I’ve just returned from a two-week holiday in London and Paris, visiting friends and enjoying those beautiful cities. I’ve been chatting with colleagues and surveying our local market since my return, getting up to speed on what’s happening in San Francisco real estate.
Here’s the latest:
Buyers are snapping up single-family homes. Nothing new here, but activity has heightened since March. For example, any seller with a house in a good Noe Valley location that ticks all the boxes can expect multiple offers—most without any contingencies—and a sale price well over the list price. One two-bedroom Victorian on Diamond Street listed for $1.7M garnered 27 offers and is reportedly in contract for just under $2.5M. Ditto that for 888 Douglass, a modest home listed for $2.2M that closed for $2.9M—that kind of thing. Other neighborhood hot spots with big overbids are the Richmond, Sunset, Parkside, West Portal and Sunnyside. 59 of the 251 homes sold from March 1 to April 11th closed for 25%- 54% over asking. We’re chalking it up to continued low inventory and high demand.
Condos that didn’t sell in 2024 are selling now. I’ve seen multiple instances of condos selling this year that had unsuccessfully been on the market in 2024. This is particularly true of condos. We had promoted my 1BR Yerba Buena listing at 300 3rd for the better part of the fall, canceled it around the holidays and then came on the market in January—landing cash buyers within about two weeks.
The recent stock market plunges don’t seem to be slowing us down. 78 houses, 70 condos and 22 multi-unit buildings have gone into contract since the initial crash on April 2nd. I spoke with a variety of agents recently about how their buyer clients are approaching purchases in the face of the stock market volatility. Some agents said their clients had liquidated their down payments (smart thinking), others mentioned that the low inventory was driving activity. Some did say their buyers were hesitant to purchase now; most thought that many people were in a wait and see mode.
Inventory is coming. 55 single-family homes, 82 condos and 15 two-unit buildings have hit the market over the past week. Add to that 57 houses, 97 condos and eight two units that are “coming soon” in the MLS and expected to go on the market in the coming weeks. These aren’t astronomical numbers, but they do matter in a tight-inventory market like San Francisco.
Buyers are turning to TICs to get into their desired neighborhood. There was a time when buyers were hesitant to jump in on TIC purchases. I’ve had two separate clients get preapproved for TIC loans over the past several weeks, motivated by specific properties that met all their criteria and were in their preferred locations. TICs in two-unit buildings are particularly popular, as those offer the most straightforward path to condo conversion.
Year-over-year averages are down, but volume is up. The average house price in the first quarter was $2.1M, down from $2,142,000 in Q1 2024. But we’ve seen a 13% boost in volume this year. Same goes for condos, with the average sale price drop of $1,255,000 from Q1 2024’s $1,310,000, offset by a 10% increase this year in closed units.
So that’s what’s happening in San Francisco. Though I didn’t dive deep into London real estate, I can tell you that there are cranes everywhere! London construction is alive and well. Scan any vista and you’ll see multiple cranes. Also, we saw the Holme house in Regent’s Park that recently sold for $139M pounds ($172M in US dollars). That’s a picture of the house above. Paris is not under heavy development, but apartment prices are in the $1,600/sq foot range–much higher than San Francisco’s $1,017 average. We may not have galettes, awesome fresh cheese & baguettes, or the Louvre here, but we have less expensive real estate.