Condo sales are seeing the usual summer slowdown.
Only 196 condos sold in July 2022, down from 316 in July 2021. However, the median year-over-year price only dropped slightly from $1,212,000 to $1,202,500 despite rising interest rates and increasing inventory.
Overbidding was limited among condo buyers. Only nine units sold for more than 20% over asking, mostly for two-bedroom units in Hayes Valley, Lower Pacific Heights, Mission Dolores and Eureka Valley. Otherwise, the average overbid citywide was a mere 1.5%—down from 4.41% last July.
It will take several months to sell off the roughly 700 condos currently available, if the number of closed sales in July are any indication. What I’m talking about is known as the “absorption rate.” For example, if only 200 condos are selling in a given month and there are 700 active condo listings, that means it will take three- to four months to deplete that inventory.
Adding to the glut will be the inevitable new Fall inventory, but more buyers will likely hit the market heading into September to pick up the slack.
The luxury market saw some movement, with 28 condos changing hands for $2M or more. The most expensive condos sold were the George and Charlotte Schultz penthouses at 999 Green in Russian Hill (see photo above, courtesy Compass). Both units sold for a combined $29M (sight unseen) to an LLC with an address registered to Palm Beach Gardens in Florida.
Where’s all this going? I’m thinking that August will see fewer new listings—as it always does—because most sellers will wait until after Labor Day to go on the market. The reality is that August finds many buyers and sellers on vacation, and 2022 is no exception. I’m betting that a bulk of the active listings will move from August right into September, adding to the already high volume of condo listings. More supply than demand for condos could see far less competition for buyers, and a few deals at all price points.
[All data courtesy of the San Francisco Multiple Listing Service.]