First Quarter Market Review

Every day we see articles chronicling the collapse of the housing market and simultaneously hear anecdotal stories of multiple offers and properties selling over the asking price. So which scenario is correct? Is it a buyers’ market? Is it a sellers market? Are home values declining or increasing? The short answer is "Yes." The Bay Area real estate market is a highly segmented marketplace; some areas are struggling while others continue to thrive. In some sub-markets there is very little inventory, which continues to push prices higher; while others are flooded with homes and not enough buyers.

In San Francisco, the median price for single-family homes increased 23.74% to $1,237,000 in the 1st quarter of 2008 versus the same period in 2007, while the average days on market decreased 9.78% to 35 days. However, these strong gains can be deceptive due to a number of factors. For example, several neighborhoods reported extremely strong gains, but because of the small number of transactions they are not statistically relevant and skew the results for the overall market. These neighborhoods include Golden Gate Heights, Lower Pacific Heights, Haight/Ashbury, and Russian Hill. With that in mind many neighborhoods reported strong gains and a significant number of sales with Glen Park (42%; $1,250,000), Noe Valley (31.90%; $1,625,000), and Marina (21.63%; $2,382,500) leading the list. These gains were balanced by decreased median prices in Ingleside (-28.54; $566,000), Oceanview (-28.06; $502,500), and Potrero Hill (-23.60; $955,000).

In the condominium category in San Francisco, the median sales price increased a modest 2.68% to $729,000 and the average days on market decreased 3.93% to 41 days. Cow Hollow (82.04%), Western Addition (74.65%), Noe Valley (51.84%), and Telegraph Hill (44.09%) showed the largest increases. However, these gains were primarily buoyed by restricted inventory and a reduction in the number of sales, e.g. Noe Valley and Telegraph Hill reported a 66% and 73% drop in the number of sales, respectively. Just to keep things interesting, however, the Western Addition reported a 50% increase in the number of sales, further demonstrating that there is no single answer to explain the growth within San Francisco’s housing market.

Aldo Congi, vice president for McGuire Downtown said, "Inventory has been very limited during the 1st quarter of 2008, which is reflected in the relatively low days on market and the increasing median sales price. Well-priced listings continue to receive multiple offers—indicating that buyers are out there. However, inventory is beginning to increase these past few weeks, which given the number of buyers currently in the market, should lead to a spike in the number of sales and in the median prices in the 2nd quarter."

If you would like information on a specific district or category, please contact me. I’m happy to assist you and help you to better understand this fast-paced, ever-changing market.

 

Graph of median price of home sales in San Francisco

Median price of all home sales in San Francisco over the last two years

Graph of median price of condos in San Francsico.

Median price of all condo sales in San Francisco over the last two years

Key to Charts:

  • Each green bar is the median sales price in that month.
  • The blue numbers are the average days on market in that month.
  • The black numbers are the number of sales in that month.

    • All data subject to errors, omissions, or revisions and is not warranted. Data provided by San Francisco Association of Realtors, BAREIS MLS, and REInfo Link. All information deemed reliable, but not guaranteed.

    Back To April 2008 Newsletter.