San Francisco Real Estate

Neighborhood House & Condo Prices; Short-Term & Long-Term Appreciation Trends; Population Migration In & Out of the City.

After the heat of the spring market, activity typically slows down markedly in July and August. In September, listings start pouring on the market again to fuel the relatively short autumn selling season – in fact, September is typically the single month with the highest number of new listings. Autumn is also a very important time for the luxury home market – luxury house sales often peak for the year in October.

What occurs in the next 2 months, before the mid-winter holiday doldrums begin, will be the next major indicator of market conditions and direction.

Migration: People Moving In & Out
of San Francisco

Using new U.S. Census estimates released 8/29/19, this chart attempts to identify U.S. counties, states and international regions with the highest number of residents migrating to and from our county. In the Bay Area, there is a general trend outward from more expensive to more affordable places, while in-bound migration is deeply affected not only by exchanges between Bay Area counties, but people arriving from other parts of the state, country and world. Areas often have large two-way exchanges of residents.

Foreign in-migration is a huge issue in SF and the Bay Area, but it will be another year before any impact of new U.S. immigration policy on foreign in-migration in 2018 shows up in census numbers. The census estimates foreign in-migration in this analysis, but not foreign out-migration.

Short-Term & Long-Term Trends
in Median Home Prices

San Francisco is out-performing the Bay Area – most of the other counties have seen 3% to 5% declines in median home prices since peaking in spring 2018, while the city saw a new monthly peak in June and a new quarterly peak in Q2. It has been suggested that the differentiating factor in SF has been the high number of large, local, high-tech IPOs occurring this year since early spring.

In the next chart, the 2019 YTD median sales prices should be considered preliminary until full year data is in. Note that it is more difficult to compare annual median condo prices on an apples-to-apples basis because of the huge number of new construction condos – many at higher prices – coming on market in the last few years. Comparing 2019 YTD to 2018, the median house sales price is about the same, even though new monthly and quarterly peaks were hit year to date.

Supply & Demand Dynamics since 2005

The chart below compares supply, the number of active listings on the market, with demand, as measured by the number of sales. This is a 12-month-rolling graph that smooths out normal monthly fluctuations to provide clearer historical trend lines.

San Francisco Home Prices & Appreciation
by Neighborhood & District

The next long series of charts and tables looks first at house prices by neighborhood, and then at condo and co-op prices. We’ll start with our neighborhood/ Realtor District map for easy reference.

San Francisco Median House Sales Prices
by District & Neighborhood

San Francisco Median Condo Sales Prices
by District & Neighborhood


San Francisco Bay Area Real Estate Markets Survey

Note that it is not unusual for median home sales prices to peak for the calendar year in spring (Q2). This is due not only to heightened buyer demand, but also to the extreme seasonality of the luxury home market – more luxury home sales (as a percentage of total sales) pull overall median sales prices up.

Year-over-Year Median Home-Price Appreciation (or Depreciation) Rates

Markets in late 2017 through spring 2018 were very hot virtually throughout the Bay Area – perhaps the hottest they’ve been since 2000, the height of the dotcom boom. In the second half of 2018, markets cooled considerably – besides issues of simple affordability, financial markets saw nerve-wracking volatility and large declines, and interest rates jumped dramatically. Then, in 2019, stock markets recovered to hit new peaks and interest rates hit multi-year lows, and markets heated up again.

However, generally speaking, except for those markets most affected by the slew of local high-tech IPOs – San Francisco and the greater Oakland market – most markets saw either no significant year-over-year appreciation or year-over-year declines in median house sales prices. (Santa Cruz County bucked this trend.) The next major indicator of market direction will come from autumn selling season data: The season runs from early-mid September to early-mid November. Markets then typically go into the mid-winter holiday doldrums for a couple months.

Bay Area & California Long-Term Median House Price Trends

Median House Sales Price Trends by Bay Area County

Compound Annual Home Price Appreciation Rates

When calculating these rates, results can vary enormously depending on the year the calculation begins with. These start with the year 2000 – if we started with 1995 – prices rapidly appreciated between 1995 and 2000 – the rates would jump; if we began with 2007 – the height of the subprime boom – then the rates would drop. (The same issue exists with calculating stock market returns.)

These very approximate calculations do not reflect any of the tax benefits that have applied at various times to home ownership and to the sale of one’s primary residence. And they are based simply on the all-cash purchase price and the sales price, without adjusting for closing costs (or the effect of not paying all cash upon purchase).

Bay Area House & Lot Sizes

Bay Area Median Condo Values

Bay Area Median Dollar per Square Foot Values

Bay Area Luxury Home Markets

Median Sales Prices for Large Homes in Expensive Bay Area Markets

High-end home markets in outlying counties – the four with the lowest percentages in the chart below – have softened considerably, and would typically be considered to be in buyer’s market territory – much more supply than demand. This doesn’t mean, however, that some luxury homes there don’t sell quickly at excellent prices. It does mean that many luxury homes don’t sell without price reductions, or don’t sell at all.

In many ways, average dollar per square foot values give a better indication of what one actually gets for one’s dollar in different counties.

Bay Area & U.S. Home Prices, Appreciation Trends & Affordability

The next chart illustrates the dramatic divergence since 2012 between Bay Area home price appreciation – supercharged by the high-tech boom – and the national trend line.

Median 3-Bedroom Home Sales Prices around the Country

Active Listings on the Market

Home Sales Volumes

Bay Area Home Sales by Price Segment

Bay Area Real Estate Market Indicators

Below are a wide variety of standard market statistics broken out by county or region to illustrate respective market conditions, as well as overall trend lines to illustrate the general market direction and the effect of seasonality on supply and demand.

Looking just at 2019 YTD stats, the greater Oakland-Berkeley market has been the strongest in the Bay Area. In San Francisco, the picture is muddied a little by the fact that the city’s house and condo markets have somewhat different dynamics: New-condo construction has increased supply in that segment, while the supply of house listings has declined markedly since 2010, making houses the scarce resource in a high-demand environment.

Price Reductions & Listings Expiring without Selling

San Francisco Bay Area Median House Sales Prices by City

Bay Area Median List Rents

Selected Economic & Demographic Factors

Behind the real estate boom is the stupendous boom in hiring, specifically in the high-tech fields.

Migration & Population Trends


Housing Affordability in the San Francisco Bay Area

Home Prices, Appreciation & Ownership Costs; Affordability Percentages, Household Incomes, Interest Rates, Rents & Homelessness. August 2019 Report – including 30 illustrative charts.

Housing affordability may be the largest social and political issue in the Bay Area, and the effects of low affordability also greatly impact the general economic picture in a wide variety of important ways – from hiring and business relocation, to the ability of “normal working people” (not enriched by the high-tech boom) to live here. Significant demographic shifts are also taking place as some groups move out and others move in.

Generally speaking, affordability percentages – the percentage of county households who could afford to purchase a median-priced house – ticked up in Q2 2019 as compared to Q2 2018: Median home sales prices were relatively stable year-over-year – some counties up a bit, some down a bit, some the same – but interest rates dropped very significantly over the 12 month period. However, affordability percentages remain low by historical standards – and the Bay Area typically has among the lowest in the nation.

Note: Counties contain cities, and cities contain neighborhoods of varying values, market conditions and trends.

Calculations on affordability percentages, home payments and household incomes are based upon the California Association of Realtors Housing Affordability Index, measuring the percentage of county households able to afford to buy a median priced house with a 20% down-payment at prevailing mortgage interest rates.

The next 2 charts are excerpted from the very in-depth report, “Bay Area Homelessness: A Regional View of a Regional Crisis” put out by Bay Area Council Economic Institute, published April 2019.

It is impossible to know how median and average value statistics apply to any particular home without a specific comparative market analysis. These analyses were made in good faith with data from sources deemed reliable, but may contain errors and are subject to revision. It is not our intent to convince you of a particular position, but to attempt to provide straightforward data and analysis, so you can make your own informed decisions. Median and average statistics are enormous generalities: There are hundreds of different markets in San Francisco and the Bay Area, each with its own unique dynamics. Median prices and average dollar per square foot values can be and often are affected by other factors besides changes in fair market value. Longer term trends are much more meaningful than short-term.


San Francisco Real Estate August 2019 Report

Sales & Values by District and Price Segment, Special Circumstance Sales, Market Seasonality, the Luxury Home Market & Foreign Buyers. The May Case-Shiller Home Price Index was released in late July for the 5-county SF metro area. This chart illustrates the difference in appreciation rates between the Bay Area (higher price markets) and the entire country. Case-Shiller does not use median sales prices but its own algorithm to calculate appreciation. January 2000 home price = 100; 250 = a home price 150% above that of Jan. 2000.

Needless to say, there are many factors behind home sales and values in different communities. Home size is one of them, and median sales prices are not apples to apples comparisons: For example, in Pacific Heights, the average house size is over 4000 square feet, while in Sunnyside, it runs about 1500 square feet.

Note that it is not uncommon for median sales prices to peak for the year in Q2.

Market Dynamics by Realtor District

Q2 is commonly the hottest market of the calendar year, and the statistics below generally reflect a very strong spring 2019 market.

Home Sales by Price Range

Of homes selling for under $1,000,000, over 80% were condos, co-ops and TICs, and most of those were smaller units.

Tenants, Fixer-Uppers, Homes without Parking, Homes with Golden Gate Bridge Views

Market Seasonality: The Autumn Spike,
Then the Winter Doldrums

Though spring is the biggest overall selling season in San Francisco, the single month with the highest number of new listings is typically September. This big surge fuels the relatively short autumn selling season – highlighted by the dramatic spike in sales in October. In November, activity begins to plunge for the mid-winter holidays – though homes continue to sell in every season.

Seasonality: New Listings by Month

New Listings – Long-Term Trends,
12-Month Rolling Figures

Seasonality: Listings Going into Contract
by Month

Higher-Price Home Sales

The central greater Noe-Eureka-Cole Valleys district now has the highest number of home sales over $2 million, but the northern Pacific Heights-Cow Hollow district dominates sales of $5 million and above.

The SF luxury home market is even more dramatically driven by seasonality than the general market. September often sees a tremendous burst of new listings. October is sometimes the single month with the most luxury house sales.

Long-Term Appreciation Trends by District

Though prices vary, appreciation trend lines since the recovery began in 2012 are often relatively similar.

In the next chart, we combine house sales across the swathe of older, prestige neighborhoods that run across the north of the city – generally speaking, a region of larger houses and higher prices. (Putting them on the chart above would flatten the other trend lines due to issues of scale.) None of these neighborhoods have that many sales – and some have very, very few – so we combine them to increase statistical reliability. Though they are all high-price, prices do vary considerably between them.

Median Two-Bedroom Condo Prices
by Realtor District

There is significantly less variation in condo prices in most of the neighborhoods of SF than there is with houses. Much of this has to do with all the new construction that has occurred in the last 20 years. Probably the greatest differences in condo values are between those on lower floors and those on higher floors of new luxury high-rises.

Percentage of Sales Selling for Over List Price
by Property Type

Median Percentage of Sales Price to List Price
by Property Type

Foreign National Home Buying Tumbles

According to a new report by the National Association of Realtors – based on a survey of its member agents – the purchase of U.S. homes by foreign nationals plunged in the 12 months through March 2019. The drop was particularly steep for Chinese nationals, for whom California (and the Bay Area, in particular) has been the top destination.

Stock Market Hits New High

The last 12 months have been an extremely dramatic time for financial markets as illustrated below. The alternating confidence and fear generated by its swings have been considerable factors in Bay Area real estate markets. A parallel dynamic has occurred with the swings in interest rates.

The spring burst in high-tech IPOs in San Francisco also played a role in the heat of the Q2 market.


CoreLogic S&P Case-Shiller Home Price Index Update

The CoreLogic S&P Case-Shiller Home Price Index does not evaluate median sales price changes, but employs its own proprietary algorithm to measure home price appreciation over time. Since its indices cover large areas – for example, the San Francisco Metro Area is comprised of 5 counties – which themselves contain communities of widely varying home values, the C-S chart numbers do not refer to specific prices, but instead reflect prices as compared to those prevailing in January 2000, which are all designated as having a consistent value of 100. A reading of 250 signifies that home prices have appreciated 150% above the price prevailing in January 2000.

Case-Shiller divides all the house sales into thirds, or tiers: The third of sales with the lowest prices is the low-price tier; the third of sales with the highest sales prices is the high-price tier; and the third in between is the mid-price. The price ranges of these tiers change as the market changes. The 3 price tiers experienced dramatically different bubbles, crashes and recoveries over the past 18+ years, to a large degree determined by how badly the tier was affected by the subprime financing crisis. The low price tier was worst affected – huge bubble, huge crash, most dramatic recovery – and the high price least affected (but still significantly affected).

Most house sales in expensive counties such as San Francisco, Marin and San Mateo, as well as affluent communities in other Bay Area counties are in the “high price tier”, and many would qualify for an “ultra-high-price tier,” if such existed. All counties, to varying degrees, have sales in all 3 price tiers.

The Index is published 2 months after the month delineated – the May 2019 index was released 7/30/19 – reflects a 3- month rolling calculation, and one month’s sales generally reflect accepted-offer activity in the previous month. The Index is looking into a rear-view mirror at the market 3 to 5 months ago: The May 2019 reading, released in late July, mostly reflects market conditions in February – April 2019.

The 5 counties in our Case-Shiller Metro Statistical Area are San Francisco, Marin, San Mateo, Alameda and Contra Costa: Alameda and Contra Costa are by far the largest markets; SF itself comprises only about 7% of house sales in the metro area. We believe the Index generally applies to other Bay Area counties, such as Sonoma and Santa Clara, though those 2 have had somewhat softer markets over the past year. There are hundreds of unique real estate markets in such a broad region, with different dynamics, moving at varying speeds, sometimes in different directions. How the C-S Index applies to any particular property is impossible to know without a specific comparative market analysis.


How did the spur of IPOs impact Bay Area housing markets?

 

economic-straight-talk

Executive Summary:

  • Higher-end sales (above $3 million) surged in the second quarter to last year’s historical peaks.
  • Home prices remained flat in the second quarter, except in San Francisco and San Mateo.
  • For-sale inventory growth slowed considerably, especially in San Francisco. Inventory remains at 50 percent of the last housing boom.
  • Tax reform is likely putting a damper on the market by dragging down sales priced between $1 million and $2 million.

It was a significant quarter, at least when comes to the IPO activity in the Bay Area. According to Pitchbook, total venture-backed exit value for the first half of 2019 reached $188.5 billion, exceeding every full-year total on record. San Francisco companies ranked in the top four out of five IPOs in exit value including Uber, Slack, Pinterest, and Zoom Video Communications, but also a few others.

But, what did that mean for the Bay Area housing markets in the second quarter? Below is a list of the top four trends that are worth noting for the quarter.

1. Higher-end sales surged. While the total number of homes sold in the second quarter trended below last year by about 5 percent, higher-priced sales, above $3 million, surged again bringing second quarter sales in line with last year’s historical peak. Figure 1 illustrates the 4-year trend of sales of homes priced above $3 million. There were in total about 672 sales between April and May compared to 675 sales last year. Note, though, that sales over $3 million declined about 25 percent in the first quarter before rebounding in the second quarter.

Unlike last year when higher-end sales were popular in Santa Clara and to some extent Sonoma and Contra Costa, this year buyers were more interested in higher-priced homes in Alameda, San Francisco, San Mateo, and Napa. Figure 2 illustrates changes in home sales by price range compared to the second quarter last year.

Out of all homes sold over $3 million, the majority are still in Santa Clara, followed by San Mateo and San Francisco. But Alameda saw a 39 percent jump over last year, followed by a 25 percent jump in Napa, 17 percent in San Mateo and 14 percent in San Francisco. Note that higher-end sales in Alameda still only account for 6 percent of total sales over $3 million.

Figure 1 – 3-month moving average of sales over $3 million

Source: Source: Terradatum, Inc. from data provided by local MLSes, July 7, 2019

Figure 2 – Quarterly year-over-year change in home sales by price range

Source: Source: Terradatum, Inc. from data provided by local MLSes, July 7, 2019

2. Home prices remained flat in the second quarter, except in San Francisco and San Mateo. As noted in previous analyses, home prices in the Bay Area reached a cyclical high last May when the median price topped at $1 million. Since, the prices followed seasonal declines reaching the lowest point in January and have increased since. Figure 3 illustrates Bay Area median home price trend over the last 3 years, pointing to seasonal highs around May-June and troughs in January. Second quarter 2019 is highlighted in red illustrating flattening of home prices in recent months.

Further, Table 1 summarizes current median prices, June year-over-year changes, and year-to-date changes by region. Year-to-date account is most interesting in that it suggests generally flat prices across the Bay Area, except in Santa Clara and Sonoma where prices retracted. Those two regions saw unsustainable growth in prices at the beginning of last year. San Francisco and San Mateo, while flat year-to-date have seen some price acceleration in June with both posting a 4 percent increase year-over-year. Prices in the two areas have again reached historical highs.

Changes in Table 1 also closely reflect the forecast that was presented at the Pacific Union Real Estate Economic Forecast 2020, illustrated in Figure 4. The forecast called for home prices reaching a “Table Top” in 2019-2020 — when prices reach peaks and remain relatively flat with some slight declines in a few areas. As Figure 4 shows, “Table Top” is much different than the “Mountain Peak” that was experienced during the last housing cycle in 2004 to 2007 when home prices rapidly declined as much as 60 percent following the peak. The reasons prices are expected to remain flat this time around is largely due to exceptionally solid mortgage loan underwriting and a significant share of all-cash purchases, coupled with almost negligible new construction growth. Thus, while it’s inevitable to evoke the 2004-2007 period when thinking about home prices going forward, keep in mind that the last housing cycle was considerably different, driven by demand and supply of low-quality loans and a loosely regulated mortgage system, and excess new construction that was absorbed by speculative buying and highly indebted households. Much has changed since. Today’s mortgage system is well capitalized and follows strict Dodd-Frank reform, new construction is roughly 50 percent below the 2004 period and homeowners have a total of about $5.8 trillion in available home equity, the highest volume ever recorded and 16 percent above the last home price peak in 2006. Further, venture-capital activity remains steadily anchored to the Bay Area region, which will continue fueling local economy going forward.

Figure 3 – Bay Area 8-county median home price trend

Source: Source: Terradatum, Inc. from data provided by local MLSes, July 7, 2019

Table 1

Source: Source: Terradatum, Inc. from data provided by local MLSes, July 7, 2019

Figure 4 – John Burns Home Value Index Forecast

Source: Pacific Union International Real Estate Economic Forecast, San Francisco Bay Area to 2020

3. For-sale inventory growth slowed considerably. While overall inventory is about 11 percent ahead of last year, inventory growth and addition of new listings has slowed, suggesting that acute lack of homes for sale continues to hang over Bay Area housing markets. Figure 5 illustrates availability of homes for sale in the Bay Area’s eight-county region going back to 2005. Since 2012, when much of the for-sale inventory was absorbed, inventory levels dropped to about 50 percent of the levels seen between 2005 and 2010. Continued lack of inventory further supports our forecast of flattened home prices over the next couple of years.

Figure 5 Bay Area homes for sale, monthly

Source: Source: Terradatum, Inc. from data provided by local MLSes, July 7, 2019

4. Lastly, tax reform is likely putting a damper on the market by dragging down sales priced between $1 million and $2 million. While the quarter ended with 5 percent fewer sales than last year, or 876 fewer sales, 84 percent of the decline, or 738 units, was due to fewer homes sold priced between $1 million and $2 million. Table 2 summarizes quarterly year-over-year change by price range.

In contrast, sales of units priced below $1 million, similarly to sales over $3 million, remained flat from last year, with gains in Alameda, Santa Clara, and Wine Country offsetting losses in San Francisco and the Peninsula mainly due to no inventory in the lowest price range.

As discussed at the Pacific Union Real Estate Economic Forecast 2020, tax reform which capped state and local deductions to $10,000, and reduced the mortgage interest deduction of a loan up to $750,000 from the previous $1 million cap, significantly increased the cost of owning a home in California. And in the Bay Area, where homes priced between $1 million and $2 million are not considered luxury homes, households that relied on the deductions to be able to afford a home are having a hard time reconciling the purchase.

Table 2

Source: Source: Terradatum, Inc. from data provided by local MLSes, July 7, 2019

Going forward, home buyers could be facing an easier time. Mortgage interest rates have eased from their winter highs and may continue to trend lower depending on forthcoming actions of the Federal Reserve. Nevertheless, according to Freddie Mac’s Primary Mortgage Market Survey, the U.S. weekly average 30-year fixed mortgage rate was at3.75 percent this week, already the lowest since January 2018 (Figure 6).

Figure 6 – U.S. weekly average 30-year fixed mortgage rate

Source: Primary Mortgage Market Survey, Freddie Mac

 


SF Multi-Family Residential Market – Compass Commercial

An interesting 2019 so far: Stock markets have hit new peaks; interest rates have hit multi-year lows; the SF unemployment rate dropped to a historic low; Bay Area unicorn IPOs have rolled out one after the other; SF residential and office rents have ticked up; consumer, corporate and governmental debt levels – nationally and internationally, across virtually every sector – have hit all-time highs; and SF median home prices hit new peaks in Q2.

The below report reflects sales across an enormous range of buildings of different size, quality, location, type and era of construction, unit mix, tenant profile, rent control effects, expense ratios and other characteristics. It is impossible to know how any of these sales or statistics apply to any particular property without a specific, tailored comparative market analysis.

Review of Sales – Last 12 Months

Legislative Update – New Limitations on Sale

SF has enacted a new law called the Community Opportunity to Purchase Act (COPA) impacting Sellers listing or selling buildings with 3+ residential units and lots zoned for 3+ units. It is designed to provide certain Qualified Nonprofit Organizations (QNOs) preemptive opportunities to purchase such properties. As of 9/3/19, Sellers of such properties will have to provide formal notice to these organizations of their decision to sell before they solicit offers or place such properties on the market.

COPA applies to SF multi-family residential buildings on which (1) 3+ residential units exist, including mixed use properties; (2) lots on which 3+ residential units are under construction; and (3) vacant lots on which 3+ residential units could be built. By September 3, 2019, the Mayor’s Office of Housing and Community Development plans to publish the list of QNOs and to issued rules pertinent to implementing COPA. Buyers – especially those affected by 1031 exchange deadlines – and sellers having any questions should engage a qualified San Francisco real estate attorney. Your agent can provide you with a more detailed outline and list of FAQs which the SF Association of Realtors has created.

General Financial Indicators – Updated through Mid-Year 2019

Supply & Demand Statistics

If you would like to receive the list we have compiled of year-to-date San Francisco 5+ unit apartment building sales, with their specific parameters of sale, please let us know.

Rent Rate Trends – Average & Median Statistics

New Housing Construction Pipeline

Sales by Broker


Santa Clara Q2 Real Estate Market – Compass

Santa Clara County saw a rebound in buyer demand, luxury home sales and in median home sales prices in Q2, assisted by stock markets hitting new peaks and interest rates falling to multi-year lows. However, its market remains distinctly cooler than the white-hot period running from late 2017 through mid-2018 – when it was perhaps the hottest metro market in the country, seeing stupendous year-over-year appreciation rates.

Median Home Sales Prices

Home Sales by Property Type & Bedroom Count

Luxury Home Sales

Within the Bay Area, Santa Clara County still has the highest number of home sales at prices of $3 million and above, but they are down from the peak sales volume hit in Q2 2018.

Selected Supply & Demand Statistics

In the next series of market trend charts, generally speaking, one can see the rebound in demand during the spring selling season, but also the general softening of the market that has occurred over the past year.

Overpricing: Negative Effects for Sellers
& Opportunities for Buyers

We performed longer-term analyses of the effects of overpricing – as indicated by the need for price reductions before the property sold – on every major market in the Bay Area and the results were uniformly similar. As would be expected, there were dramatic differences in the sales price to list price percentage and time on market before sale. But there were also very substantial differences in the average dollar per square value realized upon sale.

So, overpricing lowers values for sellers, which also signifies opportunities for buyers who keep an eye out for price reductions and react accordingly.

Mortgage Interest Rates Drop to Multi-Year Lows


San Francisco Bay Area Home Prices by City, Town & Selected City Neighborhoods

An interesting 2019 so far: Stock markets have hit new peaks; interest rates hit multi-year lows; the SF unemployment rate dropped to a historic low; Bay Area unicorn IPOs have rolled out one after the other; SF residential and office rents have ticked up; and SF median house and condo prices hit new peaks in Q2.

In the 2-4 unit market, as seen below, some of the market indicators were somewhat mixed, but overall, SF saw a strong spring market.

Though this report focuses primarily on San Francisco’s 2-4 residential unit market, it will sometimes pull in data from other Bay Area counties to add further context.

12 Months Sales Reviews

Sales Breakdown by Number of Units

Sales Breakdown by Building Square Footage

Annual Trends in Values
with Year-to-Date Updates

Partial year data should be considered preliminary until full year data is in.

Legislative Update – New Limitations on Selling 3+ Unit Residential Buildings

SF has enacted a new law called the Community Opportunity to Purchase Act (COPA) impacting Sellers listing or selling buildings with 3+ residential units and lots zoned for 3+ units. It is designed to provide certain “Qualified Nonprofit Organizations” (QNOs) preemptive opportunities to purchase such properties. AS of 9/3/19, Sellers of such properties will have to provide formal notice to these organizations of their decision to sell before they solicit offers or place such properties on the market.

COPA applies to SF multi-family residential buildings on which (1) 3+ residential units exist, including mixed use properties; (2) lots on which 3+ residential units are under construction; and (3) vacant lots on which 3+ residential units could be built. By September 3, 2019, the Mayor’s Office of Housing and Community Development plans to publish the list of QNOs and to issued rules pertinent to implementing COPA. Buyers and sellers having any questions should consult a qualified San Francisco real estate attorney. Your agent can provide you with a more detailed outline and list of FAQs which the SF Association of Realtors has created.

Selected Supply & Demand Statistics

Average & Median Rent Rate Statistics

Long-Term Trends in Mortgage Interest Rates

Demographic Snapshots

Market Share by Broker


San Mateo Real Estate Q2 Report – Compass

High stock markets, low interest rates, surging luxury home sales, a spring full of local IPOs, and San Mateo County hit a new high in median house sales price (by a nose).

July 2019 Report

San Mateo County real estate saw a strong Q2 market, though, generally speaking, not quite as competitive as the white-hot market in the first half of 2018. The median house sales price bounced back up to slightly exceed the previous peak in Q2 2018, and thus return to positive year-over-year appreciation after the small decline in Q1 2019.

The luxury home market was very strong – the stand out segment – surging to dramatic new highs in sales volumes this spring, mirroring a similar dynamic in San Francisco.

The market typically begins to slow down for summer after the spring selling season ends, though homes certainly continue to sell.

Median Home Prices

San Mateo Luxury Home Sales

Selected Supply & Demand Statistics

Sales volume jumped back up from its mid-winter nadir, but remained somewhat lower than volumes seen in the previous 2 springs.

The next four charts generally indicate solid buyer demand in Q2, but also illustrate the differences between this past spring and the extremely heated demand seen from spring 2017 through spring/early summer 2018.

Overpricing: Negative Ramifications for Sellers
& Opportunities for Buyers

We performed longer-term analyses of the effects of overpricing – as indicated by the need for price reductions before the property sold – on every major market in the Bay Area and the results were uniformly similar. As would be expected, there were dramatic differences in the sales price to list price percentage and time on market before sale. But there were also very substantial differences in the average dollar per square value realized upon sale – and the hotter the market, the larger the percentage decline in dollar per square foot value that accompanied price reductions. This is almost certainly due to missing out completely on the sales-price-enhancing effects of overbidding.

So, overpricing typically lowers values for sellers, which also signifies opportunities for buyers who keep their eyes open for price reductions and react accordingly.

Mortgage Interest Rates Hit Multi-Year Lows

A Critical Dynamic in Affordability & Buyer Demand



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