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January 3, 2018

SF House Market Soars (Again) in 2017

A strong local economy coupled with high buyer demand fueled the San Francisco single-family home market in 2017 amidst a backdrop of concerns about things like the new presidential administration, North Korea and a possible real estate bubble.

2017 was basically a continuation of the 2016 market—high prices, multiple offers, extreme overbids, discouraged buyers and happy sellers.

The good news for homeowners is that the average price of a house in the fourth quarter of 2017 was almost $1.9M. The bad news—if you can call it that—is that the average price rose less than 2.5% over Q4 2016. Given that we’ve seen double-digit growth over the past few years, this minimal increase is worth noting as we head into 2018.

House sales closed at a rapid pace, with properties spending an average of 25 days on the market.

Overbidding showed no signs of slowing down, with buyers paying an average of 5.5% above the list price in Q4 2017. However, almost a quarter of those properties sold for 20% or more over asking.

And once again, the same neighborhoods popped up as overbid hotspots—the Outer Parkside, Outer Sunset, Bernal Heights, Noe Valley and Portola/Excelsior.

Let’s look at some other Q4 2017 fun facts:
Cash sales. Fewer than 20% of all houses sold changed hands in all-cash sales.

Average price per square foot: $963

Most expensive sale: 2636 Union Street in Cow Hollow. This four-level, 5BR/4.5BA Arts and Crafts home with Bay views from every level sold for $9,285,000 to a co-founder and partner of a venture capital firm.

Least expensive sale: 1182 Fitzgerald in Bayview. A real estate company purchased this small fixer for $470,000 and is currently adding two bedrooms, two bathrooms, remodeling the kitchen and bath. You’ll see it hit the market again next year.

Here are the overbid highlights you can bring up at winter gatherings this month
436 Valley | Noe Valley
3BR/1BA, 1341 sq ft
List price: $1,195,000 | Sold: $1,821,300

590 30th Street | Noe Valley
3BR/2BA, 1481 sq ft
$1,300,000 | $1,875,000

833 Duncan | Noe Valley
3BR/2.5BA, 1735 sq ft
$1,398,000 | $1,858,000

445 Douglass | Eureka Valley
4BR/3.5BA, 2713 sq ft
$2,995,000 | $3,625,000

56 Encanto Ave | Anza Vista
4BR/2BA, 2550 sq ft
$1,998,000 | $2,535,000

1914 Webster | Lower Pacific Heights
5BR/2BA, 3158 sq ft
$1,995,000 | $2,601,000

33 Capra | Marina
3BR/2.5BA, 2110 sq ft
$1,999,000 | $2,605,000

166 Ellsworth | Bernal Heights
2BR/1BA, 1025 sq ft
$998,000 | $1,500,000

840 Kansas | Potrero
2BR/1BA, 1165 sq ft
$1,095,000 | $1,629,000

The tax bill chaos may have done its part to accelerate transaction closings. Though it’s only anecdotal, I spoke with a number of lenders in early December who were jamming loans through so their buyer clients could wrap things up in 2017. Similarly, many agents with whom I spoke encouraged their seller clients to put their homes on the market as late as mid December in a bid to skirt 2018 uncertainties.

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