increase).  Also, a fixer that sold a year ago for $1.1m, that was gutted and beautifully remodeled, just sold for $2.325m.
  • Of note, five of the 13 sales (38%) had been owned by the same people for more than 20 years.  Longer ownership means less movement and further tightening of the market; only those who have to sell, are.
  • Forgive me a little human interest.  Digging around the tax record means you can find the most interesting things.  One property that went quietly to foreclosure was most likely purchased on the courthouse steps and is now being resold.  Another home was owned for many years by a World War II veteran, who took advantage of the GI Bill to buy his home.
  • In my analysis to determine market value, I do not use median price.  Rather, I compare specific property types, sizes, conditions and locations, from quarter to quarter and year to year.
  • From the third quarter to the fourth, prices stayed even in West Portal/Inner Parkside core and went down as much as three percent North of Ulloa.
  • Year to year, homes that were either remodeled, or needed only cosmetics, went up in value between six and 15%.  The upper end of that range seemed to be for less expensive properties, as the market is more competitive in lower price ranges.  For properties on busy streets, or needed heavy remodeling, prices went down between seven and 12 percent.
  • Staging companies are telling me that they are booking up at the beginning of the year.
  • I expect the usual first quarter bump up in prices in 2016.  Inventory dried up over the holidays and buyers will be back after their holiday nap.

Eric Castongia, Broker Associate at Zephyr Real Estate (BRE Lic. No. 01188380) provided this information. The content of this article is an interpretation of data from the San Francisco Multiple Listing Service, the County Tax Record, the internet and Eric’s observations in the marketplace.  Eric can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.

The West Portal/Inner Parkside Third Quarter 2015 Real Estate Market Update

By Eric Castongia, Zephyr Real Estate

Half the real estate community thinks the market is still roaring, the other half think something is brewing.  Given the number of listings we saw come on across the city after Labor Day, some sellers feel something coming too.  You will soon see that West Portal/Inner Parkside has not been impacted by this as of yet.

We started seeing isolated instances of no offers on properties citywide at the end of the second quarter and that has lingered throughout the third quarter as well. 

On the most premium of properties, the number of potential buyers bidding on a property generally remained high, while those properties with a negative ding or two may have received multiple, but fewer offers; overall prices stayed up.  The problem for the isolated cases where no offers were received, seemed mainly to be a case where there was an issue that was difficult to resolve, was priced too aggressively, or buyers had choices of multiple properties.  As for us:

  • At the close of the second quarter of 2015, we had no active listings, seven pending, nine sold and two that failed to sell.  Of the nine sold, seven received multiple offers and all nine sold over their asking price.  In cases where an offer was over asking, but there was one offer, may indicate a ‘pre-emptive’ offer, which means an early offer before an anticipated offer date.
  • The amount of overbids ranged, from as little as $110,000 to as much as $505,000.
  • Comparing the same quarter of multiple years indicated that we are below the expected target for the average number of sales.  I went back as far as 2005 and in the third quarter, we have typically had 13 or 14 sales.  Our high in 2014 was 17 and right after the financial melt down in 2007 and 2008, we had 10 and 11 sales respectively in the third quarter.  Interesting that we have fewer sales than in the depths of the financial melt down.  That, I suspect, is largely why we have not seen pauses in the market yet.
  • Of the nine sales, five were reported as all cash (no loan on the property).
  • Looking at average appreciation from the second to the thirds quarters, I estimate an increase between four and eight percent; looking at year to year appreciation, it is closer to 20 percent.
  • Once again, West Portal and Inner Parkside are in their own bubble within a bubble.
  • A word of caution before listing your property, look at comparable sales and trends to establish a price in line with the marketplace and take citywide competition into consideration. Once we start seeing price reductions and withdrawn properties being more common place, that is the start of a market change.

Eric Castongia, Broker Associate at Zephyr Real Estate (BRE Lic. No. 01188380) provided the information in this article. The content of this article is an interpretation of data from the San Francisco Multiple Listing Service and Eric’s observations in the marketplace; he is available to discuss your situation or any questions you may have.  He can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.