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February 9, 2023

SF Condo Market Report: January 2023

Living room in 301 Mission 54B

Things started looking up for the condo market in January. The median price was up year-over-year, and buyers started coming out of the woodwork despite higher interest rates. Here’s what went down:

Median year-over-year price ticked up. January 2023’s median sale price was $1,038,500—a smidge above January 2022’s $1,025,000 median.

Price per square foot dropped, though. The average price per square foot for a condo in January was $965—down 12% from $1,098 in January 2022.

Volume check: There were 44% fewer sales last month (84) than there were in January 2022 (150).

Drill down: Here’s a quick look at how the most popular condo categories did:

1BRs | 24 sold | $724,500 median price

2BRs | 40 sold | $1,214,750

3BRs | 15 sold | $1,375,000

Most condos sold for under their list prices: 83% of all condos that closed in January  did so for under the list price, and only one sold for 20% or above list price. And that sale at 151 Alice B. Toklas #712 technically closed for well under asking. They had listed the unit in May 2022 at $1.6M, and then eventually lowered the price to $995,000 to kickstart a bidding war. So though the final sale price of $1.2M appeared to be 20% above asking, it actually sold for 25% below its original list price.

Only a handful of luxury condos sold: Five condos closed escrow in January for $2M+, ranging in price from $2,250,000 – $7,750,000. That top sale went to 301 Mission #54B in the Millennium Tower. (Photo above courtesy Sotheby’s International Realty) #54B was a 2BR/3.5BA unit on one of the highest floors and clocked in at 3315 square feet. It was originally listed for $8,580,000. (So yes, people are still buying in the Millennium despite its well-publicized structural issues.)

Current mood:  More lively and a little desperate. New buyers seemed to get into the market in mid January, which is fortunate because there are almost 500 active condo listings and only 157 units in contract. These current listings have been on the market for an average of 81 days. We need the buyers!

Pro Tips:
Be cautious about using a super list-low strategy when it comes to the condo market. Going slightly below the target value is probably a better bet. And listing above market value may result in your property languishing on the market as buyers bypass the property for other, more attractively priced units.

Buyers: It’s time to get off the sidelines and buy what you can afford under the latest interest rates. Waiting for prices to fall may backfire on you in 2023.

{All data courtesy of the San Francisco Multiple Listing Service]

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