By Eric Castongia, Zephyr Real Estate
2015 started out with a bang. We see it almost every year because of a burst of post holiday energy; it’s amplified because buyers are in competition to buy the same properties.
To give you a quick visual, I did a search for active single family homes for all of districts two and four, which cover all of the Sunset and from West Portal through to Sunnyside. There is a total of 40 homes for sale in all price ranges. That’s an incredibly small number.
Most of the inventory I have been seeing has been from people moving out of town, or passing on. There aren’t many move up buyers (who are also sellers) and I think this is a significant root of the problem to our lack of inventory. Faced with the need to sell their current property first and move into a rental while they look for a home is a daunting thought in a market short of inventory, with prices going up, competition and the need to get financing, that’s a pretty big leap of faith. Most people give up on the thought.
As for market specifics in West Portal/Inner Parkside:
- At the close of the first quarter of 2015, we had one active, four pending and eight sold. Of the eight sold, all eight received multiple offers and sold over their asking price. The amount of the overbids are a big range, from as little as $66,000 to as much as $375,000. There is no rhyme or reason to the amount of an overbid; it is dependent on the list price and the amount of interest in the property.
- Eight sales in the first quarter seemed very low to me, so I went back ten years to see if I could find a trend. About half the time, the first quarter has been below 10 sales, the rest has been over; given the historical data, eight seems reasonable to expect.
- Of the eight sales, only one was reported as all cash (meaning no loan on the property); compare that to the first quarter of 2014, where five of the 15 sales reported all cash. I am hearing of more transactions with financing, so perhaps cash is saved for only the most in demand properties.
- A few interesting ‘apples’ on the market in the last quarter, meaning properties that have sold in the recent past. One on Ulloa that sold in 2004, sold for $800,000 more in 2015 and another on 18th Ave. No of Ulloa that sold in 2013 for $633,000, benefited from a significant makeover and sold for over $1.5 million in 2015.
- For typical West Portal/Inner Parkside homes, which have two bedrooms and a bath up and rooms down, I didn’t see fluctuation in prices from quarter to quarter. Part of that was hampered by the specific inventory we had to compare.
- North of Ulloa usually gives us a better sample, because there are more sales in that area over the course of a year. From the end of 2014 to the beginning of 2015, appreciation was about five percent, and year over year it was about 16 percent.
- List prices have stayed the same or gone down a bit, leaving some room for buyers who expect to overbid.
Eric Castongia, Residential Sales Specialist 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. Eric can be reached by e-mail at Eric@SFHotBuy.com, or via mobile phone at (415)307-1700.