A Berkshire Hathaway Affiliate
Buy.Sell.Stay. January 2016 Market Report San Francisco
2016 Intero Real Estate Services Inc., a Berkshire Hathaway affiliate and a wholly owned subsidiary of HomeServices of America, Inc. All rights reserved. Data provided by Trendgraphix February 2016. All information deemed reliable but not guaranteed. This is not intended as a solicitation if you are listed with another broker.
Executive Insights Introducing Intero Real Estate’s January 2016 San Francisco Market Report It’s just the beginning of 2016, the year is new, there are endless possibilities, and we predict the future to be promising! At least that’s how Tom Tognoli, President & CEO of Intero Real Estate Services, Inc. feels. “I know the financial markets have been a bit rocky the last few months, but when you step back and look at the fundamentals of the Bay Area real estate market, it’s strong! Companies like Apple, LinkedIn, Netflix, Facebook, and Google are flush with massive amounts of cash, they are acquiring land and buildings to add more employees, and interest rates are still at ridiculous low levels. Combine that with the Bay Area being one of the nicest places on the planet to live and it makes me optimistic!” As January rounds out the holiday season, this year we found the Bay Area market started on a somewhat slow note – which was to be expected. As families celebrated the holidays, participated in numerous local Super Bowl events, and endured El Niño, housing sales slowed down. All of which is to be expected at this time of year. So as the weather becomes warmer and the flowers begin to bloom a natural increase in activity should present itself. Overall, we’re seeing the market to be slightly in favor of sellers. Inventory throughout the Bay Area has been somewhat low, giving buyers less to choose from and sellers more flexibility with higher prices. This can be largely attributed to the massive job growth throughout the area. California Association of Realtors (C.A.R.) projected statewide job growth to be 2.3% in California this year, creating the lowest unemployment rate we’ve seen over the past 5 years. To put it simply, more jobs means more people need houses, so as the year progresses, we will see more homes being built to accommodate new jobs, and more homes being put on the market. C.A.R. Vice President and Chief Economist Leslie Appleton Young echoes these sentiments, and provides a detailed outlook: “The foundation for California’s housing market remains strong, with moderating home prices, signs of credit easing, and the state continuing to lead the nation in economic and job growth,” she stated. “However, the global economic slowdown, financial market volatility, and the anticipation of higher interest rates are some of the challenges that may have an adverse impact on the market’s momentum in 2016. Additionally, as we see more sales shift to inland regions of the state, the changes in mix of sales will keep increases in the statewide median price tempered.” Okay – that may have been a little bit much and sounded a little confusing, we know. That’s why we’ve taken a much closer look, and broken it down into bite sized, easy to understand pieces for you. The market changes in meaningful ways each month, and we want to make sure that you’re always provided with the most accurate and up to date information possible so you’re always well informed. If you want to buy, sell, or just get a general sense of your neighborhood, this report has you covered.
Market Highlights San Francisco
Total Homes for Sale
136
Luxury Homes for Sale*
18
*Homes for sale above $3 million.
Total Homes Sold
Average Days on Market
Average List Price
Average Sold Price
93
$1,902,000
43
$1,499,000
Inventory San Francisco
Total Number Of Homes:
For Sale
Sold
262
196
212 221
157 173
155
188 198
179 186
184 192
160 173
184 186
136
125 79
93
98
100
114
168
178
152
185
200
231
250
150
270
300
65
50
0 14-Nov
14-Dec
15-Jan
15-Feb
15-Mar
15-Apr
15-May
15-Jun
15-Jul
15-Aug
15-Sep
15-Oct
15-Nov
15-Dec
16-Jan
Inventory Insights Like December, January’s market leaned in favor of sellers. Total property sales in January continued to lag slightly behind the number of sales this time last year and by a significant amount compared the previous month, perhaps making it one of the lowest inventory months in recent years. But that’s pretty normal with seasonal factors taken into consideration. The holiday season is historically slower than the rest of the year when it comes to home sales; families want to spend time together undisturbed, the weather is less than ideal, people travel, large events like the Super Bowl happen – you get the picture. The total number of homes available for sale in January marginally increased compared to last year, but more than doubled compared to the previous month. This shows that we are beginning to get over the seasonal lull, but even so, inventory is still quite low. This means that buyers who have been waiting to buy will have fewer homes to choose from, which is great news for sellers! But as winter passes and spring begins, we’ll begin to see more homes on the market accompanied by more sales. Buyers who are still willing to bide their time should take notice, because as the year progresses and the seasons change, the market will change, too!
Inventory By The Numbers Home Price Range
Homes For Sale
Year Over Year % Difference
< $500K
1
-75%
$500K $1M
51
-23.90%
$1M - $3M
66
61.00%
$3M - $5M
9
350.00%
$5M - $10M
7
0%
$10M +
2
-50.00%
Pricing San Francisco
Average Prices in $,000:
3000
Active Price
Sold Price $2,470
2500 $2,055 $2,023
2000
$2,102
$2,177
$2,150
$2,082 $2,036
$1,919
$1,832 $1,846
$1,653
1500
$1,726
$1,792
$1,613 $1,724
$1,507
$1,429 $1,277
1000
$2,220 $1,902
$1,496
$1,630
$1,544
$1,466
$1,675 $1,474 $1,499
$1,318
$1,226
500
0 14-Nov
14-Dec
15-Jan
15-Feb
15-Mar
15-Apr
15-May
15-Jun
15-Jul
15-Aug
15-Sep
15-Oct
15-Nov
15-Dec
16-Jan
Pricing Insights The average “For Sale” price in January was $1,902,000, down slightly from both last year and the previous month. The average “Sold” price saw a moderate increase from last year and a very slight increase from the previous month, settling at $1,499,000. This increase in “Sold” prices does not necessarily have to be foreboding for buyers, however, as the large difference between the average “For Sale” and “Sold” prices also shows us that there’s still always room for negotiation. In this sense, both buyers and sellers fared fairly well this January! Since we are still getting over the fervor of winter and the holidays, the development of competitive pricing and negotiation may have a slow start. But as the year progresses, both supply and demand will continue to grow, leading to more competitive bidding.
Pricing By The Numbers
Average Price Per Square Foot.
$824
2.9%
Month over Month
On The Market San Francisco
Average Days On Market
50 45
43
42 39
40
38
37
35
31
30
36 33
31
36 33
31
30
28
30 25 20 15 10 5 14-Nov
14-Dec
15-Jan
15-Feb
15-Mar
15-Apr
15-May
15-Jun
15-Jul
15-Aug
15-Sep
15-Oct
15-Nov
15-Dec
16-Jan
0
Days on Market Insights The Days on Market (DOM) shows, on average, how long properties are on the market before they sell. The amount of time it takes a house to sell can help us determine whether buyers or sellers are having a more favorable month. This January’s DOM was 43 days, a week longer than the previous month and just one day shorter than last year. In this sense, it was a great month for buyers; the longer a house is on the market, the more likely it is that there will be room for negotiation, and lowered prices. Sellers should not be discouraged, though! While January’s DOM was relatively long, it aligned with the current seasonal lull and it’s not uncommon for a house to be on the market for at least a month. And again, demand will continue to grow, eventually causing competitive bidding and much faster sales. Stay tuned, sellers!
DOM By The Numbers Home Price Range
Days on Market
Year Over Year % Difference
< $500K
25
-444%
$500K $1M
34
-35%
$1M - $3M
43
21%
$3M - $5M
51
78%
$5M - $10M
128
0%
$10M +
0
N/A