The West Portal/Inner Parkside Real Estate Market Update 3rd Quarter 2012
As I have previously reported, the real estate market has been accelerated since the beginning of the year. Low interest rates and even lower inventory have created upward pressure on real estate values. Buyers are feeling confident that we have passed the bottom of the market and they are now being moved to take advantage of low interest rates.
The following market analysis covers both Inner Parkside and West Portal. Although the San Francisco Multiple Listing Service identifies these as two districts, I see them as three neighborhoods, with Inner Parkside split into two pieces (South of Ulloa and North of Ulloa).
For the third quarter, we had 14 sold listings, keeping in line with the expected sales numbers for this time of year.
Although we have the expected number of sales in the neighborhood, there are more buyers now than usual because: 1) buyers have been waiting on the side lines for the last few years and 2) buyers are getting pushed out of their preferred neighborhoods and finding ours.
Generally speaking, there has always been demand for good homes in preferred locations within the neighborhood, no matter the market. The difference is that everything is selling if it is priced within neighborhood expectation. So, we have moved from buyers being very selective, to being more flexible in what they are buying.
Of the 14 sold properties, 10 received multiple offers and 12 of them sold over their asking price. The amount of over bids ranged from as little as $1,000 to as much as $146,000.
In general, I note higher over bids on lower priced property, while more expensive properties seem to be getting smaller over bids. I would expect there to be the same pressure throughout the market, but this seems to indicate that the entry price range is driving the market; probably through a fear of missing their window to buy at all.
Only one of the third quarter’s 14 sold properties had a price reduction compared to same quarter in 2011, which had five.
Two of the 14 sold properties were a short sale or foreclosure. In the second quarter we had none. There are several short sale or foreclosure properties that are either active or pending right now that will probably close in the fourth quarter.
It is interesting to note that seven of the 14 homes had no previous recorded sales history in the multiple listing service. This means that longtime owners had lived in the properties and had not traded hands for years. Further proof that only those people who need to sell or have a place to go are selling.
It can pretty clearly be called that the market has gone up 10 percent since last year at this time. Notably, most of our increase in values occurred in February and March of this year and have been continuing on their creep up ever since.
The same rules apply now as before; if it doesn’t sell within the first two weeks, sellers need to consider a price reduction to keep the marketing momentum going. The good news is that it is still possible to generate multiple offers and an over asking offer; buyers have to see your listing as a bargain and once they do, they will make a move on it.
The week after Labor Day, we had a number of new listings on the market citywide and I thought we would finally see the increase in inventory that we have been waiting for to slow prices down. The next week, however, there was very little on the market, so it seems that the shortage of inventory will continue until those owners who are still underwater can get out.
Eric Castongia, Residential Sales Specialist (DRE No. 01188380) at Zephyr Real Estate 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.