This is for the high-price-tier index for the 5 county San Francisco Metro Statistical Area (MSA). The home values of the city of San Francisco itself (not reflected on the two charts below) went up more in run up to the financial markets crash of 2008, then declined less with the crash and now is recovering more quickly in 2012, than the entire 5 county MSA market.
Updated San Francisco Market Charts
Sales Price to List Price Percentage & Days on Market
In November, the vast majority of San Francisco homes that sold, sold very quickly without any price reduction, at an average sales price 4% above the list price: That is a strong, hot market. Properties that had to go through price reductions took over 2 months longer to accept offers and sold at a significant discount to original list price. And even in a hot market, there are listings that do not sell at all, but expire or are withdrawn from the market: Many of these will ultimately be relisted at lower prices and eventually sold.
Average Sales Price
The average price is simply the total dollar volume of sales divided by the number of sales. Like median price, it is a general statistic affected by a variety of factors and often fluctuates without great significance on a monthly basis. Among other factors, a decline in distressed home sales and/or an increase in high-end home sales, both of which are occurring now in SF, can have an outsized effect on average sales price. October saw a big jump in average sales price, and then it went up again in November. If the market acts in its typical manner, it will now fall in December and January, since the more affluent home market tends to withdraw for the holidays. (We limit this analysis to sales of up to $3m because the 5% of home sales above that – going up to $12m – $20m – severely distort the overall average by hundreds of thousands of dollars.)
Median Sales Price
The median home sales price is that price at which half the sales occurred for more and half for less. It is a very general statistic and what’s important is the trend over the longer term — monthly fluctuations are normal. Still, October-November saw a large increase over the relatively static median prices seen in the previous 6 months, which followed the big jump in early 2012. Usually, median prices will fall in December and January as the higher end market checks out for the holidays. Remember that sales prices reflect accepted offer activity in the 4 to 10 weeks prior. (The small decline from October to November is probably not statistically significant – unless substantiated as a longer term trend.)
Months Supply of Inventory: Very Low
MSI is a measure of how long it would take to sell the current supply of listings at the existing rate of sales. In October and November, it was about as low as it has ever been. This would typically be interpreted as a strong “seller’s market.”
New Listings & the Inventory of Listings for Sale
After the inventory spike in September from the large influx of new listings, in October and November the number of new listings (the first chart below) and the total number of homes for sale (second chart below) are markedly declining and will almost certainly continue to do so until early 2013.
Percentage of Listings Accepting Offers (Buyer Demand)
The statistic used on this chart boils down the supply and demand dynamics into a single statistic. The percentage of listings accepting offers in October and November was probably about as high as it has ever been, far above the level of previous years. The decline seen in September was the result of a large influx of new listings hitting the market in mid-month – these were snapped up at the same fast rate, but many didn’t accept offers until October, after a reasonable marketing and showing period.
September Case-Shiller Index Released
For the high-tier price index, there was virtually no change from August to September, though the lower price tiers continued to increase (these tiers are especially affected by the decline in distressed home sales). Here are 2 updated charts if you’d like to use one or more of them, one long-term, one short-term.
SF Luxury Home Report
The San Francisco Luxury Home Market
A Market Overview by the Paragon Real Estate Group
The luxury home market in San Francisco – typically defined as houses, condos, co-ops and TICs selling for $1,500,000 or more – experienced a big surge in activity in the second quarter of 2012. The third quarter saw a decline typical for the summer months, but was still 50% higher than the third quarter of last year. With the increased demand has come a significant increase in values throughout the city.
The SF luxury home segment is currently made up of three dynamics: 1) general-appeal (often spectacular), well-priced listings that buyers are jumping all over and often bidding up far over the asking price, 2) listings that the market has deemed considerably overpriced – by hundreds of thousands or even millions of dollars – that the market is generally ignoring, and 3) niche or special-circumstance properties for which there is an extremely limited buyer pool – even if priced fairly, these can take some time to sell.
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Sales Over, Under & At List Price
In the third quarter, a high percentage, 44%, of luxury home sales in San Francisco sold for above asking price; 15% sold for at least 10% over asking price – an indication of very strong demand; 42% sold below original list price; and 14% closed at list price. It should be noted that a fair number of high-end homes have sold off-market in 2012, i.e., not listed or reported to MLS, from which we derive our data.
Average Dollar per Square Foot
Luxury homes throughout the city have seen a substantial jump in dollar per square foot values since 2011. Values vary widely by neighborhood and property type, and can generally range anywhere from $500 to $2000 per square foot. The highest per square foot values are typically found in the most prestigious mansions on the north side of town and in penthouse condos in the South Beach/ Yerba Buena and Pacific Heights/ Russian Hill areas. Absolutely spectacular views are a common aspect of these sales.
Luxury Home Unit Sales
The second and third quarters of 2012 saw the highest number of luxury home sales of any quarter since 2008. The decline in the third quarter was typical for this market segment during the summer months, and was over 50% higher than the third quarter of 2011.
Sales Price to Original List Price by Days on Market
Most of the luxury homes that sell are sold relatively quickly after the listings arrive on market, and these sales are selling for an average of 102% of list price. Those listings that go through price reductions sell at a significant discount to original price and spend almost 3 months longer on market. And even in a strong market, a solid percentage of listings don’t sell at all, almost always due to being perceived as overpriced.
Inventory of Available Listings
As is typical, September was the month with the highest number of new listings hitting the market, which often leads to an autumn surge in closed sales. It is almost certain that the number of new listings and available inventory will now continue to dwindle until the new year begins. More often than not, the luxury home market goes into a semi-hibernation from Thanksgiving to mid-January.
San Francisco Luxury HOUSE Sales by District and Price Range
Home sales with a price of $1,500,000 and above now take place across the city, but the sales cluster in certain areas and prices vary widely by location. These 4 charts break the luxury home market into price segments and property types by Realtor district.
SF HOUSES Selling for $1,500,000 to $1,999,999
SF HOUSES Selling for $2,000,000 to $4,999,999
SF HOUSES Selling for $5,000,000 or More
SF CONDOS, CO-OPS & TICs Selling for $1,500,000 or More
August Case-Shiller Index
The Case-Shiller Index for August for the 5-county San Francisco Metro Statistical Area was released today. It showed a small improvement from July’s reading and is now at its highest point since December 2008.
San Francisco Residential Market Trends in Realtor District 5: Noe/ Castro/ Haight
A statistical market overview for Noe Valley, Eureka Valley & the Castro, Cole Valley,
Mission Dolores, Haight Ashbury, Ashbury Heights, Clarendon Heights, Parnassus Heights,
Corona Heights, Glen Park, Twin Peaks & the Duboce Triangle
Below are a variety of charts detailing market conditions and trends in the neighborhoods of San Francisco’s central Realtor District 5. District 5 is one of the more homogeneous districts in San Francisco in terms of property values, but still any analysis of an area with so many properties of different type, location, condition and quality can only be a very general overview.
District 5 soared in value between 1996 and 2008 and was one of the last districts to peak in value before the market meltdown in September 2008. Values fell 15% to 20% very quickly and then stabilized in 2009 and 2010. The market started to turn around in 2011 and, now in 2012, the competition between buyers has become ferocious: inventory is very low and many of the listings are selling very quickly in multiple-offer, competitive-bidding situations. This is exerting considerable upward pressure on prices: generally speaking, values are soaring once again.
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MEDIAN SALES PRICE is that price at which half the sales occur for more and half for less. It can be, and often is, affected by other factors besides changes in market values, such as short-term or seasonal changes in inventory or buying trends. Though often quoted in the media as such, the median sales price is NOT like the price for a share of stock, i.e. a definitive reflection of value and changes in value, and monthly fluctuations are generally meaningless. If market values are truly changing, the median price will consistently rise or sink over a longer term than just 2 or 3 months, and also be supported by other supply and demand statistical trends.
AVERAGE SALES PRICE is calculated by adding up all the sales prices and dividing by the number of sales. It is different from median sales price, but like medians, averages can be affected by other factors besides changes in value. For example, averages may be distorted by a few sales that are abnormally high or low, especially when the number of sales is low.
DAYS ON MARKET (DOM) are the number of days between a listing going on market and accepting an offer. The lower the average days on market figure, typically the stronger the buyer demand and the hotter the market.
MONTHS SUPPLY OF INVENTORY (MSI) reflects the number of months it would take to sell the existing inventory of homes for sale at current market conditions. The lower the MSI, the stronger the demand as compared to the supply and the hotter the market. Typically, below 3-4 months of inventory is considered a “Seller’s market”, 4-6 months a relatively balanced market, and 7 months and above, a “Buyer’s market.”
DOLLAR PER SQUARE FOOT ($/sqft) is based upon the home’s interior living space and does not include garages, unfinished attics and basements, rooms built without permit, lot size, or patios and decks — though all these can still add value to a home. These figures are usually derived from appraisals or tax records, but are sometimes unreliable or unreported altogether. All things being equal, a house will sell for a higher dollar per square foot than a condo (due to land value), a condo higher than a TIC (quality of title), and a TIC higher than a multi-unit building (quality of use). Everything being equal, a smaller home will sell for a higher $/sqft than a larger one. (However, things are rarely equal in real estate.) There are often surprisingly wide variations of value within neighborhoods and averages may be distorted by one or two sales substantially higher or lower than the norm, especially when the total number of sales is small. Location, condition, amenities, parking, views, lot size & outdoor space all affect $/sqft home values. Typically, the highest dollar per square foot figures in San Francisco are achieved by penthouse condos with utterly spectacular views in prestige buildings.
Who is San Francisco? City Demographics
Who is San Francisco?
Who We Are, How We Live, What We Do, How We Rank
How many San Franciscans:
Trace their ancestry from China, Ireland, Mexico or the Philippines?
Are children under 5? Speak Spanish at home? Have their cars stolen?
Are heterosexual or gay? Divorced? Live alone? Give birth each year?
Vote Libertarian? Earn over $200,000/year? Have graduate degrees?
There is no city in the world like San Francisco – and here are some of the details.
For analyses of the city’s real estate market, please see links at bottom of newsletter.
Case-Shiller High-Tier Home Price Index Highest Since December 2008
The July report of the Case-Shiller Home Price Index was released today. All price tiers for the 5-County San Francisco Metro Statistical Area increased. The high-tier price index, which best applies to the city of San Francisco itself, hit its highest point since December 2008.
Recent trends by month, 2011-2012:
Annual trend line since 1996:
Simplified trend line since 1982:
A more detailed explanation of the Case-Shiller Index can be found here: http://www.paragon-re.com/Case_Shiller_Index_Deciphered_for_SF