SAN FRANCISCO & MARIN REAL ESTATE MARKETS
How's the market? When buying or selling a home in San Francisco or Marin, it's important to know what's going on in the current, local real estate market to make informed, smart buying and selling decisions. Experience shows, it all depends on where you live or wish to buy. Find Market Reports and Market Updates below, or request additional current market information.
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MAY 2013
The Bay Area’s real estate market continues to post strong gains, with prices rising during the month of May (year-over-year). Buyers continue to outnumber sellers in the marketplace and interest rates remain attractive, helping to push prices higher and quicken the pace of home sales. We are also seeing more homes sell above asking price. In all seven counties, homes (as well as condominiums in San Francisco) that did not require a price change sold 6.75 percent higher than list on average, a reverse from May 2012 when that same group of homes sold at asking price in every county except San Francisco.
San Francisco - The city’s strengthening market for single-family homes carried on throughout May, as the average sales price rose 15 percent from the previous month and jumped 37 percent from May 2012. A shortage of inventory remains a significant factor in the San Francisco market: The number of units sold remained relatively flat, while days on market fell 30 percent from the prior year with homes spending an average of 31 days on market. Buyers are bidding up inventory where it’s available and doing so quickly. Homes that sold without a price change went for an average of 13 percent above asking price in May. The San Francisco condominium market also remained strong as the average sales price rose 21 percent to $1.02 million in May, versus $841,186 in May 2012. The number of days on market dropped nearly 30 percent falling to 36 days. However, the number of units sold was up 31 percent from the previous year for a total of 284.
Marin - Home prices in Marin gained significantly, increasing 16 percent to $1,033,295 in May compared with the same month a year earlier. The number of homes sold was up 24 percent not only from the previous month but also the previous year. Echoing the trend seen across the Bay Area, days on market dropped over 35 percent from the previous year. The Kentfield market saw particular appreciation with the average home price climbing to $2.9 million in May, a gain of 51 percent. Prices cooled slightly in the affluent neighborhoods of Ross (-58%) and Belvedere (-38%). Yet due to the low number of transactions in these areas, some percentages can be misleading and tend not to be statistically significant.
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APRIL 2013
The Bay Area’s real estate market continues to post strong gains, with prices rising during the month of April (year-over-year) in San Francisco and Marin counties. Buyers continue to outnumber sellers in the market and interest rates are attractive, helping to push prices higher and quicken the pace of home sales. We are also seeing more homes sell above asking price. Homes (as well as condominiums in San Francisco) that did not require a price change sold above asking price, a significant reversal from April 2012 when that same group of homes sold at or below asking price in every county except San Francisco. Some of the greatest gains came from the condominium market in San Francisco, where the average sales price jumped 35 percent from the previous year, to $1,031,572 in April 2013.
San Francisco - The market for single-family homes in the city remained strong in April with the average sales price holding steady at $1.37 million—a zero percent change from the previous month—but jumping 29 percent from April 2012. A shortage of inventory remains a significant factor in the San Francisco market: The number of units sold and days on market were both down from the year before. Buyers are bidding up inventory where it is available. Homes that sold without a price change went for an average of 14 percent above asking price last month. The competitive marketplace continues to influence buyers to make quicker decisions. April saw a 42 percent decline in days on market, dropping to just 31 days from the previous year. The San Francisco condominium market was exceptionally strong as the average sales price rose 35 percent to $1.03 million in April, versus $761,500 in April 2012. The number of days on market dropped nearly 50 percent falling to 37 days. The number of units sold saw a slight decrease from the previous year.
Marin - Home prices in Marin gained significantly, increasing 16 percent to $1,033,295 in April compared with the same month a year earlier. The number of homes sold was virtually flat year-over-year; however in April that number rose by 17 percent in just one month from March. Again, days on market dropped over 30 percent from the previous year and month, echoing a trend seen across the Bay Area. The Belvedere market saw particular appreciation with the average home price climbing to $2.98 million in April, a gain of 26 percent. Prices cooled slightly in the popular neighborhoods of Kentfield and Ross.
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APRIL 2013
Real Estate Market Reports, First Quarter 2013:
- Luxury Trends - San Francisco Bay Area luxury real estate; view market trends and discover the Bay Areas most expensive neighborhoods.
- San Francisco County - View trends for San Francisco homes and condos, price per square foot, the hottest neighborhoods, and more.
- Marin County - View the latest market trends for Marin County homes; from days on the market to average sales price.
- Regional Trends - The big picture view of recent real estate trends for the San Francisco Bay Area.
The Bay Area’s housing market during the first quarter could best be described as hyperactive and intensely competitive as high demand and low supply once again drove up prices. Inventory is at 20 year lows in some areas of the county, according to Steve Murray of Real Trends, and the Bay Area is no exception. After years of sitting on the sidelines, buyers are back, feeling confident that the real estate market is once again golden. The low inventory and abundance of buyers has led to an unbalanced market, tipped solidly in favor of sellers.
What does this mean? It means that prices are rising, homes are selling faster and we’re seeing multiple and, in some cases an increasing number of, all-cash offers. Across the eight Bay Area counties in which we are active, we saw the average price of a single family home jump 29 percent to $664,187 compared with the same period a year earlier. With little supply, buyers are being forced to act fast. The average number of days on market declined to 45 across the eight markets, a drop of 32 percent from the first quarter 2012. Although prices have returned to pre-2007 levels, volume has not as the rising prices are not enough to draw sellers into the market.
Another significant trend that we saw was a significant uptick in all-cash offers. During the first quarter 35 percent of McGuire transactions were all-cash. In some areas that number was much greater – cash deals accounted for half of all transactions in Marin County first quarter, for example. In many cases, buyers are paying in cash to make their offer more attractive to sellers. These buyers are then turning around after the deal closes and financing their homes.
Finally, we are beginning to see interest rates climb. Freddie Mac data shows the average 30-year fixed loan rate was 3.63 percent in early April, the highest in more than six months. Experts say this is not necessarily bad news for the housing market in a recent Fortune magazine article. First, it’s a sign of that the U.S. economy is strengthening, which is clearly good news for the housing market. Second, it may spur even more buyers into action as they hurry to buy before rates rise more significantly.
The busiest season of the year for real estate is now upon us and we have not seen any significant increase in listings. I expect the low levels of inventory will continue to drive prices upward, at least in the short-term. Looking to the second half of the year, I expect much of the same as low supply continues to drive a sellers’ market. In order to return to a more normalized market, we must see a balance of power between buyers and sellers, which won’t happen until supply and demand are on more equal footing. Ultimately, the key to a healthy, sustainable real estate market is job creation. While we feel “blessed” for our local market successes, we can really only feel confident when U.S. wealth production per capita expands.
JANUARY 2013
Real Estate Market Reports, Fourth Quarter 2012:
- Luxury Trends - San Francisco Bay Area luxury real estate; view market trends and discover the Bay Areas most expensive neighborhoods.
- San Francisco County - View trends for San Francisco homes and condos, price per square foot, the hottest neighborhoods, and more.
- Marin County - View the latest market trends for Marin County homes; from days on the market to average sales price.
- Regional Trends - The big picture view of recent real estate trends for the San Francisco Bay Area.
As we wrapped up last year, the fourth quarter numbers came in strong. Prices rose in each of the “McGuire” markets: Berkeley, Burlingame, Southern Marin and, of course San Francisco, which led the way. The average price of a single family home in San Francisco climbed 32 percent to $1.29 million in the fourth quarter from the fourth quarter 2011. At the same time, the pace of sales was brisk in San Francisco and throughout the Bay Area. The region’s housing market is as bright and as active as it has been any time over the past five years. During a recent interview at the World Economic Forum in Davos, Switzerland the Yale economist Robert Shiller said that short-term indicators point to an improving market. “It’s a good housing market in the sense that mortgage rates are very low and prices have come down to normal levels,” he said an television interview with Bloomberg News from Davos.
Still, it is important to understand the reason we saw not just gains, but gains of such substantial magnitude: We are facing a crisis of inventory. Around the Bay Area, buyers outnumber sellers and the prices of high-quality properties are being driven up by multiple offers. It’s basic economics – any time you want to control prices, limit supply. Yet the gains that we’ve seen are very real and, in some cases, are starting to approach the high water mark that was set in 2006-2007. As sellers who have remained on the sidelines concerned that they would have to sell their homes for less than they paid begin to take note of this, I believe we will see more homes come on the market. Additional supply should lessen pressure on prices, tempering gains.
As I look ahead to 2013, what do I expect? In the Davos interview, Robert Shiller qualified his remarks about the positive short-term indicators, noting, “It’s a good time to buy if nothing bad happens.” Indeed, I am keeping my eye on a couple of wildcards. As the politicians in Washington struggle with the debt ceiling crisis, it creates uncertainty in the marketplace, which can lead to inactivity as buyers and sellers remain frozen in wait-and-see mode. Furthermore, some proposals in Washington call for eliminating the mortgage tax credit, creating further uncertainty for the housing market. Finally, a new 3.8 percent capital gains tax associated with healthcare reform that went into effect this year could affect some sellers at the high end of the housing market.
As we begin this new year, I am optimistic. Prices are rising and we are seeing a market that is a stronger than it has been in a long time. Inventory crisis or not, the trends are encouraging and I expect that we will continue to see an active, healthy market in 2013.
NOVEMBER 2012
Real Estate Market Reports, Third Quarter 2012:
- Luxury Trends - San Francisco Bay Area luxury real estate; view market trends and discover the Bay Areas most expensive neighborhoods.
- San Francisco County - View trends for San Francisco homes and condos, price per square foot, the hottest neighborhoods, and more.
- Marin County - View the latest market trends for Marin County homes; from days on the market to average sales price.
- Regional Trends - The big picture view of recent real estate trends for the San Francisco Bay Area.
Around the Bay Area, prices were up in the third quarter, the pace of sales quickened and volume increased. This is, without question, good news. The worst of this down cycle is behind us and prices are beginning to rise again. This mirrors an overall economic trend: The Conference Board’s Consumer Confidence Index rose to 72.2 in October, its highest level since 2008. However, while I expect to see continued stable and steady growth, I also expect that growth to be slow. The recovery that we’re seeing is fragile and is destined to take much longer than what we’ve seen in past cycles. Whereas real estate has led us out of past recessions, this time a sustainable real estate recovery will follow private sector job creation.
One particular trend that we’ve seen in each of the Bay Area markets this quarter is a shortage of inventory. There are more buyers than sellers in the marketplace right now and this is a major driver of the price increases we’re seeing across all our markets: San Francisco, the Peninsula, the North Bay and the East Bay. So what is limiting our supply? Although home prices have risen from the lows of the last couple of years, they remain well below the high water mark set in 2006-2007. Many discretionary sellers are unwilling to consider putting their homes on the market when they know they are going to get significantly less than they would have five years ago and, in some cases, less than they paid. This is limiting supply and creating an imbalance between buyers and sellers that is driving up home prices.
Another significant trend during the quarter is rising prices for luxury homes (the top 10 percent of homes) in the Peninsula and San Francisco markets. This is exactly what I’d expect as these markets have the strongest ties to the biotech and tech industries, the two industries that are fueling job growth in our region. Confidence in the tech industry is again on the rise. The University of San Francisco’s School of Management, which uses its Silicon Valley Venture Capitalist Confidence Index to assess the health of the region’s tech industry, found an increase in confidence in the third quarter. The index measured 3.53 out of 5 in the quarter, up from its low of 2.7 in 2008. The real estate market is also benefitting from strength in the biotech sector. Hiring at biotech companies in and around the industry’s South San Francisco hub has increased demand for Peninsula homes at all price points, driving up the average price of a single family home in San Mateo County 18 percent to $1.12 million compared with the third quarter 2011. San Francisco’s luxury home market also saw significant appreciation in the quarter, particularly in the city’s southernmost neighborhoods from which the commute to Silicon Valley is the easiest.
As we look toward the end of 2012, I am optimistic that we are on our way toward a recovery. Prices are again rising and the worst is in the past. Yet as we begin climbing out of this down cycle, it is important to remember that it just as took many years of frenzied bidding and bad habits to push the market to the record high, it is going to take some time to recover from the subsequent lows.
APRIL 2012
Generally speaking, the real estate market this March/April is showing lots of home buyer activity in Marin with multiple offers being made on the prized, well priced homes. A severe lack of inventory is the biggest challenge, as there is far more demand than supply.
In San Francisco, homes of all types (even fixers, stale listings, probates) are receiving multiple offers, with one winner and 6-10 buyers out of luck. Home affordability is terrific, and home buyers are doing everything they can to get the house they want to end the process. Despite it being a great time to list, sellers are not responding because some of them are stuck with no equity and don't have cash to move even if they want to.
OCTOBER 2011
Inventory shortages are hampering local markets, as autumn begins. With the traditionally quiet end-of-summer behind us, Bay Area realtors are geared up for what could be a busy fall selling season. However, one obstacle standing in the way of a solid market isn’t a lack of buyers – but a lack of inventory. There just aren’t enough good, well-priced homes for sale to meet buyer demand.
Considering the downbeat national housing market news coverage, you might think that more homes on the market is exactly what we don’t need at this time. But the Bay Area is different from much of the country. In many of the local San Francisco and Marin markets, buyers are continuing to snap up homes that are seen as good values. The result is that a number of listings are attracting multiple offers and many buyers are frustrated by lack of supply. Buyers, and agents, only wish there were more homes on the market.
My guess is that a lot of potential sellers are sitting on the sidelines waiting for a number of issues to sort themselves out, whether it’s the direction of the housing market or the volatile financial markets. While the housing market was quiet as we closed out summer, the stock market has been anything but. So where does this all leave us?
Despite the volatility of the financial markets we’re not seeing current buyers walking away. Given the global economic headwinds buffeting the financial markets, we’re likely to continue experiencing volatility for some time to come. Still, I think most home buyers in the Bay Area are looking past the week-to-week gyrations of the stock market and focusing on the long term. If anything, the recent dip in the stock market makes real estate all the more attractive as a long-term investment option.
On the seller’s side, my sense is that we’ll start seeing more people coming back into the market to list their homes, once they begin seeing the real demand that’s out there for well-priced properties. This is particularly true for those sellers who have lived in their homes for a number of years and, despite declines in prices in recent years, stand to walk away with significant gains when they sell.
One final note: As every Realtor knows, it can be hard enough to hold deals together in this turbulent market without added obstacles. But recent national reports say that mortgage financing and appraisal hurdles are increasingly knocking deals out of escrow and possibly holding back a housing market recovery.
Time magazine reported that 16 percent of all sales contracts failed in July because the buyers could not secure a mortgage, up from 4 percent just two months earlier. In other words, one out of every seven contracts is going down due to problems that buyers are having getting mortgages.
Difficulty in securing financing isn’t the only hurdle facing buyers right now. Low appraisals are also blocking sales, according to a recent article in the Wall Street Journal. According to the Journal’s reporters, real estate appraisers, who were criticized by some for being too generous in their property valuations before the housing market fell, may be going overboard in the other direction.
San Francisco:
New listings are coming to market, and they are being sold quickly. Price and location seem to be the recipe for a quick sale. There is a tremendous amount of interest and activity out there overall, however it appears buyers are watching for the price to be reduced if it is set too high. We are seeing an increase in all cash offers, trumping other good offers in multiple offer situations.
Marin:
More luxury properties are coming on the market, and selling at discount rates. Things are moving at a good clip, but still there is low inventory - the lowest in years. Yet, the market is outpacing last year in terms of the number of sales (indications of a pretty solid market). In Southern Marin, people seem to have come back from summer and are stepping up to the plate writing offers. Inventory is the challenge; they are not getting as many homes on the market as they’d like. The percentage of equity sales to distressed sales is rising.
JUNE 2, 2011
Market Focus Report June 2011/ San Francisco Association of Realtors. San Francisco specific report includes median sales price, active homes for sale inventory, and average days on market data.
It was a busy week for economic news, much of it encouraging. Perhaps the most positive data came out on Friday, showing that U.S. consumers grew more confident in May than a month earlier as declining gasoline prices helped lift Americans’ spirits. The upward trend is encouraging for those of us in the housing market.
As real estate people know all too well, consumer confidence plays a critical role in the housing market. If buyers are positive about their job prospects and the overall economy, they’re more likely to take the leap into buying a home or trading up to a larger one.
But despite the overall improvement in the economy and the financial markets, the nation’s housing market overall continues to struggle to gain momentum. Pending sales of existing U.S. homes dropped more than expected in April to touch a seven-month low, the National Association of Realtors reported on Friday.
NAR’s Pending Home Sales Index dropped 11.6 percent to 81.9 in April, the lowest since September. Pending home sales lead existing home sales by a month or two. Economists, who had expected pending home sales to fall 1.0 percent last month, said bad weather in some parts of the country might have affected home shopping.
So what to make of the mixed bag? Overall, the nation’s economic recovery is moving forward, albeit at a modest pace. Nationally, the housing market is fighting to work through the overhang of foreclosed and distressed properties. It’s not easy, and will take time. But it will happen.
However, more than ever, we’re reminded of how much real estate is about location, location, location. Things are far better here in the Bay Area. The overall market is much more stable than elsewhere in the nation, and in some pockets, it’s fairly robust. We continue to have multiple offers. Not every property for sure, and not all multiple offers are well over the asking price. But this is a strong indication of Bay Area buyer demand that most of the nation is not experiencing today. Thoughtful and strategic pricing, combined with staging interior and exterior of property are key elements to having the best chance at multiple offers. Luxury housing market reports out this week continue to show strong demand for high-end properties in particular.
San Francisco Real Estate Update:
Sales activity is improving. Inventory of quality, well priced homes is low and sell right away when it comes on the market. Homes in questionable condition, or short sales, sit unless they are bargain priced. Buyers complain they would like to buy but can't find the right place at the right price, then go in droves for multiple offers when something good comes on the market. There has been good open house traffic and improving number of sales in May in the Marina area. Each sale takes a realistic seller and a buyer not always looking for a bargain - just the right price. The Sunset market is stable, and there seems to be more negotiations from beginning to closing. Buyers are tending to be careful about price and condition of the property. The home sales cycle is taking longer to close, with re-negotiation after inspections. Pacific Heights sales and inventory are on the rise, and we are seeing multiple offers for some properties.
Marin Real Estate Update:
Inventory is on the rise in central Marin, but sales activity has been easing a bit. Nonetheless, one property on the market at $975 in Corte Madera received nine offers - a pretty good sign that there are buyers out there ready to go when they see a property they like. Southern Marin is steady. Strong negotiating seems to be the name of the game, but ultimately homes seem to get into contract.
MAY 17, 2011
San Francisco Real Estate Update:
The good activity from April is continuing through May, but the market seems hard to pin down or predict with one property bringing multiple offers way over the price and other slightly less attractive properties lingering and getting stale. The market remains lender-driven. Well-priced listings are moving within a week, forcing buyers to move quickly. Being informed about the pace of the market is critical... knowing when to come in strong (as a buyer), as multiple bids are increasingly common. Another interesting observation in a recent sales meeting was a handful of SF properties that sold in the last 18 months, were fixed up minimally and listed for sale again, with a nice increase over the previous sale price, illustrating that buyers will pay for turn-key property. Open houses are well attended, especially in the under-$1 million market. The move-up market is slower ($1 mil to $1.5 mil). Overall, the demand is here, but we need more well priced inventory to sell. The market remains at a strong pace, including the high end.
Marin Real Estate Update:
The market has been schizophrenic: Slow, then a surge and crazy busy, and then slow again. The spring selling season started off early and with a bang, with lots of new inventory in March. However, we are seeing a lot of deals fall through and the new opens – at least for this week – have slowed. As the weather improves, so does the interest in open houses. Buyers are interested and looking at properties at various price points. Open houses are well attended and overall the mood is upbeat. The Previews market in Southern Marin continues to roll along, but sellers are often having to come down substantially on their initial highly priced property to get the property sold. That said, if a property is perceived as a good value, it is not out of the question to see multiple offers.
FEBRUARY 2011
San Francisco Market Trend Report February/March 2011. San Francisco real estate market trends including average home prices, average days on the market, mortgage rate outlook, residential home statistics, foreclosure statistics, condo statistics, and DOM & SP/LP charts.